German government working on revision of G-REIT law

The German government is working on amendments to the legislation governing real estate investments trusts (REITs), German real estate journal Immobilien Zeitung reported earlier this week.

The paper quoted Michael Fuchs, partner of real estate at accountancy firm Deloitte as saying that there has been extensive correspondence between the justice and finance ministeries about the final revisions to the law. 'They are obviously very far with their work,' Fuchs said, adding that he expected the REIT legislation, widely regarded by the German real estate community as having flopped, to be amended soon. Issues subject to change include the double taxation of REIT dividends from pretaxed income and the retroactive taxation of profits from disposals. Fuchs said he did not expect a wholesale revision of the existing legislation.

Germany's REIT law was ratified by parliament in March, taking effect retroactively to 1 January 2007. In June, property investment company Degi said several property companies in Germany were poised to convert to REITs. It rated 10 property firms and eight private investors as G-REIT candidates