Updates to REIT rules, rate cuts may attract listings, says ICCP

THE Securities and Exchange Commission’s (SEC) proposed updates to real estate investment trust (REIT) rules, alongside possible interest rate cuts by the central bank, could encourage more REIT listings, the Investment & Capital Corporation of the Philippines (ICCP) said.

- Beatriz Marie D. Cruz

“If interest rates come down, that would be good for REITs because issuers would be more encouraged to come to market as they would not have to offer very high dividend yields,” ICCP President and Chief Operating Officer Jesus Mariano P. Ocampo said in a statement on Tuesday. “REITs are a dividend story at the end of the day.”

Under the updated REIT rules, the SEC has expanded the definition of income-generating assets to include sectors such as power, infrastructure and telecommunications.

The rules, which took effect this month, also extend sponsors’ reinvestment deadlines and strengthen disclosure and governance requirements.