Last Updated June 08, 2018

Law and Practice

Authors



Allen Matkins Leck Gamble Mallory & Natsis LLP is best known for representing clients in the real estate industry and clients for whom real estate is an important part of their success. It has a longstanding reputation as one of the leading real estate law firms in the United States, having assisted clients in the development, management, financing, acquisition and disposition of real property assets. Because Allen Matkins has one of the largest real estate departments on the West Coast – more than 100 attorneys – it can bring to every deal a vast network of resources and relationships with major players in the real estate industry. Key clients include global real estate owners, operators and developers, REITs, private equity firms, state pension funds, life insurance companies and Fortune 100 technology companies. The firm's five offices are located in four major metropolitan areas of California: Los Angeles (Downtown and Century City), Orange County, San Diego and San Francisco.

Corporations are subject to double taxation and are very limited in how profits can be shared. They are generally thought to be tax-inefficient for holding real estate or appreciable assets, and are better for holding operating businesses, although this thinking may change somewhat with lower corporate tax rates.

Partnerships and LLCs generally allow partners and members to move in and out of real estate investments that have appreciated with relative ease, minimizing taxation. In some jurisdictions, an LLC may be prohibited from holding a real estate license or general contractor’s license, while a corporation may be permitted to do so. Corporations may be less flexible in how profits can be shared, however.

Partnerships and LLCs offer flexibility in reflecting the business arrangement of the partners or members. LLCs are useful in documenting varied economic arrangements, and are also very flexible in assigning day-to-day control, management and implementation, such as the right to sell property, refinance, or change business plans or budgets.

Partnerships and LLCs also allow for individually tailored exit provisions for partners and members.

Corporate shareholders, like LLC members, are generally shielded from liability, as liability remains fixed in the corporate entity. In partnerships, only the general partners or sometimes all the partners may be subject to liability. For this reason and those above, the LLC is often the preferred and most widely utilized vehicle for real estate investments.

Allen Matkins Leck Gamble Mallory & Natsis LLP

865 S Figueroa Street, Suite 2800
Los Angeles, CA 90017

(213) 622-5555

(213) 620-8816

communications@allenmatkins.com www.allenmatkins.com
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Authors



Allen Matkins Leck Gamble Mallory & Natsis LLP is best known for representing clients in the real estate industry and clients for whom real estate is an important part of their success. It has a longstanding reputation as one of the leading real estate law firms in the United States, having assisted clients in the development, management, financing, acquisition and disposition of real property assets. Because Allen Matkins has one of the largest real estate departments on the West Coast – more than 100 attorneys – it can bring to every deal a vast network of resources and relationships with major players in the real estate industry. Key clients include global real estate owners, operators and developers, REITs, private equity firms, state pension funds, life insurance companies and Fortune 100 technology companies. The firm's five offices are located in four major metropolitan areas of California: Los Angeles (Downtown and Century City), Orange County, San Diego and San Francisco.

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