What´s In An Ownership Structure?

When developing and/or financing land, the ownership structure of the purchaser/borrower is of significant importance to both the lender and to the purchaser/borrower and requires careful consideration. The ownership structure can be more complicated or layered depending on the nature of the development and the financial, strategic and tax objectives of the purchaser.

There are various forms of ownership structures, some involving single purpose corporations, partnerships, joint ventures, co-tenancies or trusts. Mixed use developments often require more complicated ownership structures, particularly where the various elements of the development will be retained or operated by different parties. For example, if the objective of the purchase is for development and sale, a simple ownership structure might be most appropriate whereby a bare trustee or nominee owns the land (with or without significant assets) holding the land for an underlying (usually undisclosed) beneficial owner.