Mohammed bin Rashid issues a decree approving the privileges of real estate investment funds in Dubai

​His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, in his capacity as Ruler of the Emirate of Dubai, issued Decree No. 22 of 2022 approving the privileges of real estate investment funds in the Emirate of Dubai, with the aim of enhancing Dubai's position as a global destination for real estate investment, and providing Incentive advantages to encourage real estate investment funds to invest in various real estate projects in the emirate, as well as attract international real estate investment funds to practice their investment activities in the real estate sector in Dubai, in addition to increasing investment in the real estate market, by achieving a long-term capital return for shareholders in real estate investment funds.

 The scope of application of the decree includes all real estate investment funds, licensed and regulated by the competent authority to operate in the emirate, including special development zones, and free zones, including the Dubai International Financial Centre. The scope of application also includes all real estate in the Emirate of Dubai, including properties located in Special development zones and free zones, excluding real estate located within the DIFC.

Register of Real Estate Investment Funds

The decree stipulated the establishment of a register with the Department of Lands and Properties, called the “Real Estate Investment Funds Register”, in which real estate investment funds that meet the conditions for registration and are eligible to benefit from the benefits established under this decree are registered, provided that it is determined by a decision of the Director General of the Land Department. The property is the form of the register, and the data to be included in it.

The decree specified the conditions and procedures for registration in the real estate investment fund register, the most important of which is that the fund be licensed by the competent authority, which the decree defines as the authority competent to license and regulate real estate investment funds in accordance with the legislation in force with it, and it includes the Securities and Commodities Authority, and the Dubai Financial Services Authority in the Dubai Financial Center International, provided that the value of the real estate assets owned by the Real Estate Investment Fund at the time of submitting the application for registration in the register is not less than 180 million dirhams, and that the fund, at the time of submitting the application for registration in the register, was not suspended from trading its shares in the financial markets located in the Emirate of Dubai, while the decree also specified Cases in which the fund is written off from the Real Estate Investment Funds Register.

Real Estate Investment Funds Committee

In the Emirate of Dubai, pursuant to this Decree, a committee called the “Real Estate Investment Funds Committee” will be formed, entrusted with the task of determining the areas and real estate located outside the areas of ownership by non-nationals, in which real estate investment trusts may own absolute ownership that is not restricted by time, or use them or rent them for a period not exceeding 99 years, provided that the committee’s chairman and members are selected, and its work system determined, in accordance with a decision issued by the Chairman of the Executive Council of the Emirate of Dubai.

The Real Estate Investment Fund enjoys, as of the date of its registration in the Real Estate Investment Funds Register, the advantages prescribed under this decree, and these advantages remain throughout the period of its registration in the Register, while the decree clarified the advantages related to ownership, usufruct and renting, whereby real estate investment funds registered in the Register have the right Owning real estate located in non-citizens ownership areas, and real estate investment funds registered in the Register, have the right to own real estate located outside non-citizens’ ownership areas, absolute ownership not restricted by time, use or lease it for a period not exceeding 99 years, in the areas where Determined by the Real Estate Investment Funds Committee.

The decree obligated the Real Estate Investment Funds Committee, when determining the areas or real estate located outside the areas of ownership by non-citizens, to take into account a set of considerations, including: the market value of the property to be owned should not be less than 50 million dirhams, and that the property to be owned has an investment return, in accordance with the criteria it sets The Land Department in this regard, as well as observing the provisions of Decree No. (4) of 2010 regulating the ownership of industrial and commercial lands granted in the Emirate of Dubai, if the property was granted, and any other considerations to be determined by a decision of the Director General of the Land Department in this regard, Also, the Real Estate Investment Fund may not relinquish the ownership of the real estate owned by it in the area determined by the Real Estate Investment Funds Committee, except after obtaining its prior approval to do so, and any assignment otherwise made shall be considered null.

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