272.F投资性房地产准则在上市公司中的运用外文原文.doc

From：IESE Business School University of Navarra Avda INVESTMENT IN REAL ESTATE: LISTED COMPANIES AND FUNDSAbstract ： In Europe today, there are two main vehicles for indirect investment in real estate: real estate investment funds and listed real estate companies. With these instruments not only does the investor take a position in the real estate market, he/she also acquires different risk/return structures, which may vary according to the instrument being used. In some European countries, real estate companies have modified their financial structure and tax position by adopting a legal form based on REITs (Real Estate Investment Trusts), which originated in the US; this changes their position compared to real estate funds. In this paper we compare real estate funds and listed real estate companies and analyse the appearance of REITs in Europe and their impact on the real estate industry.Keywords: real estate, real estate investment, real estate fund, real estate company, REITIntroductionBecause of the increase in volume and the sophistication of investment in real estate, indirect channels of investment through investment entities are being given increasingly frequent consideration. These entities can take different legal forms and may vary in their characteristics, but they tend to be divided into two large groups: companies and real estate investment funds.This paper describes the main characteristics of the large indirect investment vehicles taking the form of listed companies and real estate investment funds in Europe. It includes a cross-country comparison of the performance of the two types of vehicle and direct investment in real estate.Listed real estate companiesa)InvestmentThe portfolio of the 100 largest European listed real estate companies is 180 billion euros, with a market capitalization of 110 billion euros. By country of origin, the UK, France, the Netherlands, Sweden and Spain have the largest volumes The difference between the UK, with 76.6 billion euros, and the other countries is notable, despite a period of takeovers and privatisations in the UK due to an unfavourable market environment following the abolition of “Advance Corporation Tax”British Land, from the UK, is the largest company, with a value of 17.7 billion euros. It was traded at a 10% discount to net asset value (NAV). In second place is Land Securities, also a British company, with 12.1 billion euros in real estate assets. These two companies invest only in the UK and 90% of their portfolio is invested in offices and shopping centres. The third place goes to Gecina, a French property investment company focusing on the residential and offices industry, mainly in Paris. The rest of the ten largest companies are: from the UK, Liberty International, Hammerson, and Slough Estates, focusing on the offices and commercial industries, with the exception of Slough Estates,50% of whose portfolio is invested in the industrial sector; from The Netherlands, Rodamco, “a large European retail property company, with 89% of assets invested in retail and the remainder largely in offices”， from France, Unibail and Klépierre, also focusing on the offices and commercial industries. By market capitalization, Land Securities takes first place, followed by British Land, Unibail, Rodamco Europe, Liberty International, Hammerson, Slough Estates and Corio, a Dutch real estate company with a market capitalization of 2.9 billion euros in January 2005. Corio focuses mainly on investment in shopping centres. In 2003, 71% of its portfolio was invested in commercial property, 23% in offices and 5% in the industrial sector, with investments in the Netherlands, France, Italy and Spain and a portfolio value of 3.8 billion euros. Below Corio are Gecina and the Austrian company Immofinanz, with 1.8 billion euros in market capitalization in January, 2005. Immofinanz is Austrias largest real estate company. Its 3 billion euro, 3.54 million m² portfolio includes 900 properties from allThe real estate sectors in 19 countries, with a focus on Central Europe.With regard to premiums or discounts on Net Asset Value, EPRA, in its report “Europe Real Estate Yearbook 2005”, states that discounts on NAV tend to exist in countries where there is no legal equivalent to REITs, whilst in countries where there is an equivalent, there is a tendency to trade above Net Asset Value.Table 2 shows the percentage invested in the different sectors by the 10 largest European real estate companies. As mentioned in previous paragraphs, office and commercial property clearly predominates.b)Introduction of REIT-equivalents into some European countriesIn some European countries, real estate companies can adopt a legal status similar to that of a REIT, or Real Estate Investment Trust.REITs appeared in the US following an amendment to a popular legislative landmark: the 1960 tax extension law on