How to Startup a Real Estate Fund: Legal and Tax Strategies for Small Business Success

Matthew E. Rappaport | Falcon Rappaport & Berkman LLP

Matthew E. Rappaport, Esq., LL.M., is a Partner at Falcon Rappaport & Berkman LLP and serves as Chair of the firm’s Taxation and Private Client Groups. His practice focuses on taxation matters related to real estate, closely held businesses, private equity funds, family offices, and trusts and estates. He advises clients on tax planning, structuring, and compliance across a wide spectrum of transactions, including commercial real estate projects, business life cycle planning, generational wealth transfer, family business succession, and executive compensation. Known for his work on complex, tax-sensitive transactions, he regularly handles matters involving Section 1031 exchanges, Qualified Opportunity Zones, freeze partnerships, private equity mergers and acquisitions, and Qualified Small Business Stock. He also collaborates closely with attorneys, accountants, financial advisors, bankers, and insurance professionals, and serves as a trusted advisor to real estate funds, multinational executives, venture capitalists, startup businesses, and ultra-high net worth individuals.

• Education & Credentials

Matthew E. Rappaport earned both his Juris Doctor and Master of Laws in Taxation from Georgetown University Law Center. He is admitted to practice in the State of New York and before the United States Tax Court, reflecting his qualifications to handle sophisticated tax matters across jurisdictions.

• Recognition & Leadership

Matthew holds a leadership position as Chair of the Taxation and Private Client Groups at Falcon Rappaport & Berkman LLP, demonstrating his authority and experience in complex tax matters. He is widely recognized for his work on advanced tax-driven transactions, including Section 1031 exchanges, Qualified Opportunity Zones, freeze partnerships, private equity mergers and acquisitions, and Qualified Small Business Stock, and is regarded as a trusted advisor for high-level clients and sophisticated financial matters.

• Professional Involvement

In his practice, Matthew frequently collaborates with a range of professionals, including attorneys, accountants, financial advisors, bankers, and insurance specialists, particularly when matters require advanced tax law expertise. His involvement in these multidisciplinary efforts underscores his role in facilitating complex transactions and delivering integrated tax guidance.

• Experience

Matthew’s experience includes advising clients on tax planning, structuring, and compliance for commercial real estate projects, all stages of the business life cycle, generational wealth transfer, family business succession, and executive compensation. He has worked with prominent real estate funds, executives of multinational corporations, venture capitalists, startup businesses, and ultra-high net worth families, providing creative, tax-focused solutions to complex and challenging matters.

SESSION 1 – Fund Structuring and Lifecycle | 1:00pm – 1:20pm

Examine the formation and operation of real estate investment funds from inception through exit, including investment strategies, governance structures, fee arrangements, promotes, investor protections, and control provisions commonly negotiated throughout the fund lifecycle.

SESSION 2 – Fundraising and Documentation | 1:20pm – 1:40pm

Explore private offering compliance requirements and the core documentation used in real estate fund formation, including private placement memoranda, operating agreements, subscription materials, side letters, and investment management agreements.

SESSION 3 – Partnership Tax Considerations | 1:40pm – 2:00pm

Analyze key partnership tax issues affecting real estate funds, including special allocations, tax distributions, §754 elections, and partnership audit rules that influence fund operations, investor relations, and transactional planning.

BREAK | 2:00pm – 2:10pm

SESSION 4 – Real Estate Operational Issues | 2:10pm – 2:30pm

Review operational and transactional considerations impacting real estate investments, including diligence related to title, zoning, and environmental matters, along with leasing, property management, and asset oversight concerns.

SESSION 5 – Investor and Reporting Dynamics | 2:30pm – 2:50pm

Discuss investor-specific considerations and ongoing reporting obligations, including exchange-driven investment constraints, investor communications, financial reporting expectations, and K-1 preparation and distribution workflows.

SESSION 6 – Risk Management and Common Pitfalls | 2:50pm – 3:10pm

Identify common legal and operational risks in real estate investment funds, including conflicts of interest, related-party transactions, disclosure obligations, governance disputes, and practices that help minimize exposure and investor conflict.