Tech firms compete for REIT status — in an effort to save millions in taxes

Miami /
Oct.October 11, 2012 02:15 PM

Technology firms are increasingly looking to convince the government that they are, in fact, in the real estate business,  according to the Wall Street Journal. If a firm can ditch its corporate tax status and become a non-taxed real estate investment trust, it stands to save millions in taxes.

American Tower, a cellphone tower operating firm, could save as much as $400 million per year by 2017, according to analysts, due to its new REIT tax status. Another tech firm, Equinix, and Iron Mountain, a data storage company, are both expected to save some $150 million a year in taxes as REITs.However, some actual real estate executives worry that the tax dodge could cause a backlash in Washington, at a time when REIT profits are strong. The total market value of REITs rose to $451 billion in 2011 — up from just $9 billion in 1990, according to National Association of Real Estate Investment Trusts data cited by the Journal.

“The real-estate companies correctly are nervous about this phenomenon,” Kenneth Rosen, a real-estate economics consultant and former hedge fund manager, said. “The more it looks like a tax loophole, the more likely it is to affect them negatively.” [WSJ] – Christopher Cameron

 
 
 
 

Related Articles

arrow_forward_ios
Jonathan Kalikow and Leonard Tannenbaum

Jackpot: Cannabis REIT has $120M in capital to lend to operators

Jackpot: Cannabis REIT has $120M in capital to lend to operators
As resi brokers in South Florida report an uptick in sales and rentals largely fueled by homeowners fleeing dense markets like New York, office brokers say they’re starting to see a similar trend play out among tech firms. (iStock)

More tech firms eye Miami as Covid carries on

More tech firms eye Miami as Covid carries on
Daniel de la Vega with the previous website and the redesigned version (Credit: iStock)

One Sotheby’s rolls out new website during pandemic

One Sotheby’s rolls out new website during pandemic
Grand Lake Apartments and Yamal Yidios

Ytech sells a shuttered apartment complex in Belle Glade

Ytech sells a shuttered apartment complex in Belle Glade
(Illustration by Andrew Colin Beck)

These highly leveraged real estate firms could feel the squeeze in a downturn

These highly leveraged real estate firms could feel the squeeze in a downturn
Maryland pension cuts REITs out of portfolio

Maryland pension cuts REITs out of portfolio

Maryland pension cuts REITs out of portfolio
Flying carport rendering (Credit: Vimeo)

Flying carport at Miami Worldcenter featured on CBS Sunday Morning

Flying carport at Miami Worldcenter featured on CBS Sunday Morning
NAR CEO Bob Goldberg (left) and Crexi CEO Michael DeGiorgio

NAR inks partnership with Crexi

NAR inks partnership with Crexi
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...