The Benefits of a Real Estate Holding Company for a Business Owner’s Liability Protection

The Benefits of a Real Estate Holding Company for a Business Owner’s Liability Protection

Traditionally, many businesses are formed under a single company that owns all the business assets (including the real estate) and operates the business. This structure is simple and easy to manage. But, it does not take advantage of certain liability protections that might make an enormous difference for the business owner.

This protection is primarily accomplished with a “real estate holding company.” The major benefit of this structure is to gain extra liability protection. For example, if the “operating business entity” is sued and could be exposed to a large judgment, the real estate and any other assets in the “real estate holding company” should be shielded from liability.

Establishing this protection as not as simple as forming a new LLC and transferring the real estate into it. Among other items, a lease agreement needs to be executed between the real estate holding company and the operating business entity that addresses several important issues. A deed needs to be drafted in a particular way to avoid transfer taxes and a re-assessment of the property taxes. Also, a business owner needs to conduct his or her affairs in such a way that respects the independence of each legal entity.

An experienced business attorney is in the best position to help you with gaining this liability protection. If you are interested in discussing whether creating a real estate holding company is the right fit for your business, please do not hesitate to contact me.


Cunningham Dalman, PC publishes this web site and its component parts to inform users about our firm, our attorneys and general new developments in the law. The web site and blogs are not intended as legal advice on any matter. There are many factors that may affect your situation. You should not act or refrain from acting because of information found here without first seeking appropriate legal or other professional advice from someone who is familiar with your particular circumstances.

In the operation of this web site and our blogs, we do not intend to create an attorney-client relationship with you and no such relationship shall be created by your use of this web site. Such a relationship can only be established to the extent an attorney at Cunningham Dalman, PC expressly agrees to undertake the relationship. Please do not communicate to us any information you regard as confidential unless and until we have established a formal attorney-client relationship with you. Any information you send to us before we establish an attorney client relationship may not be privileged or confidential. Information you send to us over the Internet may not be secure.

Our Practice Areas
Our Practice Areas

Recent Posts


Cunningham Dalman P.C.
PO Box 1767
321 Settlers Road
Holland, MI 49422-1767

Google Map


Scroll to Top

Tell Us How We Can Help You

Send us a quick message or call us at 616.392.1821!

Seminar Registration

Fill in the form below to reserve your spot today for each person attending. If you have any questions, please call the office at 616.392.1821.

Call Now Button