Property Special Purpose Vehicles (SPV)

A Special Purpose Vehicle (SPV) is a company set up to capture value from property related project/s. SPVs are usually set up for a specific purpose – property developers, investors and lenders frequently use SPVs to manage risks associated with their developments, many of which may have different investor profiles.

As well as supporting clients with the financing of properties within an SPV, we have partnered with a specialist to assist our clients in accessing profits from an SPV at the end of the development process.

WHAT’S CHANGED FOR OWNERS OF PROPERTY SPVs?

Once a development has completed, and at the end of an SPV’s life, a typical route for accessing profit has been to enter into a Members Voluntary Liquidation (MVL) where profits in the SPV are distributed in accordance with shareholdings. However, a recent piece of legislation – the Finance Act 2016 – changed the way distributions in an MVL may be treated, resulting in a large number of these being completed in early 2016.

These new rules have meant up to an 18-month wait for tax clearance, meaning delays for developers in moving on to other projects and uncertainty whilst they wait for completion of the process. We strongly recommend anyone using or planning to use an SPV seeks expert advice.

HOW CAN ENNESS HELP WITH MY PROPERTY SPV?

To assist our clients with their requirements in this area, we have partnered with a specialist acquirer of property SPVs in order to access profit and avoid the cost and risk associated with ongoing ownership. This specialist can pay for your property SPV in 30 days, providing a risk free alternative to MVL, no ongoing liabilities and certainty in terms of outcome.

The service is backed by a bespoke £800million insurance policy from Zurich, providing a guarantee for the acquisition of your SPV.

To speak with one our expert brokers about your property SPV, get in touch with the team at Enness.

 

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