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Keywords:

  • single-purpose entity (SPE);
  • bankruptcy-remote entity;
  • independent director;
  • substantive consolidation

Abstract

Single-purpose entities are commonly required by lenders in commercial real estate financings in the USA. This paper will review the risks against which protection is sought through the single-purpose entity structure, the elements of a ‘single-purpose entity’ and a ‘bankruptcy-remote’ entity, common objections of owners and investors to using these structures, and some key holdings of US courts in this area. Copyright © 2005 Henry Stewart Publications