December is still the month of large property deals

Companies close the year, lock in profit and expenses, and rearrange how their assets are held. That is why it is at the end of the year that we most often see changes of owner in large properties. A trend is becoming more visible: unit investment funds (PIFs) appear in such deals more and more often.

In the Moscow area, the following properties, among others, moved into PIFs in December alone:

1. 148,000 sq m of a logistics complex in Domodedovo, a PIF-to-PIF deal;

2. 83,000 sq m of a warehouse complex in Obukhovo, a PIF-to-PIF deal;

3. 9,000 sq m of office space in a business centre in the Obruchevsky District of Moscow, a company-to-PIF deal;

4. 10,000 sq m in a mixed-use complex in Moscow-City, a company-to-PIF deal;

5. 6,700 sq m of office premises in a business centre in Pokrovskoye-Streshnevo, a company-to-PIF-to-company deal.

A PIF is now a genuinely convenient and effective instrument for holding income-producing property. The motives for such transfers are by no means always confined to investment aims. Sometimes quite different purposes stand behind them. And they do not always remain unnoticed.

The arrangements themselves are examined separately: moving an asset between funds at a non-market price, and an attempt to reproduce offshore structures inside Russian PIFs. The Federal Tax Service and the Bank of Russia look at these movements as they used to look at transfers out to foreign jurisdictions.

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