Philip­pine REIT to at­tract more Qatari FDI: Of­fi­cial

Gulf Times - Gulf Times Business - - FRONT PAGE - By Peter Ala­gos Busi­ness Re­porter

The re­cently re­leased im­ple­ment­ing rules and reg­u­la­tions (IRR) of the Philip­pines’ Real Es­tate In­vest­ment Trust (REIT) law would help at­tract Qatari for­eign di­rect in­vest­ment (FDI) to the South­east Asian na­tion.

“REITs are known to be prop­erty-based stock prod­ucts with le­gal mech­a­nisms that al­low in­vestors to earn from var­i­ous in­come-gen­er­at­ing real es­tates as as­sets,” the As­so­ci­a­tion of Filipino Re­al­tors & En­tre­pre­neur Ex­ec­u­tives in Qatar (Afreeq) said in a state­ment.

“This fi­nan­cial ve­hi­cle has been in prac­tice in many coun­tries and has man­aged to gain pop­u­lar­ity in re­cent years,” the state­ment said, adding that the Philip­pines’ REIT law was en­acted in 2009 through Repub­lic Act 9856.

The IRR was re­leased last month by the Philip­pine’s Se­cu­ri­ties and Ex­change Com­mis­sion (SEC) and the Bureau of In­ter­nal Rev­enue (BIR) with the ap­proval of the coun­try’s Depart­ment of Fi­nance (DoF) in a sign­ing cer­e­mony at­tended by DoF Sec­re­tary Carlos G Dominguez and Con­gress­woman Sharon S Garin, chair­per­son of the House Com­mit­tee on Eco­nomic Af­fairs.

With the new IRR in place, Afreeq stated that the prospect of in­vest­ing in Philip­pine REITs “has be­come more at­trac­tive as in­vestors would now en­joy the con­ve­nience of frac­tional in­vest­ing across var­i­ous in­come gen­er­at­ing real es­tate prop­er­ties through a di­ver­si­fied port­fo­lio un­der a glob­ally-com­pet­i­tive le­gal frame­work sim­i­lar to suc­cess­ful REITs in Asia, par­tic­u­larly those in Malaysia, Korea, Hong Kong and Ja­pan, not to men­tion the ben­e­fits of the re­cent amend­ments in terms of tax­a­tion and other perks.”

Afreeq chair­man Joseph Ti­mothy Rivera said, “Philip­pine REITs would now open doors to more for­eign di­rect in­vest­ments from Qatari busi­ness­men and other suc­cess­ful Qatar-based hold­ing com­pa­nies en­gaged in the global prop­erty in­dus­try.”

Rivera said Qataris will now have the op­por­tu­nity to a range of var­i­ous Philip­pine as­set-backed se­cu­ri­ties, “in ad­di­tion to tra­di­tional di­rect real es­tate in­vest­ment op­tions within gen­er­ous for­eign own­er­ship lim­i­ta­tions im­posed un­der the Philip­pine law.”

“With the REIT frame­work, the in­come po­ten­tial for each in­vest­ment as spread across sev­eral units and would cer­tainly re­duce the risk of in­come losses due to un­fore­seen mar­ket per­for­mances of in­di­vid­ual real es­tate prop­er­ties,” Rivera pointed out.

Sim­i­larly, Rivera stressed that Philip­pine

REITs would also ben­e­fit Over­seas Filipino Work­ers (OFWs) across the globe and Filipino expats liv­ing in Qatar.

“They may now in­vest in the Philip­pine prop­erty mar­ket with the same di­ver­si­fied port­fo­lio across sev­eral as­sets made avail­able to big ticket in­vestors with­out the need of pur­chas­ing one whole in­di­vid­ual prop­erty,” he said.

Rivera also wel­comed the re­cent an­nounce­ment of Philip­pine de­vel­oper, Ayala Land, which re­cently filed its ap­pli­ca­tion for a REIT of­fer­ing to the SEC, “with other prime devel­op­ers in the Philip­pines ex­pected to fol­low suit in the com­ing months.”

“With most Philip­pine prop­erty devel­op­ers hav­ing rep­re­sen­ta­tive of­fices in Doha, we are op­ti­mistic on the prospects that REIT in­vest­ment op­por­tu­ni­ties would soon be avail­able to in­vestors both OFWs and other na­tion­al­i­ties in Qatar,” said Rivera, who is also an in­vest­ment pro­mo­tions part­ner of the Philip­pine Eco­nomic Zone Au­thor­ity (Peza) in the Mid­dle East.

“The prospects of hav­ing REIT com­pa­nies in­vest­ing as an eco­zone de­vel­oper or eco­zone fa­cil­i­ties com­pany en­ti­tled to fis­cal in­cen­tives for el­i­gi­ble projects is now be­ing stud­ied by the Pol­icy & Plan­ning Depart­ment of Peza. Re­cent pro­pos­als for crowd­fund­ing of eco­nomic zones would at­tract more in­vest­ments through the REIT frame­work,” he added.

“Philip­pine REITs would now open doors to more for­eign di­rect in­vest­ments from Qatari busi­ness­men and other suc­cess­ful Qatar-based hold­ing com­pa­nies en­gaged in the global prop­erty in­dus­try,” says Rivera.

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