Two real estate companies jointly buy the land and buildings that constitute a shopping centre. The companies separately financed their share of the shopping centre acquisition.
They set up a separate legal company for the purpose of operating the shopping centre business and called it Shoppers Heaven. They transferred their ownership in the shopping centre to the company. The activities of the Shoppers Heaven business include renting the retail units, managing the parking lot, maintaining the centre and equipment such as elevators, and building the reputations and customer numbers for the centre as a whole. Strategic decisions relating to the operations require the consent of both companies.
The terms of incorporation of Shoppers Heaven are such that each company receives a share of the income from the shopping centre. The companies have the right to sell or pledge their interest in the corporation.
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How would the real estate companies report this arrangement?