WITH LOCAL TAX CODES
THE EUROPEAN UNION ISN'T VERY UNITED OVER TAX ISSUES
By Steve Bergsman
A
S IT PERTAINS TO REITS AND TAXES, THE
European Union might be better called a European disunion. In January
American Realty Capital, of New York City, hired London-based Moor Park
Capital Partners to acquire European real estate for the publicly registered
non-traded American Realty Capital Global Trust. Up to 40 percent of the
equity raised is to be invested in Europe. The new REIT's investment objectives include single-tenant, commercial properties with long-term triple-net
leases, such as retail and retail parks. Indeed, the first deal was a McDonald's
restaurant in Carlisle, England.
A number of U.S.-based REITs operate in Europe, but it takes more dexterity than investing across the U.S., or even across Canada, as the tax regimes in
the various EU countries tend to be individualistic and nonuniform. Simon
Property Group's approach to Europe was to pay $2 billion last year for a conILLUSTRATIO N: A. R ICHAR D ALLEN
trolling stake in French retail real estate owner-manager Lepierre. Belgium,
France, Germany, Italy, the Netherlands, Spain and the U.K. — boast codified
REIT structures that are very similar, but this does not make it easier for REITs in
those countries to operate cross-border.
"Having a consistent REIT regime is only one part of a much larger
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