cigarettes/cigars. In fact, they date back to the nineteenth century, 1880 to be precise, when investors were able to avoid double taxation by using Trusts, which were exempt from tax at corporate level if profits were shared out among investors. In 1930, this tax advantage was abolished and any passive investments had to be declared by each investor, first at corporate level and, then, individually. This tax disadvantage lasted for 30 years, despite the fact that Real Estate Investment Funds (in shares and bonds) were not liable to such double taxation.After the Second World War, the growing demand for Real Estate Funds led “President Eisenhower to sign the 1960 Real Estate Investment Trust Provision, which eliminated this double taxation, qualifying REITs as pass-through entities”. In 1986, the Reform Act allowed REITs to manage their real estate directly, that is, they could exist without an intermediary management company. This eliminated many of the conflicts existing between REITs and their administrators. In 1993 the barriers preventing pension funds from investing in REITs were removed.A REIT, a “legal guise” used by real estate companies whose securities can be traded on the stock market, is a property investment company whose main activities are managing, letting or selling real estate, investing in other real estate companies, and even financing real estate. REITs are far more liquid than other alternative investment vehicles. They generally operate like any other property or realestate company; what makes them different is that they are exempt from corporate tax provided their investment policies and income distribution (in the US, 90% of income) comply with the prevailing laws in each country.REIT regimes started appearing gradually in the different European countries. In1969, BIs (Fiscale Beleggingsinstelling) appeared in the Netherlands as a result of the Dutch Corporate Tax Act. The BI regime is a pure tax regime, and therefore any company wishing to adopt this legal form does not have to fulfil any legal requirements. BIs are listed on the securities market and therefore come under the supervision of the Dutch Financial Market Authority. BIs must be exclusively devoted to portfolio investment activities and can only have a leverage of 60% of the fiscal book value of the real property and 20% of the fiscal book value of all other property.BIs must distribute 100% of their operating income, while capital gains or losses are placed in a tax-free reserve, which does not have to be distributed. Profits must be distributed within 8 months of the close of the financial year.In 1995, the SICAFI structure (Société dinvestissement à capital fixe en immobilière), a specific real estate investment institution with a favourable tax treatment, was created in Belgium. A SICAFI is defined as “a listed property fund, with a fixed amount of corporate share capital, whose role is to provide tax neutrality for collecting and distributing the rental income”.SICAFIs must have the specific legal status of an investment fund, as well as complying with numerous legal requirements, which include having to have a suitable corporate form (Limited liability company or Limited partnership with shares under Belgian law). The company must be resident in Belgium, have a minimum shareholders equity of1.25 million euros and be incorporated for an unlimited period of time. The portfolio directors and managers must also have appropriate professional experience, etc.SICAFIs may have leverage of 50% of the companys assets at the time the loan agreement is concluded and they must distribute 80% of their net profit in the form of dividends. Capital gains do not have to be distributed and remain tax-free provided they are reinvested within four years after they are obtained. Profits must be distributed on an annual basis. In France12, at the end of 2003, the SIIC (Société dinvestissement immobilier cotée) tax regime was created in order to promote the development of real estate investment funds and strengthen their position in the market with respect to Dutch, Belgian and German open-ended funds. The SIIC was also designed to generate non-recurrent budget resources to help reduce the French deficit. SIICs come under the supervision of the Autorité des Marchés Financiers.Any listed real estate investment company, or any subsidiary whose capital is at least 95% held by the parent company, can adopt this legal form. A SIICs main activity must be passive investment in the real estate industry, although it may also commit to other activities providing they remain ancillary to the main qualifying activity. Financial leasing is permitted but may not account for more than 50% of the companys gross assets. Other ancillary activities such as real property development or brokerage are also permitted, but they may not account for more than 20% of the companys gross assets. In addition, these