The Belgian legal framework for regulated real estate companies and specialized real estate investment funds has evolved over the past few years. A law on diverse financial provisions introduced the latest set of measures that are effective 1 June 2019.
New opportunities for joint ventures and certain partnerships
The legislative reforms identify a new type of entity that can elect to be treated as a specialized real estate investment fund. Investment vehicles in which investors, acting collectively, have daily decision-making authority or control may elect to be treated as a specialized real estate investment fund. This innovation aims to make investments accessible to certain types of partnership structures.
Reduced share capital requirements
The minimum capital for specialized real estate investment funds has been reduced from €1.2 million to amounts to be determined under the Belgian Companies and Associations Code. The reduced minimum share capital, however, does not affect the requirement to hold a total real estate portfolio with a minimum value of €10 million at the end of the second financial year following the entity’s registration.
Certain clarifications concern the competence of the supervisory authorities. Specialized real estate investment funds are registered with the Belgian Federal Public Service for Finance (FPS Finance). Once the entity is registered, the FPS Finance will supervise compliance, and can require entities to report on their compliance with the regulatory provisions.
Modified rules for capital increase
Regulated real estate companies will be able to raise capital (cash) without applying a non-reducible priority allocation right for existing shareholders, provided that two conditions are satisfied:
Read a November 2019 report prepared by the KPMG member firm in Belgium
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