If the Empire State Building has an IPO - like Malkin Group intends - some current investors could experience significant taxes attached to it, according to Reuters.
The information was announced in a filing with the U.S. Security and Exchange Commission, showed that the Malkin Group would receive tax-exempt operating units as well as super-charged Class B shares of the proposed real estate investment trust. The OP units would not be available to other investors, the news source said. Regular investors would receive shares that would be frozen for 180 days. While they would not be able to be sold during this time, the government would still tax these items.
The Class B shares, which Malkin Group would have, are worth 50 votes each in the REIT, the news source said. The Class A shares given to other investors would be equal to one vote.
This is the latest in a series of issues since the commercial real estate investment trust proposal for the iconic building was announced, the news source added. The company has dealt with a series of lawsuits due to many investors feeling that Malkin Group has an inside track to success for the shares, compared to the rest involved.