The legislative decree which sets the framework for Real Estate Investment Trusts to start investing in Portugal comes into force on the 1st of February. This legislation, which regulates such investment societies and aims at revitalising the real estate sector in the country, was published on Diário da República, this Monday.
REIT’s are required to have a minimum share capital of five million euros in order to be eligible to invest in the Portuguese real estate market, together with a couple other requirements which can be found in the diploma. For instance, these societies’ indebtedness level is limited, as it can’t ever correspond to more than 60% of the total of its assets, according to the regulation.
REIT’s assets must be constituted by specific property rights which envision renting and other ways of long term economic use, and its main goal should be to “hold shares in real estate investment funds (its purpose is the collective investment of the investors’ savings. The investments are carried out in line with the participants’ exclusive interest and allow the risk spreading)”, the legislation shows. REIT’s may also invest in properties which will be used for other economic purposes, like malls and offices.
This decree-law will come into force on the 1st of February, a month after its publication.