Real estate funds promoted in Abu Dhabi may face new capital requirements after the financial regulator, the Securities and Commodities Authority (SCA), amended its rules on the regulation of general real estate investment funds.
The amendment includes changes to Article 2 of the administrative resolution, which stipulates that the fund’s real estate assets shall not be less than 75% of its total assets.
Article 2 also states that revenues from real estate, interest, dividends and capital gains shall not be less than 90% of total revenues and net assets.
Article 1, meanwhile, stipulates that the fund’s real estate assets should be approved by the local authority of where the property is located in order to prove ownership or the right to occupation.
The SCA also clarified new regulations for “in-kind shares” in investment funds and defined the obligations of the fund’s administration, founders and director, in addition to the cost of assessments and transferring ownership and the penalties in case of violations.
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