The Netherlands

Transcription

The Netherlands

Country Q&A The Netherlands
Corporate Real Estate 2006/07
The Netherlands
Pieter van Delden, Boekel De Nerée
www.practicallaw.com/8-204-1288
THE CORPORATE REAL ESTATE MARKET
1.
What have been the main trends in the real estate market in
your jurisdiction over the last 12 months? What have been
the most significant deals?
REITs are available. Investment funds can be structured to
arrange for tax transparency (fiscale beleggingsinstellingen).
Such transparent funds are subject to corporate income tax at a
rate of 0%. Profits are taxed at the shareholders level.
Many institutional investors are active in the Netherlands,
especially where larger real estate portfolios are concerned.
In the last twelve months yields have been low, especially for
retail property and heavily leased real estate.
Many corporate real estate deals are currently being marketed as
controlled auctions, allowing the seller a high level of control over
the transaction and, at the same time, creating competition
among the bidders. Notable transactions included the:
Private investors are usually not involved in portfolio transactions, but rather in transactions concerning individual properties.
SOURCES OF LAW
3.
■
Sale of the Symphony building (Philips Pension Fund).
■
Sale of the Silver Tower building.
■
Sale of the Haagse Poort building.
■
Vendex KBB (Maxeda) sale of its retail portfolio.
What are the main sources of real estate law?
Real estate law has mostly been codified on a national level.
Delegated legislation, including in the form of ordinances, also
exists on a provincial and on a municipal level. These sources of
real estate law include:
The Dutch Civil Code (including legislation on title, rights of
mortgage, sale and purchase and leases).
■
Tax laws, planning and zoning legislation (including the Spatial Planning Act and the Housing Act).
■
The Land Registry Act (Kadasterwet).
CORPORATE REAL ESTATE INVESTMENT
2.
Please briefly outline the opportunities for investing in real
estate in your jurisdiction. In particular, consider:
■
The structures commonly used (for example, property companies and partnerships).
Case law is another major source of real estate law.
Are real estate investment trusts (REITs) and real estate
derivatives available? If so, are they commonly used?
TITLE
■
The role of institutional investors.
4.
■
The role of private investors.
■
Structures commonly used include:
■
Dutch private limited companies (besloten vennootschap
(BV) or naamloze vennootschap (NV)).
■
Partnerships (commanditaire vennootschap or vennootschap onder firma).
■
Funds (fondsen voor gemene rekening).
PLC
How is title to real estate evidenced? Is there a public register? If so, is it of title or of transactions?
There is a national Land Registry. The Land Registry is a public
register which can be consulted by anyone. Both titles and transactions are registered in it.
Recently, the Land Registry has highly improved its electronic
infrastructure, which currently enables civil-law notaries to send
files to the Land Registry using secured internet access.
A transfer of real property is made by the execution of a deed before
a civil-law notary in The Netherlands and the subsequent registration of the deed by the civil-law notary. Under special circumstances
CROSS-BORDER HANDBOOKS www.practicallaw.com/realestatehandbook
145
© This chapter was first published in PLC Cross-border Corporate Real Estate Handbook 2006/07 and is reproduced with the permission of the publisher,
Practical Law Company. For further information or to obtain copies please contact [email protected], or visit www.practicallaw.com/realestatehandbook.
Country Q&A
■
a judicial decision may replace a notarial deed. Transmission of
titles is usually recorded in the notarial deed which is registered in
the Land Registry.
finalising an acquisition of a real property, it is not possible to
withhold the above details.
6.
5.
If there is a public register of title:
■
Is there a state guarantee of title?
■
What categories of documents and information are registered?
■
Can confidential information or documents be protected from
disclosure?
Is title insurance available? If so, is it commonly used?
The use and availability of title insurance is rare in the Netherlands.
A system of mandatory notarial deeds is used to secure title to
property. Transfer of real estate can only be effected by execution of
a deed before a civil-law notary, and subsequent registration of a
certified copy of the deed with the Land Registry. Title insurance
may be used in connection with a securitisation to comply with
rating agencies' requirements.
State guarantee
7.
How can real estate be held (that is, what types of tenure exist)?
There is no state guarantee of title. Registration of ownership in the
Land Registry is not a 100% title guarantee.
Categories of documents and information
Country Q&A
The following categories of documents and information are
registered with the Land Registry:
■
Instruments by which the title to real properties is transferred.
