GROWING BUSINESSES
UK-REITs may be at a competitive advantage over certain non-REIT acquirers of property companies as UK-REITs do not need to discount their purchase price for any latent gains in the target company.
INSTITUTIONAL INVESTORS
REAL ESTATE FUNDS
Certain types of institutional investor (for example pension funds, social housing providers, insurance companies and sovereign wealth funds) are able to establish wholly owned or joint venture UK-REITs, relying on an exemption from the close company test, and admitted to trading requirement.
Fund advisers should consider whether new property ventures may be structured as a UK-REIT rather than other fund structures. The three year grace period for meeting the close company test has made conversion to UK-REIT status a feasible exit or partial exit strategy.
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