A real estate investment trust, also know as a REIT, is a company that owns, and in most cases, operates income-producing real estate. Some real estate investment trusts finance real estate. An unincorporated business trust is an organization created and managed by trustees for the benefit and profit of persons who hold or may acquire transferable trust certificates. Trust certificates are similar to stock certificates of a corporation; trust certificates provide individual holders evidence of interest in the trust estate.
An unincorporated business trust is created when one or more persons transfer the legal title in property to trustees, with power vested in the latter to manage and control the property and business and to pay the profits of the enterprise to the creators of the trust or their successors. The U.S. Supreme Court has defined such a trust as a form of business organization, common in Massachusetts consisting essentially of an arrangement whereby property is conveyed to trustees in accordance with terms of the Trust. The business is to be held and managed for the benefit of persons who hold transferable certificates issued by the trustees showing the shares into which the beneficial interest in the property is divided.
The Michigan Agreement and Declaration of an Unincorporated Real Estate Business Trust is a legal document used to establish and formalize an unincorporated business trust focused on real estate investments in the state of Michigan. This trust enables individuals or entities to pool their resources and invest in real estate properties as a collective entity. It provides a clear framework and terms for the operation and management of the trust, ensuring that all participants are protected and their interests are safeguarded. Some key components of the Michigan Agreement and Declaration of an Unincorporated Real Estate Business Trust include: 1. Purpose: Clearly stating the trust's objectives, whether it is to acquire, manage, lease, develop, or sell real estate properties in Michigan. 2. Trust Property: Identifying the real estate properties or assets that will be owned and managed by the trust. This could include residential, commercial, or industrial properties or even undeveloped land. 3. Beneficiaries: Defining the individuals or entities who will benefit from the trust's operations. These beneficiaries may receive income, profits, or distributions from the trust's real estate investments according to their respective ownership interests. 4. Trustees: Naming and outlining the duties and responsibilities of the trustees who will manage and administer the trust's activities. The trustees are typically responsible for making investment decisions, overseeing property management, handling legal matters, and ensuring compliance with applicable laws and regulations. 5. Contributions and Ownership Interests: Specifying the financial or non-financial contributions made by each beneficiary to the trust and the corresponding ownership interests they hold. This section may also detail how additional contributions or transfers of ownership interests can be made. 6. Voting and Decision-Making: Outlining the process and rules regarding voting and decision-making within the trust. This can include majority or unanimous consent requirements for important decisions such as property acquisitions, dispositions, financing, and lease agreements. 7. Distribution of Profits: Explaining how the trust's profits or income generated from the real estate investments will be distributed among the beneficiaries. It may include provisions for regular distributions, reinvestment, or reserves. 8. Dissolution: Describing the circumstances under which the trust may be dissolved, including voluntary termination or court-ordered dissolution. This section usually outlines the process for winding up the trust's affairs and distributing any remaining assets to the beneficiaries. It's important to note that while the Michigan Agreement and Declaration of an Unincorporated Real Estate Business Trust serves as a comprehensive framework for establishing such trusts, there may be different variations or customized agreements according to specific requirements or circumstances. These variations may include different provisions, exclusions, or additional clauses tailored to the specific trust's needs, objectives, or preferences.