■
Instruments by which rights of superficies (that is, rights to use
land) and leaseholds are established.
■
Deeds of mortgage.
■
Deeds of division into apartment rights.
■
Servitudes and rights of usufruct.
■
Attachments to land.
■
Resolutions in respect of (mandatory) clean up operations and
the environmental situation of real property.
■
Sale and purchase contract (registration of this is optional).
■
Various other deeds relating to legal aspects of real property.
Real estate can be held by Dutch residents and non-Dutch residents
alike. There are no restrictions on the acquisition of real estate by
using foreign legal entities. However, the legal effects of holding
property in a trust may be limited by The Hague Trust Treaty, which
has been ratified by the Netherlands.
Joint ownership is possible in any proportion. No mandatory preferential rights exist in cases of a simple joint ownership.
A distinction can be made between the following different legal
forms of real estate tenure:
■
Full land ownership.
■
Continuous or temporary leasehold; legal title to the land itself
is typically owned by the municipality in which the land is situated. Leasehold created in respect of individuals and companies is rare.
■
Apartment rights (condominium ownership).
■
Right of superficies.
■
Easements can be created in connection to the ownership of
real estate, therefore allowing the owner of a property to (partially) use the property of a third party. Easements are rights in
rem, and can be separated from the property they serve and
need not be transferred separately.
Confidential information or documents
All main details of a transaction need to be disclosed, including the:
■
Date of acquisition.
SALE AND PURCHASE OF CORPORATE REAL ESTATE
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Object of the transaction.
8.
What are the main stages in the sale and purchase of corporate
real estate? In particular, consider:
■
Purchase price.
■
How corporate real estate is marketed.
■
Parties to a transaction.
■
Commercial negotiation.
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Exact amounts of mortgages.
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Whether pre-contractual arrangements are commonly used.
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Due diligence (including title investigation and searches of
public authorities).
Further, all transfers of title are sent to the tax authorities within a
few days after the completion date. The tax authorities assess the tax
consequences (mainly transfer tax and VAT) of a transaction. After
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Negotiation and execution of a sale contract.
When legally binding
■
When the parties are legally bound.
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Registration.
Depending on the wording, letters of intent can be binding under
Dutch law and can oblige the parties to effect a transaction. Great
care should be taken when entering into letters of intent, even when
such letters are expressed to be "subject to contract".
■
When title transfers.
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The length of the process.
Otherwise, the parties are legally bound when they enter the sale
contract.
Registration
Marketing
Given the diverse nature of the Dutch real estate market, many forms
of marketing can be used. Larger portfolio transactions are typically
marketed as controlled auctions with the involvement of investment
banks and/or the larger international real estate brokers.
Real estate brokers are involved in most corporate real estate
transactions, whether large or small.
Commercial negotiation
Commercial negotiations are typically conducted by the sellers and
the bidders with the help of real estate brokers.
The notarial transfer deed must be registered in the event of property
transfers (see Question 4). Share transactions are not registered in
any public register.
When title transfers
A transfer of real property is made by executing a deed before a civillaw notary in The Netherlands and the subsequent registration of the
deed by the civil-law notary. A transfer of title to shares in a real
estate company is effected by the execution of a notarial deed.
Length of the process
Pre-contractual arrangements
The process can take between several days and several months,
depending on the nature of the transaction.
These often consist of confidentiality agreements and letters of
intent (see below, When legally binding).
9.
What are the main legal documents? Is notarisation required?
Due diligence
Investigations should include:
■
Technical matters regarding the property.
■
Title research.
■
Planning and zoning.
■
Permits required for the use of the property.
■
Material contracts, including leases and property management
contracts.
■
Tax matters.
■
Environmental matters.
■
Quality of the tenant, if any.
A "contractual phase" or "obligatory phase" precedes any acquisition
of real estate. Once a contract of sale is signed, a deed of transfer
needs to be drawn up, executed before a civil-law notary and
registered with the Land Registry for the real estate to be transferred
to a buyer (see Question 4). Usually a notarial deed of mortgage is
executed on the same day as the execution of a deed of transfer, to
grant a bank security over the acquired real estate.
The sale contract is the only document which does not need notarisation and which does not need to be a notarial deed.
10. What kind of warranties is a seller usually required to give a
buyer:
■
On the sale of an individual commercial property?
■
In sales of large real estate portfolios or companies holding
real estate (consider due diligence, disclosure and contractual
issues)?
