ISLAMABAD - The Securities Exchange Commission of Pakistan (SECP) has amended the regulations 2008 to facilitate development of Real Estate Investment Trusts (REITs). This amendment was done by the Securities and Exchange Commission of Pakistan ('SECP), vide S.R.O. 516(I)/2010 that is available on (www.secp.gov.pk) as well. The SECP has claimed that the significant amendments in REIT Regulations, 2008 would provide more conducive environment to the stakeholders. Moreover, this is a step forward to enhance interest of investors for launching of REITs in Pakistan. However, REITs will not only encourage an era of organised real estate development in the formal economy but would also contribute to generate employment and diversify the investor base in Pakistan. The REITs will add a new asset class to the countrys capital market. The SECP has further said that the significant amendments include reduction in the fund size of a REIT from Rs5 billion to Rs2 billion and the reduction in capital requirements for REIT Management Company (RMC) from Rs500 million to Rs200 million. The reduction in fund size and capital requirements will address the issue of capital constraints and would enable even medium size projects to qualify for REITs. In addition, issuance of units against real estate and rental REIT Scheme on multiple sites has been allowed to enhance operational flexibility. Moreover, RMCs have been permitted to draw their fee on quarterly basis instead of annual. The cap on holding of units in a REIT by a single investor has been enhanced for government institutions. Private investors will also benefit from government-owned properties forming part of a REIT as these properties have clear title and usually generate consistent cash flows. A new concept of hybrid REIT has been incorporated to introduce a composite product promising rental income as well as capital gain. This would now permit RMCs to build properties for sale and retain/acquire a few properties for rental purposes. The amendments have been introduced with an objective to open up the real estate market to small investors who do not have enough capital, expertise or time to take advantage of profits and gains in the real estate sector. The REIT being a formal structure allows raising money from the general public, through the issuance of securities listed on Stock Exchanges, to be invested in real estate opportunities.