Christine Daric, tax lawyer and BCLP partner: “There is no tax definition of a warehouse”

A tax lawyer since 1998, Christine Daric nevertheless hated her law studies. What reconciled her with the legal world was real estate. “At law school, there was a great deal of theory and little room for creativity,” she explains. “I needed something more concrete, and I discovered this sector, made up of inventive and highly resourceful people.”

Her interest in logistics came later. “Until the mid-2000s, there were few large-scale transactions in the logistics sector. But gradually, complex, high-stakes deals emerged, and logistics real estate players increasingly needed the support of specialist lawyers.” While warehouses have become essential to economic life over the years, their tax status has still not been clarified. “There is no tax definition of this asset: for each tax, we try to squeeze it into a shoe that does not fit.”

The particularities of logistics real estate gradually became a fascinating day-to-day focus for Christine Daric. The lawyer has defined two areas of practice. First, she works alongside logistics real estate owners, or those about to become owners, in collaboration with notaries, brokers, banks and others. “The matters concern the financing and structuring of a transaction, the tax classification of a property when work is carried out, the development tax…,” Christine Daric quickly lists. “My second role is to work alongside Afilog: on the one hand, to lead the tax committee; and on the other, to assist the association in its discussions with public authorities, particularly when amendments are tabled. We must constantly explain and re-explain what logistics is and just how indispensable it is to economic activity. We have to keep making complex matters clear.” These exchanges within Afilog also give her insights into certain logistics players, such as pure-play logistics providers, whom she would not otherwise have encountered.

Among the notable lobbying efforts, Christine Daric singles out one in particular—one of the first undertaken alongside Afilog. “In 2010, when the levy on the creation of office space was extended to storage facilities in order to fund Grand Paris works,” she recalls, “the rate was very high and risked bringing the development of logistics assets in the Île-de-France region to a halt. So we worked together to identify a rate that would be acceptable to the sector, and the law was ultimately amended accordingly, which was a source of great satisfaction.”

Today, she believes the major risk is that warehouses—already heavily taxed—will be overtaxed, even though these structures have a relatively low cost price. It is vital, for example, to ensure that property tax does not undergo further increases that would be unbearable for businesses, as happened in 2018, notably because logistics sites were reclassified as industrial establishments; or that the development tax does not exceed the price of the land, as can happen in certain municipalities. “In such cases, it becomes clear that the situation is not viable for logistics real estate players, who consequently abandon their projects,” she stresses.

Another case has stayed with her because of the creativity required to bring it to fruition. “An investor—a foreign fund managed by a private bank—wanted to enter logistics real estate through a transaction worth more than €120 million,” the lawyer recalls. “We had to find technical solutions to structure the transaction in a way that minimized acquisition and exit costs, working closely with the asset manager to define the work required to meet the façade criterion for classifying the buildings as new buildings—a criterion that is not straightforward for logistics warehouses.” More generally, what motivates her to practice her profession is having to find, for every case, the most appropriate interpretation of the French General Tax Code so that transactions which otherwise would not have come about can proceed.

Although fulfilled in her work as a tax lawyer, Christine Daric is keen to point out that it is also a highly demanding profession that often spills over into personal life. “Our schedules do not belong to us; they belong to our clients. Vacations do not really exist either,” she says by way of illustration. “I love this daily life, but you need to be aware of its constraints in order to thrive in it.”