Philippine Reits structure prompts concern

Author: | Published: 1 Nov 2009
The Reits structure limits oversight

In a move that the Philippines hopes will encourage real estate investment, the country is set to enact a new law allowing Reits to be set up. But their success could be scuppered by an unusual structure that limits oversight.

Rather than use the more common trust structure, Philippine Reits will use a corporate structure. This will mean less regulation, which could discourage potential investors.

“In a trust structure, the trustee holds the assets and is the guardian of due process,” said Milton Cheng at Baker & McKenzie. “One of the trustee’s jobs...