Mobile Home Parks
This industry comprises establishments primarily engaged in acting as lessors of real estate (except buildings), such as manufactured home (i.e., mobile home) sites, vacant lots, and grazing land.
In re GGP, Inc. Stockholder Litig.
Brookfield Property Partners Inc. acquired GGP Inc. in a merger transaction. During negotiations, Brookfield Property Partners LP expressed concern over the number of GGP stockholders who might see appraisal under Delaware law. Brookfield Property Partners suggested inserting an appraisal rights closing condition that allowed it to terminate the agreement if a specified number of GGP shares demanded appraisal. Brookfield Property Partners objected, and the condition was nixed. At the urging of Brookfield Property Partners, the merger was structured so that Brookfield paid a sizable preclosing dividend followed by a small residual payment called a “per share merger consideration.” GGP stockholders were told they could exercise their appraisal rights solely in connection with the merger, set at $23.50 per share, in relation to the per-share merger consideration valued at $0.312 per share. Plaintiff stockholders claimed they were led to believe that a fair value determination would be limited to the value of the post-dividend of GGP. The Supreme Court agreed with the Chancery Court that the defendants did not unlawfully eliminate appraisal rights but disagreed that the proxy disclosures were sufficient.
The Delaware Chancery Court Erred in Dismissing Claims Regarding Appraisal Rights Disclosures in a Merger—Supreme Court Remands
Brookfield Property Partners Inc. acquired GGP Inc. in a merger transaction. During negotiations, Brookfield Property Partners LP expressed concern over the number of GGP stockholders who might see appraisal under Delaware law. Brookfield Property Partners suggested inserting an appraisal rights closing condition that allowed it to terminate the agreement if a specified number of GGP shares demanded appraisal. Brookfield Property Partners objected, and the condition was nixed. At the urging of Brookfield Property Partners, the merger was structured so that Brookfield funded a sizable preclosing dividend which was paid by GGP to eligible shareholders, followed by a small residual payment called a “per share merger consideration.” GGP stockholders were told they could exercise their appraisal rights solely in connection with the merger, set at $23.50 per share, in relation to the per-share merger consideration valued at $0.312 per share. Plaintiff stockholders claimed they were led to believe that a fair value determination would be limited to the value of the post-dividend of GGP. The Supreme Court agreed with the Chancery Court that the defendants did not unlawfully eliminate appraisal rights but disagreed that the proxy disclosures were sufficient.
Pourmoradi v. Gabbai
This California appellate case reviewed the trial court’s decision that discounts for lack of control and lack of marketability were not appropriate in determining the value to be paid to the plaintiffs in this corporate dissolution case where the remaining 50% owners exercised their right to purchase the plaintiff’s 50% interest in the LLC.
California Appellate Court Remands for Application of Trial Court of Wrong Standard of Value Denying Discounts
This California appellate case reviewed the trial court’s decision that discounts for lack of control and lack of marketability were not appropriate in determining the value to be paid to the plaintiffs in this corporate dissolution case where the remaining 50% owners exercised their right to purchase the plaintiff’s 50% interest in the LLC.
Tax Court Allows for ‘Slight’ Discount for Lack of Control for Majority Interests in Real Estate Holding Companies
In a gift and estate tax dispute, the estate and Internal Revenue Service agreed to apply discounts for lack of control and marketability to the majority interests in a number of real estate holding companies. The U.S. Tax Court noted that, in prior decisions, the court found no discount for lack of control applied. However, given the parties’ agreement, here, the court said it would apply a “slight” or “low” discount.
Estate of Warne v. Commissioner
In a gift and estate tax dispute, the estate and Internal Revenue Service agreed to apply discounts for lack of control and marketability to the majority interests in a number of real estate holding companies. The U.S. Tax Court noted that, in prior decisions, the court found no discount for lack of control applied. However, given the parties’ agreement, here, the court said it would apply a “slight” or “low” discount.
D.C. Circuit Upholds Remainder-Interest Valuation in Weird Charitable Contribution Case
In charitable contribution case involving remainder interest, D.C. Circuit upholds Tax Court’s value-related findings, including that petitioner did not provide qualified appraisal and did not meet substantiation requirements; valuation here is to be based on FMV, not actuarial tables.