other activities do not have the same tax privileges. Unlimited leverage is permitted.SIICs must distribute 85% of profit from real estate leasing and 100% of the dividends received by any subsidiary that has opted for the SIIC regime.Fifty percent of capital gains arising from the transfer of real assets or the shares of real estate companies, as well as from the shares of any subsidiary companies which have opted for the SIIC structure, must be distributed.1994 saw the introduction in Italy of FIIs (Fondi di investimento immobiliare), special funds which are not pure REITs.13FIIs are defined as “Fiscally non-tax-transparent investment funds which invest exclusively in immovable assets, rights in rem in immovable assets and shareholdings in real estate companies. They are not legal entities, but rather pools of investment owned jointly by the unit holders. The unit holders of FIIs are taxed only when a profit is distributed or when they dispose of their units”. FIIs are not permitted to lend money or invest in financial instruments issued by the SGR.FIIs are tax-exempt and are managed by a managing company, called a “Società di gestione del risparmio” (SGR). They can have a leverage of 60% of the value of the real estate and 20% of the value of other assets. As regards tax, they are under no obligation to distribute operating profit or capital gains.The following table sums up the tax treatment given to the different REIT regimes in Europe.c)Investment characteristics: types of assets and debt.According to the ranking of the 100 largest listed real estate companies by investment volume, the percentage of portfolio invested in the investment categories is as shown in Graph 2.Most investment occurs in offices, with 46.45% of the portfolio, followed by retail, with 33.40%. Investment in these categories takes predominance in most of the 20 companies. The exceptions are: Gecina, which invests 42% of its portfolio in the residential sector; Slough Estates, which invests 50% of its portfolio in the logistics and industrial sector; Immofinanz, which has a diversified portfolio, investing principally in the offices sector, approximately equal amounts in the commercial, residential and industrial sectors and 26% in other sectors; Brixton, which invests 90% of its portfolio in the industrial sector; and Pirelli Real Estate, which invests 25% of its portfolio in the residential sector.LIBERTY INTL.It should be noted that Land Securities, Europes second largest company in terms of investment volume, has a financial leverage of just over 30%, while Metrovacesa, sixteenth largest, has a financial leverage of over 85%. British Land, the top European real estate company in the ranking, has a financial leverage equal to the European averageD）Performance of listed real estate companiesAnnual chang in the EPRA Europe return index and the FTSE300. Although both indexes are very variable along the period, the annual change is bigger in the FTSE 300 than in EPRA Europe. On the other hand, the standard deviation is bigger in the EPRA index (424.64) than in the FTSE (395.39).he highest average annual performance among the top ten can be seen in Colonial, with 26.2%, followed by Unibail and British Land, with 24.8% and 18.7%. The highest average annual performance in Europe as a whole, however, was recorded by Town Centre Securities, from the UK, with 34.2%, followed by Grainger Trust, also from the UK, with 33.3%, and Danish company Sjaelso Gruppen, which achieved an average of 32.5%.Real estate investment funds in Europea)Concept:The definition of real estate investment funds was inspired by the term UCIT, family savings management products, which were a gateway to investment in financial securities.Real estate investment funds are unincorporated Collective Investment Institutions. Savings drawn from the public are deposited in a fund to be used basically to purchase property, which is then let in order to obtain a return. They differ enormously depending on the type of investor they are aimed at. Funds aimed at the general public, which are subject to strict monitoring by a government body, are classed as “Retail”, whilst those aimed at a privately controlled group of companies, which are not subject to any public monitoring, are classed as “Private equity”.Another category, Closed-Ended Funds, or closed funds, can be established for the structure of real estate investment vehicles. These are funds with a limited life and a specific investment volume which does not fluctuate over time, that is, if the investor wishes to disinvest, he/she must sell the stake because the fund will not sell it for him/her, which is why these funds have an initial capital collection period. Vehicles with this structure are normally aimed at institutional investors and their activity is regulated by their own rules. This is the most common structure for indirect investment vehicles, and fund