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Practice/Industry Group Overview
Real Estate Capital Markets
Hunton & Williams LLP consistently ranks as one of the most experienced law firms with respect to real estate capital markets transactions, representing issuers, underwriters, sponsors and lenders in connection with structuring and financing publicly and privately owned real estate companies, including in particular real estate investment trusts (REITs). The firm regularly receives top tier national rankings for its work as both issuer's and underwriter's counsel in The American Lawyer, Thomson Financial and Chambers USA.
Hunton & Williams has extensive experience in taking real estate companies public, both as REITs and as C corporations, and in subsequent financing transactions. We have handled more than 100 IPOs and Rule 144A equity offerings and more than 400 capital market transactions involving more than 135 REITs and other real estate companies. In the course of those and other engagements, we have worked closely with the leading investment banking firms, accounting firms and other professionals active in the real estate finance industry. As a result, our Real Estate Capital Markets Group is particularly well qualified to assist companies accessing the public capital markets as well as private capital sources.
Our clients include equity and mortgage REITs, C corporations, real estate funds, partnerships and other owners of real estate, investment banking firms acting as underwriters of and advisors to REITs and other real estate companies and lenders to real estate companies and owners. We have been involved in transactions for REITs and other real estate companies owning or providing mortgage financing for office buildings, retail properties, distribution and flex facilities, apartment properties, hotels, storage facilities, health care properties, shopping centers, automobile dealerships, congregate care housing, golf courses, bank branches, student and military housing, timberland, vineyards and subordinated and residual interests in securitized residential and commercial mortgage loans.
We have a particular focus on hotel and mortgage REITs, the formation of which requires consideration of many complex tax, securities, partnership, corporate and secured lending issues. Hunton & Williams pioneered the resurgence in the lodging industry's use of the REIT structure. We also have substantial experience assisting clients in analyzing the complex tax and Investment Company Act issues relating to the structure and operations of mortgage REITs.
The diverse nature of our real estate industry clients enhances the breadth of our experience in handling financing transactions and addressing the ongoing disclosure, reporting and tax compliance issues that arise in such transactions.
Many of our REIT clients have been organized using the umbrella partnership, or UPREIT, structure, both to facilitate the initial acquisition of properties (and the tax planning for the existing owners of such properties) and to provide a tax-favored currency for future acquisitions. Hunton & Williams has also advised clients contemplating the REIT structure who ultimately elected C corporation or partnership status after considering the REIT structure alternative, including corporations with an operating partnership, known as Up C corporations.
We are experienced in structuring transactions utilizing the UPREIT and DownREIT structure, to facilitate REITs' acquisitions of properties and tax planning for sellers of properties. A REIT's property acquisitions, particularly from broadly held partnerships, can often trigger unexpected registration, disclosure and fiduciary duty issues under complex regulatory "roll-up" rules. Hunton & Williams is thoroughly familiar with all of the regulations that impact the feasibility and structure of a roll-up transaction.
A number of REITs and other real estate owners have accessed the capital markets through long-term securitized mortgage financing. Mortgage securitization allows a property owner to obtain favorable financing rates while retaining 100 percent equity ownership of its properties. For this reason, securitization can be an attractive source of debt financing for real estate owners. Hunton & Williams has a nationally recognized mortgage securitization practice and substantial national experience assisting REITs in securitization transactions.
Structuring and closing a public or private REIT equity or debt financing involves a series of complex tax, securities, partnership, and real estate law issues. The preparation of a registration statement and the underlying documents for a publicly offered REIT financing transaction can be extremely time consuming, and the coordination of the financing activity with the real estate work can present difficult timing issues. Experienced counsel with a broad working knowledge of REITs and multi-property real estate transactions can be tremendously valuable in organizing and effecting a public or private financing in an efficient and cost-effective manner, while minimizing disruptions to the company's ongoing business operations.
We have been involved in numerous merger and acquisition transactions involving REITs and other real estate companies, including mergers between publicly owned REITs, mergers between REITs and C corporations as well as acquisitions of privately owned REITs and other entities by publicly owned REITs. We have acted as counsel on more than 20 REIT M&A transactions aggregating more than $12 billion. We also have advised Boards of Directors of REITs and other companies in transactions involving related parties or affiliated parties. Merger and acquisition transactions for REITs often involve complex issues of state and federal tax law, securities law and partnership law. We have helped structure numerous transactions to address these and other issues.
Our Real Estate Capital Markets practice often overlaps with our Private Equity Fund Formation practice. We represent both sponsors and investors in real estate private equity fund transactions. Our REIT experience is invaluable when a private equity fund is structured as a private REIT or when a private REIT subsidiary is incorporated into the fund structure for tax planning purposes.
We conduct our real estate capital markets practice through a multidisciplinary team of lawyers focusing in tax, corporate, securities, real estate and environmental law. Our lawyers traditionally have taken leadership roles in addressing emerging issues and developing policies in our practice areas and serve in various capacities in professional and industry organizations involved in monitoring and shaping the tax and securities laws affecting REITs and other real estate companies. For example, our lawyers have served as Chair of the American Bar Association (ABA) Business Law Section's Partnership Committee, that Committee's Subcommittee on REITs, REMICs, and Financing Trusts; the ABA Tax Section's Committee on Financial Transactions; the ABA Real Property, Trust & Estate Section's Committee on REITs; and as members of the Executive Committee of the Commercial Real Estate Secondary Market and Securitization Association (CSSA). Our lawyers are active on a number of other important ABA committees, including the Federal and State Regulation of Securities Committees and are active members of industry associations, such as the National Association of Real Estate Investment Trusts (NAREIT) and its committees and write and speak frequently on topics of interest to the REIT community.
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