ITALY: Real Estate News
“Changes to Italy’s REIT rules will significantly enhance the appeal of the country’s listed property sector to international investors, encouraging more investment in Italian Real Estate and allowing local companies that adopt the status to compete on a fair basis with REIT’s regimes in other countries”, the European Public Real Estate Association (EPRA) said.
Italian government presented the changes on Italian REITs (Società di Investimento Immobiliare Quotate – SIIQ), already in the Destination italy and in the DEF 2014 (Italian Economic and Financial Document), in late August and included them in the “Unblock Italy” package, which contains measures to improve the competitiveness of the economy and to ease the disposal of the state property in surplus, together with real estate Funds and Companies. The law-decree has been published in the Gazzetta Ufficiale n. 212 – september the 12 th 2014 , and it is effective (DL 133/2014). It will be ratified by the Italian Parliament in the next 60 days. The Decree born from the stable discussion with Institutions and, in particular, with the experts of the Task force named “Finance for growth – Financial Markets and Infrastructure”, made by the Ministry of Economy and Finance, the Ministry of Economic Development and the Ministry of Infrastructures and Transport (main representatives: Pagani, Firpo, Aiello e Aresu) and other Governative’s office.
Assoimmobiliare, the Association of SIIQ, Funds and Real Estate Companies, presided by Aldo Mazzocco and managed by Paolo Crisafi, said: “This is a positive step ahead for the Italian Real Estate market, where the REIT regime has not seen a great development after its introduction in 2007. These new rules will create a level playing field in fiscal terms with Italian Real Estate Funds and attract significant foreign investment by enabling SIIQs to compete on equal terms with their international peers, notably in France and the U.K. Assoimmobiliare will continue to talk with the appropriate Institutions in Real Estate services and finance sector, to achieve a true industrial policy encompassing all aspects of real estate”.
The key changes to the new SIIQ rules announced by the government are:
1. Lifting the ceiling for a majority (single shareholder maximum participation) shareholding in a SIIQ to 60% from 51%.
2. Lowering the dividend distribution requirement from 85% to 70% of recurring rental income
3. Income originating from the net capital gains realized on properties to be leased and deriving from the sale of equity investment il Listed and Unlisted Real Estate Investment Companies or of shares of real estate funds per Paragraph 131 included in the tax exemption under Paragraph 131 are subject to the 50% distribution obligation in the two years following the year of realization.
Philip Charls, EPRA’s Chief Executive, said: “This is an encouraging step for the Italian real estate market. It highlights why EPRA works continuously with national associations, and in Italy with Assoimmobiliare, to raise awareness of the contribution that REITs can make in unlocking economic growth, job creation and sustainable regeneration, while providing investors with a secure, stable income. Italy’s government has clearly had an eye on the robust health of the French REIT sector and how the changes to the regime in Spain and the launch of the structure in Ireland have spawned a series of successful IPOs.”
Aldo Mazzocco, President of Assoimmobiliare and Chief Executive of Beni Stabili, said: “The political will and the technical effort made by the Council Presidency’s offices and by the experts of the Task force, named “Finance for growth – Financial Markets and Infrastructure”, made by the Ministry of Economy and Finance, the Ministry of Economic Development and the Ministry of Infrastructures (main representatives: Pagani, Firpo, Aiello e Aresu), to simplify and to make the Italian real estate market more attractive for long term investments, are clear and we are really happy for that. These are not incentives but very important decisions to align Italy to the best European real estate markets, especially the French and the English ones. Now we need entrepreneurials initiatives and operating ideas to get the best from the great flexibility issuing by the new regulatory framework. Now it’s up to the private companies: the Government has done what he was asked to. More measures for the real estate services’ and finance’s sector have been presented and further will be set. Debates with governative’s experts are going on”. From this point of view a great importance will have the relationship whit Mr. Roberto Reggi, Director of Italian State Property Agency, and with Mr Stefano Scalera, Counsel of the Ministry of Economy and Finance to attract foreign investment”.
Possible release by Mr Stefano Scalera, Counsel of the Italian Ministry of Economy and Finance to attract foreign investment
Possible release by MrFabrizio Pagani, Head of Technical Secretariat Italian Ministry of Economy and Finance
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