Professional services firm Ernst & Young has secured three engagements to help three German real estate companies float on the stock market and convert to a tax-efficient real estate investment trust (REIT). German legislators are working out the fine print of the legislation and the German or G-REIT is likely to be enacted into law in April and backdated to January. Unlike the UK where the names of the likely converters were known months in advance of the introduction of a REIT there in January, no German property companies have put their head above the parapet and confirmed they will adopt REIT status.
Professional services firm Ernst & Young has secured three engagements to help three German real estate companies float on the stock market and convert to a tax-efficient real estate investment trust (REIT). German legislators are working out the fine print of the legislation and the German or G-REIT is likely to be enacted into law in April and backdated to January. Unlike the UK where the names of the likely converters were known months in advance of the introduction of a REIT there in January, no German property companies have put their head above the parapet and confirmed they will adopt REIT status.
Karl Hamberger, an attorney and partner at Ernst and Young's real estate division in Germany told PropertyEU that the German real estate companies are still awaiting the final draft of the legislation before deciding whether to convert to G-REIT status. He said, however, that he is expecting the first of the three companies to have engaged Ernst & Young to IPO by June. While he could not reveal the identities of the prospective REITs, Hamberger said one is being set up by a closed-ended fund initiator and a very highly esteemed German bank.
The second involves a start-up company that does not currently have a property portfolio. A 'well-known international investment bank' is the capital provider. The third engagement relates to an existing company that is a long-term holder of property. Hamberger said he expects at least two more batches of German property companies to choosing the REIT route two or three months after the legislation is finalised.