Blau v. Commissioner (RERI II)
In charitable contribution case involving remainder interest, D.C. Circuit upholds Tax Court’s value-related findings, including that petitioner did not provide qualified appraisal and did not meet substantiation requirements; valuation here is to be based on FMV, not actuarial tables.
Tax Court Introduces Formula to Value Donated Remainder Interest
Tax Court rules for IRS in disallowing deduction for charitable contribution involving remainder interest in leased property; requisite appraisal summary omits vital information, and court’s valuation formula shows donor made gross valuation misstatement.
Tax Court Introduces Formula to Value Donated Remainder Interest
Tax Court rules for IRS in disallowing deduction for charitable contribution involving remainder interest in leased property; requisite appraisal summary omits vital information, and court’s valuation formula shows donor made gross valuation misstatement.
RERI Holdings I, LLC v. Commissioner (RERI I)
Tax Court rules for IRS in disallowing deduction for charitable contribution involving remainder interest in leased property; requisite appraisal summary omits vital information, and court’s valuation formula shows donor made gross valuation misstatement.
RERI Holdings I, LLC v. Comm’r
Tax Court denies IRS’s summary judgment motion to disallow claimed charitable deduction arguing taxpayer’s appraiser improperly valued donated interest in LLC using present-value Section 7520 tables and failed to submit “qualified appraisal.”
Tax Court Foils ‘End Run’ Around Expert Rules
Tax Court rejects taxpayer’s attempt to place in evidence a new appraisal regarding the decedent’s interest in an LLC whose principal asset was real estate by way of stipulation, finding he failed to qualify the appraiser as an expert and did not present ...
Estate of Tanenblatt v. Commissioner
Tax Court rejects taxpayer’s attempt to place in evidence a new appraisal regarding the decedent’s interest in an LLC whose principal asset was real estate by way of stipulation, finding he failed to qualify the appraiser as an expert and did not present ...
IRS Gives Hybrid Business Favorable Tax Status
In a non-precedential ruling, the IRS approves a proposed data center business for status as a real estate investment trust (REIT) under IRC section 856, finding the properties the company plans to lease to tenants are real property and constitute real es ...
Private Letter Ruling 201314002
In a non-precedential ruling, the IRS approves a proposed data center business for status as a real estate investment trust (REIT) under IRC section 856, finding the properties the company plans to lease to tenants are real property and constitute real es ...
Is Valuation Expert Allowed to Derive Key Rates for Real Property Appraisal?
To value a company that owns real property, business appraisers frequently rely on third-party appraisals by presumably qualified experts. In a recent twist, in this case, the real estate appraiser relied on components of value, including occupancy and m ...
Sugar Hill, LLC v. United States
To value a company that owns real property, business appraisers frequently rely on third-party appraisals by presumably qualified experts. In a recent twist, in this case, the real estate appraiser relied on components of value, including occupancy and ma ...
Elliott v. Elliott
Trial court errs by valuing the husband’s minority interest in a family held limited liability corporation by reference to the underlying real property, when there was no evidence that the husband could access the property or its income.
Estate of Mitchell v. Commissioner
Tax Court sides with estate and holds proper method for valuing 100% leased-fee interests of real property is income capitalization method, rather than lease buyout method proposed by respondent’s expert.
May Buy-Sell Appraiser Modify an Opinion After Submitting a Report?
Trial court holds that an appraiser who submits a second report to correct for errors, omissions in the original is nevertheless “bound” by the original appraisal.
Chapman v. The Westerner
Trial court holds that an appraiser who submits a second report to correct for errors, omissions in the original is nevertheless “bound” by the original appraisal.
Does Fair Value of FLP Include Marketability and Minority Discounts?
Court considers whether discounts apply to statutory fair value appraisal of partnership withdrawal/dissolution.
Freestyle Martial Arts Corp. v. Soco
Successful lost profits analysis turns on clear evidence of lost revenue and other key assumptions.