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Accounting 2013

By Stephen Kleege 3/05 2:00pm

Accounting 2013

REIT

REIT So Sweet: Investors Reconsider Real Estate Investment Trusts

Tax-advantaged Real Estate Investment Trusts are likely to gain favor among investors, boosted by increasing tax rates, recovering real estate prices and faster-than-anticipated growth, according to Paul Becht, audit partner at Holtz Rubenstein Reminick LLP.

The U.S. already raised the tax rate on qualified dividends to 20 percent, from 15 percent, making REITs more attractive relative to other equity investments. And there’s a possibility of more tax rate adjustments as the government continues to cast around for ways to balance the budget. Read More

By Stephen Kleege 3/05 1:00pm

Accounting 2013

Detective-with-smoke-flipped

Brick-and-Mortar Sleuthing: The Forensic Number-Crunchers Behind This Year’s Biggest Accounting Trend

The recession and slow-growing economy of the past four years have led to more forensic lease audit work for accountants, as tenants and landlords try to rein in expenses.

Disputes over tenants’ responsibility for repair and improvement costs in addition to their base rent are seldom publicized, since they tend to be settled out of court, but substantial money can be at stake.

“In one instance, I actually recovered $1.9 million for a tenant,” said Thomas Woodward, director of real estate advisory services at Holtz Rubenstein Reminick LLP. “It’s not unusual for me to come up with a million here and a million there.” Read More

By Billy Gray 3/05 10:00am

Accounting 2013

Lew Rudin, Bill Rudin, Jack Rudin

Succession Planning: How Real Estate Dynasties Pass the Torch

When it comes to succession plans, real estate insiders start reading the tea leaves early. After Martin Burger was tapped as Silverstein Properties’ co-chief executive in December 2011, Mr. Burger told The Commercial Observer that the company’s larger-than-life chief executive, Larry Silverstein, now 81, had “already made the decision” during conversations between the colleagues two years prior.

“I don’t think Larry’s ever going to retire,” Mr. Burger added. “He’s a force of nature.”

The prescience among real estate dynasts to plan ahead often collides with their desire to remain in control as long as they can, real estate titans and accountants acknowledge.

“Real estate companies do organize, but what I see there as opposed to in other industries is more of the people staying involved a lot longer,” said Rob Gilman, a partner at the accounting firm Anchin, Block & Anchin LLP. “In other businesses, people retire at 65 years old. The matriarch or patriarch of a lot of these real estate families stays on well into her or his 70s.” Read More

By Billy Gray 3/05 9:00am

Accounting 2013

Crunching The Numbers On Sandy

The announcement last week that Liberty Mutual had signed a 10-year, 120,000-square-foot lease at 55 Water Street was a rare and welcome piece of good news at a building and corridor of lower Manhattan exceptionally hard-hit by Superstorm Sandy.

The 53-story Financial District skyscraper took on 32 million gallons of water following the October 29 natural disaster. A month later, 30 people were treated for injuries after the basement caught fire during electric repair work. News that Liberty Mutual would be doubling its footprint in the property no doubt came as a relief to the landlord, New Water Street Corp., as it poured $200 million worth of renovations into the ailing tower.

The woes of the building at 55 Water Street are emblematic of those afflicting Manhattan commercial properties affected by Sandy. Accounting firms working on their behalf as they seek damages are all too familiar with the sort of cascading problems wrought by the storm that require a web of insurance plans and clauses spanning wind, flood, blackout and business interruption insurance. Read More