More from the Author

• Case | HBS Case Collection | February 2018 (Revised December 2019)

  The Tax Man: Taxes in Private Equity Real Estate

  Nori Gerardo Lietz, Timothy J. Becker, Ricardo Andrade and Sayiddah F. McCree

  In January 2018, Caelan Langan, an associate at KSW Partners LLC (“KSW”), was asked by Katherine Scott, the partner for whom he worked, to recommend a proposed structure to acquire a prominent office building in San Francisco for their most recent fund. Caelan was asked to review potential acquisition structures that would minimize the impact of taxes on their investors’ returns. The assignment was complicated as KSW had different categories of investors (a sovereign wealth fund, pension funds and high net worth individuals) each of which had different tax considerations. The differing interests created significant potential conflicts in terms of how to manage the investment and when to sell the building, as the economic consequences to each category of investor were not the same. Even the economic interests of KSW were not completely aligned with their investors. The case outlines the alternative investment structures that could be considered: REITs, Limited Partnerships, C Corporations, and combinations of those entities. The case illustrates how to manage the potential conflicts and the important consequences of tax policy on how investments are structured. Students are asked to model the results of alternative investment structures and determine what Caelan’s recommendation should be.

  Keywords: real estate; alternative investment structures; Property; Acquisition; Private Equity; Investment; Management; Taxation; Policy;

  Citation:

  Lietz, Nori Gerardo, Timothy J. Becker, Ricardo Andrade, and Sayiddah F. McCree. "The Tax Man: Taxes in Private Equity Real Estate." Harvard Business School Case 218-077, February 2018. (Revised December 2019.)  View Details

  CiteView DetailsEducatorsPurchase

  Related

• Case | HBS Case Collection | September 2019 (Revised December 2019)

  Will WeWork Work? Suspicious Minds

  Nori Gerardo Lietz, Terrence Shu and Sean Bracken

  Citation:

  Lietz, Nori Gerardo, Terrence Shu, and Sean Bracken. "Will WeWork Work? Suspicious Minds." Harvard Business School Case 220-035, September 2019. (Revised December 2019.)  View Details

  CiteView DetailsEducatorsPurchase

  Related

• Case | HBS Case Collection | October 2019

  Toys "R" Us: Come Buy My Toys

  Nori Gerardo Lietz, Erica Segall, Alejandro Botto and Terrence Shu

  Keywords: private equity; retail; finance; Leveraged Buyout; leverage; leveraged buyouts; bankruptcy;

  Citation:

  Lietz, Nori Gerardo, Erica Segall, Alejandro Botto, and Terrence Shu. Toys "R" Us: Come Buy My Toys. Harvard Business School Case 220-023, October 2019.  View Details

  CiteView DetailsEducators

  Related