The Government has touted
its new law- No. 289 of December 26, 2006- promoting the creation of local REITS as an important tool to foster local capital
markets and increase economic activity in Puerto Rico.
REITs are a corporations
or business trusts– generally trading in stock exchanges-that pools investors’
capital in all types of real estate investments such as office buildings,
hotels, industrial facilities and apartments. Since REITS trade as shares, investors can participate in real
estate investments without tying up enormous amounts of cash.
The law eliminates
regulatory barriers for REITS and lowers
tax rates for dividends. Seventy Five
percent or more of their assets and gross income must be derived from local
property.
