BY ALESSIA PIROLO

In August, Deloitte’s global headquarters relocated to a new 430,000-square-foot office at 30 Rockefeller Plaza, for which the company had inked an 18-year lease in early 2011. Over the past year, Deloitte expanded to 193,000 professionals globally, with more than 51,400 new hires. In New York, its workforce shot up seven percent to nearly 5,400 professionals, according to officials at the global brokerage firm.

“It was a real estate strategy in place to ensure our office space throughout the tristate [area] provides a work environment that enables productive collaboration of our professionals, maximizes space efficiencies and is economically beneficial,” said Henry Phillips, a vice chairman and northeast regional managing partner with Deloitte.

In 2012, Deloitte was one among many of New York’s top 25 accounting firms to embark on a hiring spree that would subsequently trigger a massive hunt for expansion space, analysts told The Commercial Observer. In the past few months, several accounting firms closed deals for new offices in Manhattan.

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BY DANIEL GEIGER

When the economic downturn hit, it brought real estate values plummeting. Now that prices have returned to near pre-recession levels, however, some landlords hardest hit by the distress that cropped up during the tumult could be on the hook for a hefty tax bill.

The issue traces to a common scenario in the kind of workouts that were often done to bring a building back from the brink of financial trouble.

To get at distressed property, many prospective buyers bought the debt tied to a building—often at a discount—in order to seize the asset. Rather than go through costly and arduous foreclosure proceedings, however, these note holders often dangled small continued ownership stakes in a building in order to induce the existing landlord to voluntarily hand over the keys.

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BY CARL GAINES

Moving leases—real estate, equipment or otherwise—onto balance sheets has been kicked around for some time now, but an agreement recently reached by the International Accounting Standards Board and the Financial Accounting Standards Board could signal that change is actually coming.

Sources told The Commercial Observer that the initiative, which caught fire as “transparency” became a buzz word in the midst of the financial crisis, could have major implications for lessees of commercial real estate, particularly those that lease multiple or large blocks of space.

Stephanie Urbanski, a global real estate sector resident & assurance senior manager at Ernst & Young, pointed out several of these implications. They include changes in balance sheet metrics, such as leverage and capital ratios, decreased borrowing capacity and decisions by some lessees to buy rather than rent.

“Their current loan agreements may say that they must have a debt-to-asset value of some number,” Ms. Urbanski said. “If you’re increasing the debt-balance, that gives them less borrowing capacity.”

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BY ALESSIA PIROLO

The complexity of United States tax law and the penalties associated with noncompliance can be daunting for the increasing number of foreigners eager to invest in United States real estate, several international tax experts told The Commercial Observer.

The Foreign Account Tax Compliance Act and the Report of Foreign Bank and Financial Accounts are only a few of the acronymic accounting regulations foreign investors and accountants are now faced with navigating in order to successfully acquire property in the United States from afar.

Despite those complexities, however, foreign investors are still increasingly attracted to a real estate market they perceive as comparatively stable amidst uncertainty in Europe. Indeed, during the second quarter of 2012, global investor purchasing activity in the United States grew by 33 percent from the previous quarter, according to a Jones Lang LaSalle Global Capital Flow Report.

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BY JOTHAM SEDERSTROM In a reversal from just two years ago, lenders are once again agreeing to write down outstanding bank loans extended to real estate investors as the economy continues to rebound, analysts said. As fundamentals such as rental rates and vacancy rates continue to improve, lending institutions such as J.P. Morgan Chase are increasingly willing to green-light write-downs, what accountants describe as a reduction in the book value of the real estate asset in question. “First of all, the banks’ balance sheets are a lot stronger today than they were in 2009 and that gives them a lot more capacity for doing this,” said Robert O’Brien a vice chairman and U.S. real estate services leader at Deloitte. “And, besides that, we’re just seeing better fundamentals.” To read the full story, click here.