Warranties are usually given relating to:
Sale contract
■
Leases (if any).
A sale and purchase agreement is typically drawn up by the legal
advisers of the buyer (but not if there is a controlled auction).
■
Title to the property.
■
Encumbrances and third party rights.
PLC
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Country Q&A
A prudent buyer should conduct due diligence regarding the real
estate, and any legal entity holding the real estate, before committing to any corporate real estate transaction.
■
Technical property matters.
■
Costs of due diligence.
■
Environmental matters.
■
Costs of drawing up the sale and purchase contract.
■
Planning and zoning.
■
Costs of executing and registering the deed of transfer and the
deed of mortgage.
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Material contracts.
■
The commission of the real estate broker.
■
Tax.
■
All relevant information having been disclosed.
The seller usually only bears the costs of its advisers in respect
of drawing up the contract of sale.
In addition in the sale of companies holding real estate, the
following warranties are also given:
■
Financial warranties, including a balance sheet warranty.
■
The absence of claims and litigation.
11. How are acquisitions of large real estate portfolios or companies
holding real estate generally financed?
Country Q&A
Larger transactions are generally financed by a combination of cash
(equity) and debt secured by a mortgage for the benefit of the lender
and pledges of lease income. Rules on financial assistance restrict
the financing of real estate company acquisitions based on security
provided by the target companies.
REAL ESTATE TAX
15. Is value added tax (VAT) (or equivalent) payable on the sale or
purchase of corporate real estate? Who pays? What are the
rates? Are there any exemptions?
VAT, at a rate of 19%, is only payable in respect of newly
constructed real estate (that is, for less than two years after the first
occupation) and building sites. No transfer tax is payable on this
type of real estate. There are no exemptions to this application of
VAT.
If a property is used (by either the owner or the tenants) for rendering
services or manufacturing products in connection with which VAT is
levied, a joint request by a seller and a buyer to have VAT (at a rate
of 19%) levied in respect of a property can be made.
12. Can an owner or occupier be liable for matters relating to the
real estate even if they occurred before it bought or occupied it?
For example, environmental liability, or liability under a lease.
It is highly recommended to have an expert assess the tax
consequences of acquisitions before structuring the acquisitions.
Tax laws may change in the course of the year.
It is primarily the polluter who is responsible for any environmental
damage. However, in the event of urgent and serious contamination,
the owner can be obliged to carry out remediation. In addition, local
authorities can require remediation activities to be carried out before
issuing building permits.
16. Is stamp duty/transfer tax (or equivalent) payable on the sale or
purchase? Who pays? What are the rates? Are there any exemptions?
13. Does a seller or occupier have any liabilities relating to the real
estate after it has disposed of it? For example, environmental
liability, defects in the real estate, contractual liability to the
buyer, or liability for releasing charges secured on the real estate.
A seller can have post-closing liabilities if the sale and purchase
agreement and/or the notarial deed provides for warranties or other
post-closing obligations for the seller. In addition, the seller could be
liable in the event of fraud or wilful default. If a seller has caused
contamination, it can be held liable for any resulting damage.
14. What costs are usually paid by the buyer? What costs are usually paid by the seller?
As well as transfer tax and or VAT, the following costs are usually
paid by the buyer:
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PLC
Transfer tax, at a rate of 6%, is payable on the transfer of real estate
if no VAT is levied by operation of law (see Question 15). Transfer
tax is also payable on the transfer of shares in a company which
mainly holds real estate.
A number of exemptions exist, for instance in relation to:
■
The transfer of a limited number of shares of a company which
mainly holds real estate.
■
Intra-group transfers of real estate.
■
The transfer of real estate within six months of acquisition.
17. Are any methods commonly used to mitigate real estate tax liability on acquisitions of large real estate portfolios?
Acquiring the shares of a company that mainly holds real estate may
mitigate transfer tax. A number of ways to mitigate transfer tax are
not entirely risk-free, as the anti-avoidance doctrine fraus legis could
be invoked by the tax authorities in the event of aggressive tax
structuring.
REAL ESTATE FINANCE
23. How can corporate real estate be used to finance a business?
In particular through:
HOLDING BUSINESS PREMISES
18. Is it common for companies to manage their real estate portfolios and their accommodation needs by using third parties, for
example through outsourcing transactions?
The management of real estate portfolios is often outsourced by
companies to third parties.
19. Are there restrictions on foreign ownership or occupation of real
estate, or on foreign guarantees or security for real estate ownership or occupation?
