SOURCE: Marks Paneth & Shron LLP

Marks Paneth & Shron LLP

May 21, 2013 10:00 ET

Commercial Real Estate Limited Partnerships Can Be Great Opportunities -- But Too Many Limited Partners Mess Up by Failing to Do the Due Diligence

Invest in Commercial Real Estate Limited Partnerships as if It's a "Hollywood Marriage"; There Can Be Great Benefits, But It Will Most Likely End, Says Marks Paneth & Shron Partner

NEW YORK, NY--(Marketwired - May 21, 2013) - Commercial real estate can be lucrative for investors in the growing market of commercial property limited partnerships. However, investors can still potentially lose money despite owning a great property if they fail to perform the right due diligence.

That's according to a new video from New York accounting firm Marks Paneth & Shron LLP (MP&S).

Narrated by Abe Schlisselfeld, Partner in MP&S's Real Estate Practice, the video delineates the common errors limited partners make and should avoid making. For instance...

  • Understand the operating agreement. It's important to know who is running the deal and how they are paid. Investors should look at how taxable income and losses are allocated among investors and how the cash is distributed. Failure to do so could result in a large amount of taxable income and no cash to pay taxes.

  • Do your homework. It's easy to be swayed by a fancy address or neighborhood. When investing as a limited partner, be sure to look out for things that could negatively affect the property, such as its past financials and current leases.

  • Look closely at taxes. When investing as a limited partner, there are a few complicated tax issues that could limit losses. In addition, the new Medicare tax can increase taxes owed. It's also important to look closely at state tax requirements.

  • Timing is everything. In order to get the most out of your investment, you should be able to recognize when the time has come to get out. Monitor the property and its value, even when it's bringing in a lot of income.

The video is available at http://www.markspaneth.com/publications/straight-talk-for-real-estate-limited-partners.

For more information or to speak with Abe Schlisselfeld of Marks Paneth & Shron, please contact Katarina Wenk-Bodenmiller of Sommerfield Communications, Inc. at (212) 255-8386 or katarina@sommerfield.com.

About Marks Paneth & Shron LLP

Marks Paneth & Shron LLP is an accounting firm with over 500 people, of whom nearly 65 are partners and principals. The firm provides public and private businesses with a full range of auditing, accounting, tax, consulting, bankruptcy and restructuring services as well as litigation and corporate financial advisory services to domestic and international clients. The firm also specializes in providing tax advisory and consulting for high-net-worth individuals and their families, as well as a wide range of services for international, real estate, media, entertainment, nonprofit, professional and financial services, and energy clients. The firm has a strong track record supporting emerging growth companies, entrepreneurs, business owners and investors as they navigate the business life cycle.

The firm's subsidiary, Tailored Technologies, LLC, provides information technology consulting services. In addition, its membership in Morison International, a leading international association for independent business advisers, financial consulting and accounting firms, facilitates service delivery to clients throughout the United States and around the world. Marks Paneth & Shron LLP, whose origins date back to 1907, is the 32nd largest accounting firm in the nation and the 16th largest in the New York area. In addition, readers of the New York Law Journal rank MP&S as one of the area's top forensic accounting firms for the third year in a row.

Its headquarters are in Manhattan. Additional offices are in Westchester, Long Island and the Cayman Islands. For more information, please visit www.markspaneth.com.

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