Reit to stimulate Bahrain economy

Manama

Real Estate Investment Trust (REIT) will provide new impetus to the development of the Kingdom’s economy, according to Bahrain Bourse CEO Shaikh Khalifa bin Ebrahim Al Khalifa. Introduction of more REITs will help the development of a better investment ecosystem and the entire economy will benefit from the same, he added.The CEO was briefing the media regarding the specifics of REITs that will be listed in Bahrain Bourse. REITs licensed by the Central Bank of Bahrain (CBB) are mandated by law to list on the stock exchange within a period of six months.The legal structure of REITs will be in the form of trusts licensed by CBB, which will have a minimum size of US$20 million of asset value. The REITs should have minimum investment in two income-producing properties and it should comprise 80 per cent of its net asset value (NAV). Development properties should be limited to less than 20pc of the asset value of the trusts.Foreign investments in REITs and foreign properties are allowed under the programme. Also, foreign REITs are permitted to be listed in Bahrain Bourse.The listed REITs will have to disclose their NAVs on a monthly basis and within six trading days after the period ends. Audited annual financial statements are to be filed within a period of three months of the end of the period.The CEO highlighted the state-of-the art legal and regulatory environment in Bahrain, resilient market infrastructure for securities trading, clearing and settlement, high regulatory and investor protection standards, and solid financial sector supervision as the reasons for domestic and international REITs to list in Bahrain.He added that there is very high demand to list REITs in Bahrain Bourse and hoped for great developments in this sector.