| Moving to international best practice
The transition to Real Estate Investment Trusts (REIT) has aligned the South African listed property sector
(both property loan stock companies and property unit trusts) to global standards and enhanced the
appeal of the sector as an investment opportunity.
The REIT structure is an international standard for property investment, where a tax dispensation ensures
flow through of net property income after expenses and interest. Over 25 countries use a similar model,
including the US, UK, Australia, Belgium, France, Hong Kong, Japan and Singapore. In some jurisdictions,
such as South Africa, REITs are exempt from capital gains taxation.
The transition to international standards brings enhanced governance, transparency and accountability to
the real estate sector. Like their global peers, South African REITs provide investors with regular statutory
reporting and are subject to strict oversight. For more details, see http://www.sareit.com. |
