Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister, and Ruler of Dubai, has signed a decree creating incentives for real estate investment funds in Dubai.
According to the Dubai Media Office, Decree No (22) of 2022 covers all real estate investment funds licensed and regulated by government authorities as well as private development zones and free zones, including the Dubai International Financial Centre (DIFC).
It also covers all real estate in Dubai, including properties located in private development zones and free zones, excluding DIFC.
Register for property funds to be set up
A ‘Register of Property Investment Funds’ is to be established at the Dubai Land Department (DLD) in line with the new decree’s provisions. Terms, conditions, and procedures for listing in the register are outlined.
Funds that want to be listed in the register should be licensed by competent government authorities, including the Securities and Commodities Authority and the Dubai Financial Services Authority, DIFC’s independent regulator of financial services.
The value of real estate assets owned by the fund at the time of application for listing in the register should be Dhs180m or above. Funds should not be suspended from trading in Dubai’s financial markets at the time of application.
Property investment funds listed in the register are entitled to receive the incentives specified by the decree.
Committee for property funds to be created
A ‘Committee for Property Investment Funds’ will also be set up to identify areas and properties that funds are allowed to invest in either through full ownership or lease for a period not exceeding 99 years.
The value of properties that funds invest in should be Dhs50m or above. The properties should be listed as commercial properties and comply with Decree No (4) of 2010.
Funds are allowed to relinquish ownership of properties only after approval from the committee.
Authority to amend and add related incentives
The new decree authorises the chairman of the Executive Council of Dubai to amend the incentives specified by the decree or add new ones. The chairman of the Dubai International Financial Centre has also been authorised to amend incentives for property investment funds operating within DIFC’s jurisdiction.
Dubai Land Department will also appoint a valuation specialist accredited by the Dubai Real Estate Regulatory Agency to determine the value of properties owned by property investment funds as per the decree.
The director general of the DLD is authorised to issue other resolutions necessary to implement the provisions of the new decree.
Any legislation contradicting the new decree will be annulled.