There are no restrictions on such foreign ownership or guarantees.
Acquisitions by certain legal entities such as trusts may need to be
assessed, in order to be fully informed about possible tax
consequences.
■
Secured lending.
■
Sale and leasebacks.
■
Other financing such as real estate securitisation.
Most real estate is financed on the basis of mortgage loans,
sometimes refinanced through securitisation. Anglo-American
investment banks have become more active in the Dutch property
finance market and are actively looking for securitisation transactions involving Dutch real estate.
Sale and leaseback transactions are still common on the Dutch
real estate market. Recently, Vendex KBB (Maxeda) sold its retail
portfolio for a published amount of about EUR1.3 billion (about
US$1.7 billion).
CORPORATE REAL ESTATE LEASES
24. Are rents or lease terms regulated, subject to a voluntary
code, or freely negotiable?
Change of control of a company does not affect its holdings of real
estate but it will usually trigger transfer tax.
Regulation of leases depends on the nature of the lease, that is,
retail, offices, industrial or residential. In short, office and
industrial leases are freely negotiable, but restrictive statutory
law applies to retail leases and, to a larger extent, to residential
leases.
Under certain circumstances, a change of control in a company can
trigger the Municipal Preferential Rights Act, entitling the municipality to a right of first refusal regarding the real estate (see Question
21).
25. What are the typical terms of a lease (whether contractual or
regulated) of business premises relating to:
21. In what circumstances can local or state authorities purchase
business premises compulsorily? Is the purchase price market
value?
■
Length of lease term?
■
Rent review?
In exceptional situations, and if required by the public interest,
authorities have the right to purchase business premises compulsorily.
■
Disposal?
■
Repair?
The authorities are required to compensate the owner, but not
necessarily at market price level.
■
Insurance?
Under the Municipal Preferential Rights Act, local authorities can
create a right of first refusal in respect of real estate in the event of,
for example, urban redevelopment.
Length of lease term
22. Are municipal taxes paid on the occupation of business premises, for example business rates? Are there any exemptions?
■
Retail: usually five years plus five years extension.
■
Offices: usually five to ten years initially.
■
Industrial: no typical term.
■
Residential: indefinite period of time.
Local taxes are levied annually on ownership or use of all types of
real estate. Local property tax is based on market value or square
footage of the property.
PLC
This depends on the nature of the lease (retail, offices, industrial or
residential):
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Country Q&A
20. Does change of control of a company affect its holdings of real
estate?
Rent review
This usually occurs after the end of each term and is usually
based on changing market rents, depending on the nature of the
lease and the specifics of the agreed terms. During the lease
term, the rent is typically reviewed annually in line with inflation.
Disposal
■
Causes damage to the property or other behaviour contrary to
good tenancy.
■
Does not use the premises.
■
Becomes bankrupt.
A tenant can terminate the lease in the event of the landlord's
default and in the event of the tenant's bankruptcy (see Question
29).
Sale of the property does not affect the lease.
The permission of the landlord is usually required for subletting.
Subletting to affiliates of the tenant is usually permitted. Assignment of the lease requires the landlord's consent. In certain
circumstances, the tenant may request a court to approve
replacement of the tenant by a third party.
Repair
This depends on the nature of the lease and the specifics of the
agreed terms. In general, the landlord is responsible for the costs
of exterior maintenance and the tenant normally pays for the
interior maintenance of the leased premises.
Insurance
This depends on the nature of the lease and the specifics of the
agreed terms. Usually, the owner is responsible for the insurance.
If the specific use by the tenant results in a higher premium than
normal, the surplus is paid by the tenant.
29. What is the effect of the tenant's insolvency (under general
contract terms and insolvency legislation)?
Under the Dutch Bankruptcy Act, a tenant can terminate the
lease prematurely in case of bankruptcy. Usually, the lease
provides for the right of the landlord to terminate the lease in the
event of the tenant's bankruptcy.
30. Do tenants of business premises have security of occupation
or rights to renew the lease at the end of the contractual
lease term? If so, please give details.
Whether tenants of business premises have security of occupation or rights to renew depends on the nature of the lease and the
specifics of the agreed terms. All tenants have, to a certain
extent, protection after the agreed lease term expires. The nature
of this protection differs. In summary:
Country Q&A
26. Is VAT (or equivalent) payable on rent?
Rent payments are VAT exempt. However, the parties can elect
for the rent to be subject to VAT, provided certain requirements
are met, including 90% or more of the tenant's activities being
subject to VAT.
