Karachi: The federal government has introduced new Real Estate Investment Trust (REIT) regulations allowing the establishment of REIT companies on the Pakistan Stock Exchange (PSX), news sources reported on December 13.
After the new regulations, a number of REIT projects worth PKR 450 billion are set to be listed at the Pakistan Stock Exchange (PSX) over the next few years, including seven newly created development REITs. By introducing the REIT Regulations 2022, the SECP has allowed REIT companies to raise financing for agriculture projects, mobile tower projects, and renewable energy (solar and wind power) projects.
The new regulations have enabled investors to become shareholders in real-estate projects while also encouraging them to develop saving habits. It is expected that the new regulations will help document the Pakistani economy by bringing the informal real-estate sector into the formal sector.
The SECP has also allowed the establishment of REIT general-purpose investment funds (akin to mutual funds) to attract capital from investors that can be further invested in any of the REIT projects.
Over the past year, the SECP has issued some 16 licenses for the establishment of REIT management companies. The June 2021 regulations (amendments) have allowed the corporate sector to establish REIT companies and projects.
Nauman Ahmad is an imaginative Pisces whose love for literature and nature is unparalleled. When he's not reading or hiking, he's sleeping and eating, which gives him plenty of energy for his next adventure.
