New Funding for London Councils?


In all the doom and gloom facing public services from the forced cuts imposed from the Comprehensive Spending Review of the coalition government, in a headline article by Property Week's reporter Mike Phillips it is reported that a group of London councils are in discussions with a listed property company "Local Shopping REIT" to create a new local government REIT.
 
Local Shopping REIT has appointed King Sturge Finance to advise on plans to create a joint venture structure that would then allow councils to raise cash from their property assets, while also retaining an element of ownership control and receiving income from their properties.
 
The innovative proposals would be one of the first steps in allowing councils to use their property assets to cut budget deficits without selling to the private sector.
 
The Office of National Statistics estimates that local authorities own £240bn of property.
 
Mike Riley, joint CEO of Local Shopping REIT, said
 
"we are looking at several options, and there are various ways of structuring things, and clearly REITs do have benefits."
 
"we have spoken to a number of councils and they have been receptive to ideas about ways they can optimise the value of their assets."
 
REIT status is a new type of organisation.   In the UK, the legislation laying out the rules for REITs was enacted in the Finance Act 2006 and only came into effect in January 2007 when nine UK property companies converted to REIT status, including the five that were FTSE 100 members at that time: British Land, Hammerson, Land Securities, Liberty International and Slough Estates (now known as "SEGRO").   The other four were: Brixton, Great Portland Estates, Primary Health Properties and Workspace Group.
 
British REITs have to distribute 90% of their income.   They must be a closed-end investment trust and be UK resident and publicly listed on a stock exchange recognised by the Financial Services Authority.   A closed-end investment trust is a fund established to produce income through investments.   They have a fixed number of shares, and trade like stocks.
 
To support the introduction of REITs in the Uk, the REITs and Quoted Property Group was created by several commercial property and financial services companies.   Other key bodies involved are the London Stock Exchange the British Property Federation and Reita.   The Reita campaign was launched on 16 August 2006 by the REITs and Quoted Property Group in order to provide a source of information on REITs, quoted property and investment funds.   Further information is available on the portal www.reita.org
 
Please use this blog to share your views and opinions on these new innovative ways that are being discovered to raise the essential funding for public services and local authorities to operate ...
 
Ed.
 
 
 



There are 3 comments

Administrator
Tue, 17 Apr 2012

The starting iotsevnrs pool their money, purchase realestate (usually leveraged by ), the income dirived from the property is divided amoung the shareholders after the expenses of the management company are paid. After a period of time, the trust lists its shares on a stock exchange and they are then traded just like stocks. Usually, the Starting Investors will get their shares at a discount (will get a higher rate of return), and thus they have built in an incentive to get in early and wait through the starting period when their shares are not liquid (can not be sold easily).There are special tax laws on REITs. The income of the company is not taxed until it is distributed to the owners. If you list your shares to pay dividends as shares, you do not have to pay any tax until they are either sold or you begin to tap the dividend stream.These funds are started by real estate companies in order to have a series of building they are contracted to searve (collect rents, maintain, evict dead beats, so on). They make money on the monthly fees charged per apartment, and they make money on the sale of shares to originating iotsevnrs and when the stock goes public.Most that are available in the open market are paying between 5% and 7.5% (as the income increases because of rent increases and increased value of the apartment, the price of the shares rise to maintain that 5% to 7.5% rate). many original iotsevnrs earn about 7% at the start of the investment and by the time it is public, they are earning 9% to 11% on their original investment. The investment is illiquid for the first few years (3 to 5 years).They are generally good, safe long term investments. The return is based on income rates based on rents. It is an easy way to own real estate. REITs based on Apartments are doing well now (all those people who lost a house due to forclosure have to live somewhere). Doctors' offices are also pretty safe. Doctors tend to go 20 to 30 years without moving their practice and they pay their rent very regularly and relyably. Office buildings are more sensitive to recession as are retail buildings. They also tend to have higher returns when they are fully rented.I've been in several REITs, and have been satisfied with the return. One I was an Original Investor. I bought in just before they closed the Original investment phase. It went bust right after they formed (they were not able to raise enough money to buy enough buildings to get the economies of scale they needed to make this a going REIT. Because the real estate appreciated from the time it was bought to the time the REIT went down, I was able to make a 33% return in about 9 months. In addition, I had 9 months income at 6%. I was pretty happy.


Administrator
Fri, 27 Apr 2012

From investors to pool their money, bunyig real estate (usually generated by ), income from property is divided among shareholders after management expenses paid. After a period of confidence-list its shares on the stock market, and then they are traded like stocks. Investors typically begin to receive shares at a discount (may be a higher return), so the incentive to build up early in the morning and wait through the period when their shares are liquid (can be sold easily). There are special tax arrangements for your REIT. Taxes on profits are not taxed until distributed to the owners. If the list of stocks pay a dividend in shares, you need not pay taxes until they either sold or you will start receiving dividends virta.Ne4me4 funds were started by real estate companies have a number of building have agreed to searve (collect rents, maintain flush out the dead beats, etc .). They make money on the monthly cost per apartment, and they make money from the sale of shares by investors, and if the stock goes julkinen.Useimmat, which are available on the open market will pay between 5% and 7.5% (as income increases, because the rent increases and the increase in capital stock to rise apartment claims that 5% to 7.5% interest rate). many of its original investors to earn about 7% at the beginning of the investment and when the public, they deserve to be 9% to 11% of their original investment. The investment is illiquid, for the first few years (3-5 years). They are generally good, safe, long-term investment. Return is based on revenue rates are based on rents. It is an easy way to own real estate. REIT based on the Flats are doing now (all those people who lost their home due to forclosure to live somewhere). Doctors' offices are also quite safe. Doctors usually go 20-30 years without moving their practices and they pay rent on a very regular basis and relyably. Office buildings are more vulnerable to decline in retail buildings. They also tend to have higher returns when they are fully vuokrattu.Olen the number of REITs and have been happy returns. I was one of the original investors. I bought just before the closing time of the original investment. He went bust as soon as they were (they can not raise enough money to buy enough facilities to get economies of scale they need to go REIT. As the real estate valuation, because it bought time for REITs is gone, I was able to that 33% of return of about 9 months. Besides, I had nine months revenues of 6%. I was pretty happy.


Administrator
Sun, 29 Apr 2012

He is a pompous ass, aregnt asshole, lire, and very vindictive!!!!Just watches out you do not loose your job, forced to get another job in another state, or anything that will make you loose your income He does not care as long as he gets hi full years of rent and if he does not get what he wants he will take the only money you have in your bank account he does not care about your family your wellbeing This happened to a friend of mine do not let this happen to you!!!










January 2011