Business Reporter –
Muscat, Jan 16 –
The Capital Market Authority (CMA) has issued initial approval for the establishment of the Sultanate’s first Real Estate Investment Fund (REIT). Named ‘Aman REITs’, the new investment instrument stems from proposals mooted by the National Programme for Enhancing Economic Development (Tanfeedh) during its Innovative Finance and Financing Lab held in 2017.
The IPO of the fund is expected during the first quarter of this year, the Authority said in a statement.
REITs are considered a qualitative addition to the GDP and would enhance investment opportunities in the real estate sector as new avenue of investment through encouraging small and institutional investors to enter the Omani real estate market, moving the financing wheel and encouraging real estate investment which would have considerable impact on the foreign investments as such funds provide incentives for foreign investments and attract investments from abroad beside diversifying investment options and increases market depth.
Mohammed Said al Abri, Vice- President, Capital Market Sector at the CMA, said: “We praise the first initiative to establish real estate investment fund which we expect to have noticeable impact in pushing the economic development process in Oman.”
Aman REITs is currently undertaking the initial groundwork in preparation for an IPO scheduled before the end of the first quarter of this year. The CMA’s initial approval has been issued for a RO 20 million fund, 50 per cent of which will be offered to the public.
Al Abri added: “We are viewing such funds as a regulated platform for foreign investors to activate the real estate market by holding investment units. REITs, he emphasised, would address the concerns of local investors over foreign investors entering and controlling properties including residential properties, particularly with regard to their social and security implications.
Furthermore, the funds will provide numerous options for investors, including companies and individuals to invest in real estate through the ownership of investment units without having direct control over n the assets. Prospects for partnerships with citizens eager to avail themselves of promising real estate investment opportunities abound as well, he said.
The listing of the fund on the stock exchange will contribute to the creation of new securities instrument that will allow for the original developer to exit the project through the stock market.
Abdulsamad al Maskari, Chief Executive Officer of Tharaa Global Business, the promoters of Aman REIT, said: “This type of funds attained global acclaim for the positive indicators they achieve in a number of economies, besides contributing to
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Business Reporter –