Amazon’s blockbuster acquisition of Whole Foods sent shockwaves through the stock market, as well as the retail industry last week. While the proposed $13.7-billion deal is eye-popping, expansion by acquisition is hardly new, though the implications for those in the retail CRE sector are complex and will take time to better understand.
A CRE industry leader who has more insight than most on what the deal may mean is Cushman & Wakefield’s national eCommerce fulfillment practice leader, Ben Conwell. He joined the firm after directing North American real estate operations for Amazon. Conwell offers unique insights regarding the real estate impact of the acquisition that Amazon had explored last year, though elected not to move forward at the time.
Read the full conversation here.
Florida is one of the only states in the country that levies a tax on commercial leases, and is the only state to do so in any comprehensive manner. Governor Rick Scott and the Florida legislature have been attempting to phase out this tax since 2014, with each legislative session ending in failure – until this year.
One of the final versions of House Bill 7109 permanently lowered the sales tax rate on commercial leases to 5.5% beginning January 1, 2020, with an even larger interim reduction to 4.5% until then. However, to actually achieve passage, the bill was watered down at the last minute.
The version of the bill ultimately approved by the legislature and signed by the governor on May 25, as a revision to Section 212.031, Florida Statutes, permanently reduces the sales tax rate on commercial leases in Florida to 5.8%, effective January 1, 2018. It is estimated that this will save Florida businesses approximately $61 million annually.
As before, there may be an additional county levy (e.g., an additional 1% in Hillsborough and Pinellas Counties). The statute was also amended to explicitly state that the tax rate applicable to any rental payment is the rate in effect during the period of occupancy relevant to such payment, not the time of payment of such rent. So the delay or acceleration of any rental payment is irrelevant to the rate applicable to the remittance.
We encourage our clients that are in any commercial leasing arrangement to account for this accordingly in their collections and remittances, beginning in 2018.
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This article has been written by Gregory Haney, Partner, Shumaker, Loop & Kendrick, LLP
Co-Working has become a huge global trend. According to Forbes almost 1.2 million people worldwide will have worked in a co-work space by the end of this year. Do you co-work or thinking are about co-working space? Let me know how I can help!
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