CBRE says property investment trusts unlikely to form this year
COMMERCIAL property consultant CBRE has said it is unlikely that a Real Estate Investment Trust (REIT) will be set up in Ireland this year.
The Government announced the establishment of REITs in Ireland in the Budget, with legislation expected in the coming months.
At a REITs conference in central Dublin, Marie Hunt, of CBRE, said REITs were an extra entry route for anyone looking to get into the property sector.
But she told the Irish Independent: "I'd question whether we will actually have a REIT up and running in 2013.
"I think that this year will be all about putting the legislation in place and getting our heads around the model and the structure and how it will work, but I don't know if anybody will get one up this year."
REITs are exempt from tax at corporate level, usually offer high yields and provide an easy exit strategy from investment commitments.
Ms Hunt said 2013 was expected to see an increase in the number of pubs going into receivership.
She also said there was significant demand for exposure to Irish real estate at this point in the property and economic cycle.
Although she said two hotels were expected to open in Dublin this year, the commercial rents were expected to remain flat for 2013.
Figures from the property, finance and related sectors in Ireland, the US, UK and Asia attended the half-day event in Dublin's Convention Centre, which was also addressed by Department of Finance secretary general John Moran and the head of asset management at NAMA, John Mulcahy.
Mr Moran said Dublin could establish itself as a property services centre, similar to its position as a global leader in aviation finance and funds administration. Ireland will seek to push the issue of creating tax-efficient cross-border REIT structures that avoid double taxation, he said.
The Government will first focus on the introduction of REITs covering domestic real-estate, as the National Asset Management Agency and banks seek to dispose of assets.
"We see this as producing a way for the Irish obsession with property, historically so individualised, to be more professionalised," Mr Moran said.