Family-owned enterprises often place real estate assets and operating businesses into separate entities, with the real estate company leasing space to the operating company. In such instances, the owners or managers need to agree upon what rent the operating business will pay to the real estate company. The rental amount will then affect the funds available for use or distribution at each company level. Without agreement on the proper amount of rent, or without equal ownership and involvement at each company level, disputes can arise as to the fairness of the rent that is charged or paid.
Continue Reading Does Your Family-Owned Business’s Lease Reflect An Appropriate Rental Value?