The real estate sector plays a crucial role in the global economy and social environment.

In particular, the commercial property sector offers the infrastructure needed for the growth and development of entrepreneurship and business, including offices, shops, industrial and logistics premises, and hotels. In Europe alone, commercial real estate represents a business of US$8.1 trillion.

Business operators often prefer to rent the spaces for carrying out their activity. Therefore, commercial properties are generally held as investments by third-party investors, who buy commercial properties and rent them to business operators.

The real estate sector is also a fundamental source of employment. In 2017, the European real estate sector employed 4 million people, more than the car manufacturing and telecommunications sectors combined. Moreover, it provides residential accommodation and is seen as a tool to meet social and public needs. New types of properties are emerging and have been increasingly included in investment portfolios, such as healthcare, senior living, education and student accommodation.

In this context, attracting new resources and investment from institutional investors, such as pension funds, insurance companies and sovereign wealth funds, is important for the improvement of the real estate sector. In particular, it is desirable that those investors are involved both in financing large development projects and in investing in properties held for rent.

Based on market practice, investments from foreign institutional investors are mainly carried out indirectly, rather than through direct acquisitions, especially through non-listed real estate funds, property companies and real estate investment trusts (REITs).

However, within Europe, the role of the real estate sector as an economic, employment and social catalyst needs to be supported by a legislative framework that increases transparency and competitiveness, and simplifies and standardises bureaucratic processes.

Within the European Union, legislation for the real estate sector differs from country to country and is strictly connected to the location of the real estate properties. For example, transfer taxes due for the disposal of real estate assets are applied based on national tax rules; in addition, in certain countries property taxes due on the ownership of real estate properties are determined and managed by local municipalities and not uniformly at a national level.

Furthermore, income deriving from direct investments in real estate properties under double taxation treaties is taxed in the state where the properties are located and, thus, in certain circumstances, there are negative tax consequences.

In response, national legislators are seeking to introduce and regulate new types of specialised vehicles for investment in real estate properties that may benefit from tax exemptions or other advantageous tax allowances for both direct and indirect tax purposes.

The aim of this volume is to provide a useful guide to those international and institutional investors willing to invest in real estate properties located in Europe, illustrating in a comparative manner different alternatives for the establishment of investment platforms in Europe and investment vehicles at a local level. In particular, each chapter provides insights from leading experts on the tax considerations and investment opportunities based on the specific national legislation.

We would like to thank the authors of this volume for their extensive expertise and for their effort to ensure the successful outcome of this work. We hope that the reader finds this volume useful and we would be grateful to receive any comments and suggestions for its improvement.