US investors, even those exempt from tax, will have specific structural preferences when investing in UK commercial real estate. These preferences can normally be accommodated within the types of structure through which UK commercial real estate is typically held, provided they are identified early enough. In general, US taxable investors (including REITs) tend to prefer to invest through entities that are regarded as transparent for US federal income tax purposes, while exempt investors tend to prefer entities that are regarded as opaque. Where both types of investor are to invest in the same asset, more complex structuring may be required.