■
Office and industrial: protection up to maximum three years
after the expiry of the agreed term.
■
Retail (and residential): limited grounds for the landlord to
terminate the lease after the agreed period has expired.
PLANNING LAW/ZONING
27. Can named tenants usually share their business premises
with companies in the same corporate group? If so, on what
terms?
31. What is the institutional framework of planning control?
Tenants can only share their business premises with companies
in the same corporate group if this is stipulated in the lease,
which is usually the case.
The municipal authorities designate the permitted use of land in
a zoning plan. In the event of envisaged construction deviating
from the zoning plan, exemptions based on Article 19 of the
Spatial Planning Act need to be requested. Such exemptions
require the approval of the Provincial Executive.
28. What events typically give the landlord and the tenant a right
to terminate the lease (under general contract terms and any
applicable legislation)?
32. When is planning permission required?
The landlord can typically terminate the lease if the tenant:
■
Exemptions based on Article 19 of the Spatial Planning Act need
to be requested in the event of envisaged deviations from the
zoning plan.
Fails to make timely rent payments or other material
defaults under the lease agreement.
150
Building permits are required for the construction of new
buildings and for structural changes to buildings.
PLC
33. If planning permission is required:
Duration
■
To which body or bodies are initial planning applications
made?
■
Do third parties have the right to object?
■
In what circumstances is there a public inquiry?
The time frame of the whole procedure mostly depends on
whether objections are made by the public, and on the size and
nature of the development project. Simple building permits are
sometimes issued within weeks, but the planning and zoning
procedures relating to a major development project can take
many months or even years.
■
After how long from the application does an initial decision
take?
REFORM
■
Is there a right of appeal?
■
About how long does the whole procedure take?
Applications
Applications should be made to the municipal authorities and, in
certain circumstances, to provincial authorities.
Third party rights
Third parties have the right to object. Different objection
procedures exist at municipal and provincial level, depending on
the nature of the planning decision being objected to. Typical
objection procedures include objections against building
permits, the granting of environmental permits and against
exemptions based on Article 19 of the Spatial Planning Act (see
Question 32).
Public inquiries
The national government is planning to integrate certain zoning
and planning procedures to allow for more "one-stop-shopping".
The government intends the reforms to take effect during 2007.
Other important reform proposals include envisaged changes to
the Dutch limited liability company (BV) regime, allowing for
flexibility in structuring a BV company to suit the needs of the
shareholders. The proposals include a radical change to the
financial assistance restrictions. Enactment of the proposals is
not expected before the end of 2007.
CORPORATE REAL ESTATE WEBSITES
35. Please list a maximum of five website addresses for government authorities and industry bodies relevant to corporate
real estate.
Ministry of Housing, Spatial Planning and the Environment. The
Ministry regulates certain planning issues.
W www.vrom.nl
Initial decision
Initial decisions must generally be taken within 12 weeks after
application, depending on the nature of the application.
Real Estate Information Centre of the Amsterdam School of Real
Estate. This website contains publications on various real estate
issues.
W www.vastgoedkennis.nl
Appeals
Interested parties have the right to appeal to the courts
concerning all planning decisions once the relevant objection
procedures have been followed.
Municipal websites. These websites contain real estate information on the relevant cities, for example:
W www.amsterdam.nl; www.rotterdam.nl
Property NL. This is a research organisation and publisher
specialising in commercial real estate.
W www.propertynl.com
PLC
151
Country Q&A
Any envisaged planning decision is made available for public
inspection. Interested parties can express their views in writing
and sometimes public hearings are held.
34. Please summarise any proposals for reform and state whether they are likely to come into force and, if so, when.
Your
law firm in
the Netherlands
Gustav Mahlerplein 2
1082 MA Amsterdam
the Netherlands
Boekel De Nerée has a market-leading Commercial Real Estate
Department in the Netherlands. Over 60 lawyers provide specialist
expertise and experience in a wide range of commercial propertyrelated areas. The Department includes a Corporate Real Estate
Group focused on property transactions, providing practical and commercial solutions to institutional investors, financiers, developers
and (end)users. The Corporate Real Estate Group has particular
expertise in the field of cross-border transactions.
Contact: David van Dijk Tel: (31.20) 795 34 17
E-mail: [email protected]
www.boekeldeneree.nl

The Netherlands

Transcription

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