Propco

Dictionary Says

Definition of 'Propco'

An abbreviation for property company. Propcos are most often used to describe a subsidiary company that exists to hold or own a parent or operating company's income-generating real estate. The property company owns all of the real estate and related debt, providing the parent or operating company with advantages related to financing and credit rating issues.
Investopedia Says

Investopedia explains 'Propco'

This type of arrangement allows the operating company to rent or lease property from the property company. Sometimes the operating company will spin the property company off as a real estate investment trust (REIT) for tax advantages.

Related Definitions

  • Subsidiary

    A company whose voting stock is more than 50% controlled by another company, usually referred to as the parent company.
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  • Real Estate Investment Trust - REIT

    A security that sells like a stock on the major exchanges and invests in real estate directly, either through properties or mortgages. REITs receive special tax considerations and ...
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  • Real Estate

    Land plus anything permanently fixed to it, including buildings, sheds and other items attached to the structure. Although, media often refers to the "real estate market" from the ...
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    • Investment Real Estate

      Real estate that generates income or is otherwise intended for investment purposes rather than as a primary residence. It is common for investors to own multiple pieces of real estate, ...
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    • Lease

      An agreement in which one party gains a long-term rental agreement, and the other party receives a form of secured long-term debt.
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