Companies registered overseas own more than a billion pounds' worth of real estate in the West Midlands - including several office units in Birmingham that sold for more than £138 million.
Data released for the first time by the Land Registry has revealed that foreign-registered companies own properties in the region worth at least £1.57 billion - and likely far more.
The most expensive real estate bought by an offshore company in the West Midlands, where we know the price, was 8-28 Colmore Circus Queensway in Birmingham (which included even numbers only).
The units were bought by Investment Birmingham S.A.R.L. - registered in Luxembourg - who paid £138,150,000 for the coveted office space.
Similarly, offices at One Colmore Row in Birmingham were bought for £125,000,000 by Union Investment Real Estate GmbH, a company which is registered in Germany.
Meanwhile, Pavilion Property Trustees Limited, which is registered in Jersey, bought 33 Bull Street - which houses Birmingham County Court and the Civil Justice Centre - for £87,500,000.
The company also bought land and buildings on the north east side of Bull Street for a similar price.
While Birmingham saw the highest amounts paid by companies registered overseas for properties in the West Midlands, other parts of the region also saw big investments.
In Solihull, for example, Sipl Sunrise Propco S.A.R.L. - which is registered in Luxembourg - bought a building that houses Birchmere Care Home on Warwick Road for £32,570,000.
Meanwhile, the Butts Centre at City College Coventry was bought for £20,425,000 by Earlsdon Park Limited, which is registered in the Isle of Man.
There’s no ban on foreign companies buying UK property, and no suggestion that these companies are doing anything wrong.
However, while the figures also include some residential properties, commercial property in the UK being owned by foreign-registered companies has major ramifications when it comes to selling it on.
A legal loophole means that, while a UK individual or company will have to pay corporation tax when they make money selling commercial real estate, foreign companies will not.
It’s estimated that a third of all commercial properties in the UK are owned by offshore companies - which are typically based in tax havens - and closing the loophole could raise between £5bn and £8bn in tax a year.
'It’s not fair'
Stella Creasy, Labour and Co-operative MP for Walthamstow, has been leading a campaign to close the legal loophole that means foreign companies don't have to pay tax on profits made on commercial property in the UK. She says:
“It’s not fair that when British businesses sell commercial properties they pay tax on the gains they have made, but overseas companies don't.
“These eye-watering figures show it’s a tax loophole that's costing British taxpayers billions of pounds, as these trusts pocket massive profits tax free - enough to fund a proper pay rise for public sector workers, or tackle the waiting lists in the NHS.
“Most other countries do tax these profits but our Government refused, voting down a recent amendment to the Finance Bill and saying it was too complicated for them to introduce.
“This data shows we can't let them get away with such paltry excuses for letting these foreign companies do this - British businesses deserve a level playing field and British public services deserve proper funding.”
