The Philippines is expected to launch its first real estate investment trust (REIT) in 2020, more than ten years after lawmakers passed legislation for the securities, according to a local English language daily.
The Philippines Daily Inquirer quotes Ephyro Luis Amatong, commissioner of the Securities and Exchange Commission (SEC), as saying that the regulator is currently finalising revisions to REIT regulations after receiving feedback from the central bank, and amendments to listing rules from the Philippine Stock Exchange.
“We are on track to launch in the new year,” Mr. Amatong told the newspaper in an interview published on January 2. He did not provide a specific timeline.
Spokespersons for the SEC did not immediately respond to questions from Asia Asset Management (AAM).
Philippine lawmakers passed the REIT Act in July 2009 but real estate companies and property owners have been reluctant to list their properties, primarily because the threshold for public shareholding is too high, according to a fund manager at a foreign asset management company in Malaysia.
The legislation requires at least 51% of REITs to be held by public shareholders in the first year of listing, and 67% by the third year.
The minimum threshold will be lowered to a flat 33% under the revised rules. In addition, REITs will be required to seek approval from the SEC if they want to invest overseas, to allay concerns about money raised from a domestic offering being invested abroad.
“The market is generally welcoming the much-needed changes. It shows that the government is committed to grow its capital market for the long term,” the Kuala Lumpur-based fund manager tells AAM, speaking on condition of anonymity.
