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    Real Estate (Real Estate Investment Trusts – REITs)

 

  • Representation of publicly-traded real estate investment trusts (REITs), public non-traded (non-listed) REITs and private REITs, for REIT clients in the gaming, health care, hospitality, industrial, office, retail, and telecommunications sectors.

 

  • Representation of REITs for capital raising, compliance, corporate governance, development, due diligence, eminent domain, Employee Retirement Income Security Act (ERISA), executive benefits and compensation, financing, formation, joint ventures, land use, leasebacks, leasing, litigation, management, sales, securities compliance, zoning.

 

  • Representation for issuers and underwriters in initial public offerings (IPOs) and later offerings of equity and debt securities.

 

  • Representation of both acquirers and targets in REIT M&A, for due diligence, negotiating, structuring and closing.

 

  • Consultation on the structure, formation and operation of joint ventures with private capital.

 

  • Consultation for both publicly-traded and non-traded REITs concerning disclosure and regulatory issues such as the Securities Exchange Act reporting, establishing or suspending share repurchase plans (SRPs), distribution reinvestment plans (DRPs) and tender offers (issuer and third-party).

 

  • Consultation for REIT boards and special committees on issues such as conflicts of interest, ethics, going private, umbrella partnership real estate investment trust (UPREIT) contribution transactions.

 

  • Consultation regarding class actions against healthcare-centric REIT Investment Diversification and Empowerment Act (RIDEA) structures, due to exposure resulting from increased management participation, issues with triple net leases, False Claims Act allegations, antitrust issues.

 

  • Consultation for insurance issues in anticipation of litigation against a RIDEA REIT, such as increased coverage for subsidiaries, partnership liability, pre-claim inquiry costs, entity investigation costs.

 

  • Consultation regarding formation of a single-entity subsidiary captive real estate investment trust for tax mitigation.

 

  • Consultation regarding forming a DownREIT between a real property owner and a REIT for the purpose of acquiring real property that enables the real property owner to defer capital gains tax on sale of the appreciated real property, particularly addressing the issues of whether there should be little or no capital contribution from the REIT (in which case the limited partners would receive preferences on distribution of operating cash in an amount equal to REIT share dividends) or if the REIT would provide significant capital (in which case the general partner would receive distribution equal to return of capital), and drafting a standstill or lockout agreement acceptable to the REIT covering the sale of any contributed assets.

 

  • Consultation regarding formation of a single-entity subsidiary captive real estate investment trust for tax mitigation.

 

  • Consultation regarding public non-listed REIT (PNLR) redemption restrictions limiting liquidity, share repurchase program, Securities and Exchange Commission (SEC) Electronic Data Gathering, Analysis and Retrieval (EDGAR) database filings (such as 8-Ks, 10-Ks, 10-Qs and proxy statements), state regulator ”blue sky” review and disclosure of broker-dealer valuation methodology pursuant to Financial Industry Regulatory Authority (FINRA) Notice 15-02.

 

  • Working knowledge of common public non-listed and private REIT types, such as equity REITs (generating long-term income through the collection of rent from and the eventual sale of their properties), whether and mREITs (mortgage REITs) – structured to invest in mortgages or mortgage-backed securities, such as

 

  • Familiarity with the less-common forms of REITs, such as the hybrid REIT (uses a combination of equity-based revenues and mortgage-based revenues) and the international REIT (for investments in foreign jurisdictions). 

 

  • Consultation regarding repo market rollover issues affecting mREITs, including drafting and negotiating term or open third-party (tri-party) repo (repurchase) agreements and reverse repurchase agreements.

 

  • Familiarity with less-common repo forms, such as the held-in-custody repo (seller holds the cash from the sale of the proceeds in a custodial account for the purchaser) and the specialized delivery repo (requiring a bond guarantee at commencement and maturity), and consultation for publicly-traded REIT clients on anti-takeover measures.

 

  • Compliance with the requirements for qualifying private REITs, such as the Regulation D exemptions (permitting the issuer to sell securities only to "accredited investors" – those with a net worth over $1 million, exclusive of residence) and Rules 144 and 144A which exempts securities issued to qualified institutional buyers (QIBs).

 

  • Extensive knowledge of the favorable Maryland (active admission in good standing to the Maryland Bar) legal framework (such as no franchise tax, possible elimination of directors and officers liability to shareholders, a statutory standard of conduct that governs the duties of directors, authority for the board of directors to increase the aggregate number of authorized shares of stock the corporation can issue without stockholder approval) regarding public REITs in particular.

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    Last updated 200721_2155

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