Commercial real estate investment in Turkey offers foreign companies the opportunity to acquire income-generating properties such as office buildings, logistics centers, shopping malls, hotels, and industrial warehouses. While the Turkish market provides high rental yields and long-term capital growth, investors must also understand the legal and fiscal implications of such transactions. Unlike residential real estate, commercial property acquisitions are subject to different tax regulations, zoning compliance, and VAT applications that must be strategically planned in advance.
At our Turkish Law Firm, we advise international corporate clients on structuring their commercial real estate investments in full compliance with Turkish tax law and foreign ownership regulations. Our English speaking Turkish lawyers assist in SPV incorporation, contract drafting, tax exemption planning, and registration with the relevant authorities. Recognized as a best lawyer firm in Turkey for real estate and corporate law, we deliver seamless legal support from due diligence to post-acquisition optimization.
Types of Commercial Real Estate Available to Foreign Companies
Foreign companies can legally acquire various categories of commercial property in Turkey, including but not limited to:
- Office towers and business parks
- Hotels and tourism-related real estate
- Retail units, shopping center lots, and street-level stores
- Warehouses, distribution centers, and industrial facilities
- Development land zoned for commercial use
Our Istanbul Law Firm reviews zoning plans (imar planları), title deed records (tapu bilgisi), and municipality approvals before signing any purchase agreement. For foreign corporate clients, we provide investment compliance opinions and assess restrictions based on location, land classification, and usage rights. Our English speaking Turkish lawyers also assist in acquiring permits for renovation, conversion, or license change where necessary. Working with a trusted Turkish Law Firm ensures your property is not only acquired legally, but also fully usable for business activity or leasing.
Tax Implications of Commercial Property Investment in Turkey
Unlike residential property, commercial real estate acquisitions in Turkey are subject to Value Added Tax (VAT) at a standard rate of 18%—unless the buyer qualifies for an exemption under the Investment Incentive Program or makes the purchase through a company registered in a VAT-exempt status. Additionally, income from commercial rental properties is subject to corporate income tax (currently 20–25%) and, if distributed, may be subject to withholding tax on dividends. However, Turkey has tax treaties with over 80 countries that reduce or eliminate this burden when the income is transferred abroad.
Our Turkish Law Firm prepares tax optimization roadmaps for foreign companies investing in Turkish real estate. We work closely with chartered accountants to apply accelerated depreciation methods (amortisman) and calculate optimal holding periods to reduce exit tax exposure. Our English speaking Turkish lawyers also advise on transaction structuring to split VAT and title deed taxes across entities when multiple assets are acquired. As a best lawyer firm in Turkey for real estate taxation, we ensure your investment is legally sound and financially efficient.
Using SPVs and Holding Structures for Asset Management
To protect assets, simplify accounting, and enable tax efficiency, many foreign investors prefer to acquire Turkish commercial property through a Special Purpose Vehicle (SPV)—usually structured as a Limited Liability Company (LTD). An SPV is a standalone legal entity established specifically to hold and manage one or more properties. This model also allows easier sale of the property by transferring company shares rather than the asset itself, which may reduce transaction costs and tax liabilities.
Our Istanbul Law Firm incorporates SPVs on behalf of foreign companies and drafts share transfer mechanisms, shareholder agreements, and cross-border cash flow declarations. We also advise clients on using joint ventures or affiliate structures where foreign and Turkish entities invest together. Our Turkish Law Firm provides legal continuity for complex transactions requiring multiple parties, layered ownership, or long-term development planning. Our English speaking Turkish lawyers ensure that all documentation is bilingual and enforceable in Turkish courts.
Double Taxation Treaties and Repatriation of Income
For foreign corporate investors, avoiding double taxation on real estate income is critical. Turkey has bilateral tax treaties with countries including the United States, Germany, the Netherlands, United Kingdom, and most GCC countries. These treaties generally limit or eliminate the withholding tax on dividends, rental income, and capital gains if the investor proves residency in the treaty country. However, to benefit, proper documentation and declarations must be submitted to the Turkish Revenue Administration in advance.
Our Turkish Law Firm prepares treaty-based tax residency declarations and structures income distribution mechanisms that are compliant with both Turkish and international regulations. As a best lawyer firm in Turkey for international investment structuring, we guide corporate investors in repatriating profits through legal and tax-advantaged channels. Our English speaking Turkish lawyers also handle cross-border reporting under FATCA and CRS for clients based in the U.S. or EU.
Also read: currency use compliance in commercial real estate agreements
Real Estate Title Registration for Foreign-Owned Companies
Although Turkish law allows foreign companies to own commercial property, certain legal steps must be completed for the title deed (tapu) transfer to be valid. In some cases, especially for properties near military zones or coastal areas, companies must obtain clearance from the Ministry of National Defense or local security offices. Furthermore, if the acquiring company is directly foreign-owned, the General Directorate of Land Registry (Tapu Kadastro Genel Müdürlüğü) requires documentation proving the company’s legal formation, ownership structure, and authority of its representatives.
Our Turkish Law Firm manages the tapu application process for foreign entities—including notarized translation of corporate documents, tax registration, and power of attorney filings. We also guide clients through the military clearance procedure and defend against delays or rejections due to location-based restrictions. As a best lawyer firm in Turkey for real estate acquisitions, we ensure that foreign companies complete purchases efficiently, legally, and without future risk to ownership validity. Our English speaking Turkish lawyers also represent clients in title verification and correction proceedings if any errors are detected post-transfer.
Frequently Asked Questions (FAQs)
- Can a foreign company directly own commercial property in Turkey? Yes, with proper documentation and registration under the Land Registry system.
- Are there tax advantages for corporate investors? Yes. Corporate depreciation, treaty-based withholding reductions, and structured exits offer benefits.
- Do I need a Turkish partner? No. 100% foreign ownership is allowed in most commercial sectors.
- Is VAT always applicable? Generally yes, but exemptions may apply depending on the transaction structure.
- How long does the purchase process take? 2–4 weeks for due diligence and SPV setup, plus 1–2 weeks for title transfer.
- Can I lease the property after purchase? Yes. Leasing income is permitted and taxable under corporate income tax.
- Should I work with a lawyer? Absolutely. A Turkish Law Firm ensures compliance with real estate, tax, and corporate law.
Invest in Turkish Commercial Real Estate with Legal Confidence
Commercial property investment in Turkey can be a powerful asset for foreign companies—but only when structured and executed properly. Legal, tax, zoning, and ownership risks must be carefully managed at every stage of the acquisition.
At our Istanbul Law Firm, our team of English speaking Turkish lawyers provides comprehensive legal and tax support for commercial real estate investments by foreign corporate clients. As a best lawyer firm in Turkey for cross-border real estate law, we turn complexity into compliance—and real estate into long-term value.