Final answer:
A limited liability corporation (LLC) owns real property as a distinct legal entity, similar to a corporation, which provides limited liability protection to its members. The LLC itself bears the liability for the property, offering members protection for their personal assets against the company's debts and liabilities.
Step-by-step explanation:
A limited liability corporation (LLC) is a business structure allowed by state statute and is not classified as a sole proprietorship, partnership, corporation, or trust in the traditional sense. However, for the purposes of property ownership, an LLC can own property in a manner similar to a corporation because it is a distinct legal entity. Unlike a sole proprietorship or a partnership, the LLC provides its owners, who are known as members, with limited liability. This means the members are typically not personally responsible for the company's debts and liabilities, including those associated with real property owned by the LLC.
When an LLC owns real estate, the property is an asset of the LLC and not the individual members. This setup provides protection for the members' personal assets. The LLC bears the liability for any mortgages or other claims related to the property, a significant advantage over structures like sole proprietorships or partnerships where individual owners could be personally liable.