SEC issues new ‘robust’ REIT rules
The Securities and Exchange Commission (SEC) moves to strengthen the real estate investment trust (REIT) market, with changes in the rules that open investments beyond traditional real estate.
The corporate regulator issued Memorandum Circular No. 1, Series of 2026, introducing amendments to the regulatory framework for REITs.
“We wanted to start the year strong, which is why we spared no effort to make this REIT MC our first issuance of 2026,” SEC chair Francis Lim said.
“By establishing a more robust framework for the REIT market, we are broadening opportunities for participation in real estate investment, helping more Filipinos benefit from long-term wealth creation,” he added.
Under the MC, the SEC allows a REIT to directly or indirectly own income-generating real estate.
The directive likewise clarified that income-generating real estate includes those properties with steady cash flow, such as rentals, toll fees, user fees, ticket sales, parking fees and storage fees.
Participants may also invest in other assets, including those in the transportation, telecommunications and power sectors.
These include toll roads, railways, airports and air navigation facilities, ports, information and communications technology infrastructure, energy infrastructure assets and data centers.
Parking lots, buildings, malls, warehouses or storage facilities, immovable fixtures, machinery, facilities and structures and real rights over properties, including but not limited to usufruct, easements and registered leases, are also covered.
Reinvestment period
The SEC is also extending the reinvestment period to two years from the previous one year.
The regulator hopes that with this, enterprises would have “greater flexibility in planning their growth and financing strategies.”
“Reinvestment may take the form of investments in equity, the extension of loans or purchase of debt instruments or the repayment of loans or debt instruments in relation to any real estate or infrastructure projects in the country,” it added.
Under the revised rules, the SEC also said that public shareholders are ordinary investors who hold less than 10 percent of the shares in the REIT and do not have “significant influence” over how it runs.
