Please consider the following scenario for a German company:
- Company A wishes to have an office building built for its needs on
land that it owns in Germany
- Company A signs a ground lease with Investor B and a lease with
Investor B for construction of the building, both with 25 year terms
- Company A assumes ownership of the building after expiration of both
lease contracts.
The questions to be answered by persons with knowledge of German tax
law are as follows:
- Would Company A normally be allowed to deduct all of its office rent
payments for tax purposes assuming the lease were concluded at market
rates?
- Would Investor B be entitled to depreciate the building for tax
purposes under normal schedules?
- Would Company A be required to exercise an option to purchase the
building after the end of the 25 year lease term(s)? If so, would
Company A be required to pay a market price to exercise the purchase
option?

company A and investor B - are those german legal entities?