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Exhibit 8
January 16, 2001
Commercial Net Lease Realty, Inc.
450 South Orange Avenue, Suite 900
Orlando, FL 32801
Ladies and Gentlemen:
On January 16, 2001, Commercial Net Lease Realty, Inc. ("NNN") filed a
registration statement on Form S-3 (the "Registration Statement"), with the
Securities and Exchange Commission. In connection with the filing of the
Registration Statement , you have asked us to render an opinion with respect to
the qualification of NNN as a real estate investment trust ("REIT") under
sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the
"Code").
We have served as special counsel for NNN in connection with the filing
of the Registration Statement and from time to time in the past have represented
NNN on specific matters as requested by NNN. Specifically for the purpose of
this opinion, we have examined and relied upon the following: copies of NNN's
Articles of Incorporation and any amendments thereto; the Registration
Statement; copies of executed leases covering real property owned by NNN; and
NNN's Form S-11 Registration Statement as filed with the Securities and Exchange
Commission on August 15, 1984.
We have not served as general counsel to NNN and have not been involved
in decisions regarding the day-to-day operation of NNN and its properties. We
have, however, discussed the mode of operation of NNN with its officers with a
view to learning information relevant to the opinions expressed herein and have
received and relied upon a certificate from NNN with respect to certain matters.
We have discussed with management of NNN arrangements relating to the
management of its properties, the relationships of NNN with tenants of such
properties, and certain terms of leases of such properties to tenants, with a
view to assuring that (i) at the close of each quarter of the taxable years
covered by this opinion, it met the asset composition requirements set forth in
section 856(c)(4), (ii) with respect to years covered by this opinion, it
satisfied the 95% and 75% gross income tests set forth in sections 856(c)(2) and
(3), respectively, and (iii) with respect to tax years prior to 1998, it
satisfied the 30% gross income test. We have further reviewed with management of
NNN the requirements that the beneficial ownership of a REIT be held by 100 or
more persons for at least 335/365ths of each taxable year and that a REIT must
satisfy the diversity of ownership requirements of section 856(h) as such
requirements existed in the years covered by this
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Commercial Net Lease Realty, Inc.
January 16, 2001
Page 2
opinion, and we have been advised by management that at all times during the
years covered by this opinion (and specifically on each record date for the
payment of dividends during 1984 through the date hereof) NNN has had more than
1,000 shareholders of record, that NNN maintains the records required by section
1.857-8 of the Treasury Regulations, that no later than January 30 of each year
it sent the demand required by section 1.857-8(d) of the Treasury Regulations to
each shareholder of record owning one percent or more of the outstanding shares
of NNN on the appropriate date required by said regulation, and that the actual
ownership of NNN shares was such that, to the best knowledge of its management
(based upon responses to the aforesaid demands, any filing of a Schedule 13D
under the Securities Exchange Act of 1934, as amended, or any other sources of
information), NNN satisfied the applicable requirements of section 856(h).
Further, we have examined various property leases and lease supplements relating
to the properties that NNN owns, and although leases relating to certain
properties that NNN owns have not been made available to us, NNN has represented
with respect to such leases that they do conform in all material respects to a
form of lease agreement provided to us. On the basis of discussions with
management of NNN, we are not aware that NNN's election to be a REIT has been
terminated or challenged by the Internal Revenue Service or any other party, or
that NNN has revoked its election to be a REIT for any such prior year so as to
make NNN ineligible to qualify as a REIT for the years covered by this opinion.
In rendering the opinions set forth herein, we are assuming that copies
of documents examined by us are true copies of originals thereof and that the
information concerning NNN set forth in NNN's federal income tax returns, and in
the Registration Statement, as well as the information provided to us by NNN's
management are true and correct. We have no reason to believe that such
assumptions are not warranted.
Based upon the foregoing, we are of the opinion that: (a) NNN was a
"real estate investment trust" as defined by section 856(a) for its taxable
years ended December 31, 1984 through December 31, 2000, and its current and
proposed method of operation will enable it to meet the requirements for
qualification and taxation as a REIT for its taxable year ending December 31,
2001 and for all future taxable years, and (b) NNN's wholly owned subsidiaries,
Net Lease Realty I, Inc., Net Lease Realty II, Inc., Net Lease Realty III, Inc.,
Net Lease Realty IV, Inc., Net Lease Funding, Inc., CNLR GP Corp., and CNLR LP
Corp. were each "qualified REIT subsidiaries" as defined by section 856(i) for
each taxable year of their existence and the proposed ownership of these
entities, will enable them to meet the requirements for treatment as "qualified
REIT subsidiaries" for NNN's taxable year ending December 31, 2001 and for all
future taxable years. With respect to the 2001 year and all future years,
however, we note that NNN's status as a real estate investment trust at any time
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Commercial Net Lease Realty, Inc.
January 16, 2001
Page 3
is dependent among other things upon its meeting the requirements of section 856
throughout the year and for the year as a whole.
This opinion is based upon the existing provisions of the Code (or
predecessor provisions, as applicable), rules and regulations (including
proposed regulations) promulgated thereunder, and reported administrative and
judicial interpretations thereof, all of which are subject to change, possibly
with retroactive effect. This opinion is limited to the specific matters covered
hereby and should not be interpreted to imply that the undersigned has offered
its opinion on any other matter.
We hereby confirm that the statements set forth in the Registration
Statement under the heading " Federal Income Tax Considerations," to the extent
that they constitute matters of law or legal conclusions with respect thereto,
are correct in all material respects.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. We also consent to the reference to Shaw Pittman under
the captions " Federal Income Tax Considerations" and "Legal Matters" in the
Registration Statement. In giving such consent, we do not consider that we are
"experts," within the meaning of the term used in the Act or the rules and
regulations of the Securities and Exchange Commission promulgated thereunder,
with respect to any part of the Registration Statement, including this opinion
as an exhibit or otherwise.
Very truly yours,
SHAW PITTMAN
By: /S/ Shaw Pittman
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Charles B. Temkin, P.C.
