MANILA, Philippines — Key assets in the transportation and telco sectors are on the table for inclusion in the country’s real estate investment trusts (REITs), as regulators move to broaden the scope of income-generating properties.
Under a draft circular issued Nov. 18, the Securities and Exchange Commission (SEC) pushes to widen assets allowed under the REIT Act of 2009.
READ: SEC eyes longer list of REIT assets
Soon, REIT investors may add other assets to their portfolio, which may include toll roads, railways, airports/air navigation facilities, ports, information and communications technology infrastructure, energy infrastructure and data centers, among others.
Other key changes proposed by the SEC are as follows:
- Extend the period for the utilization of reinvestment proceeds to two years, from the previous standard of one year from the date of receipt of the proceeds.
- Relax the compliance with the minimum public ownership requirement for REITs, allowing for a temporary dip in instances when there is an issuance of additional shares to the sponsor/promoter or the latter’s affiliates in exchange for income-generating real estate or real rights over immovable property, subject to certain conditions.
READ: New SEC chief eyes REIT reforms, commodity futures market
REITs are corporations that invest in income-generating real estate assets, like malls and office buildings, and renewable energy power plants.
These are the most common asset portfolios of REITs in the Philippines. They include the Ayala group’s AREIT Inc., Citicore Energy REIT Corp., Filinvest REIT Corp. and the Gokongwei group’s RL Commercial REIT Inc.
The SEC hopes to get public comments on the draft rules by Dec. 3. /dda