Globally, Real Estate Investment Trusts have become a lucrative investment opportunity for individual and institutional investors, providing greater access to commercial real estate projects.
Real Estate Investment Trusts (REITs), first introduced in the United States in 1960 under the guidance of President Eisenhower, created a mechanism for individual investors to generate income through investing in large commercial real estate. Commonly referred to as REITs, this unique mechanism provided the opportunity for a greater number of individuals to invest in commercial assets which were previously open only to large financial institutions and significantly wealthy individuals.
The benefits of REITs are not limited to individual investors alone. The subsequent ripple effects of developing this sector can benefit the government and the economy as a whole.
To foster a conducive climate for REITs in Sri Lanka, there are some key areas that must tackled, particularly the establishment of a suitable legal and regulatory framework and a suitable tax regime.