His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai, issued Decree No. (22) of 2022, which established incentives for property investment funds in Dubai.
The Decree applies to all government-licensed and regulated real estate investment funds, as well as private development zones and free zones, including the Dubai International Financial Centre (DIFC).
It also applies to all real estate in Dubai, including assets in private development zones and free zones, with the exception of the DIFC.
The Dubai Land Department will establish a ‘Register of Property Investment Funds’ under the new Decree. The Decree specifies the rules, circumstances, and processes for inclusion in the Register. Funds wanting to be listed on the register must be regulated by government agencies such as the Securities and Commodities Authority and the Dubai Financial Services Authority, the DIFC’s independent financial services regulator.
The fund’s real estate holdings should be worth at least Dh180 million at the time of application for inclusion in the Register. At the time of application, funds should not be barred from trading in Dubai’s financial markets.
The Decree also authorizes the formation of a ‘Committee for Property Investment Funds,’ the objective of which is to select locations and properties in which funds may invest through full ownership or lease for a period not exceeding 99 years.
The value of properties in which funds invest should be at least Dh50 million. The properties must be classified as commercial in accordance with Decree No. (4) of 2010. Only with the Committee’s consent may funds surrender ownership of assets.
Property investment funds included in the Register are eligible for the Decree’s benefits.
Decree No. (22) of 2022 empowers the Chairman of Dubai’s Executive Council to change or add to the incentives mentioned in the Decree. The Chairman of the Dubai International Financial Centre is also authorized to change incentives for property investment funds operating under the authority of the DIFC.
The Decree also instructs the Dubai Land Department to select a valuation consultant recognized by the Dubai Real Estate Regulatory Agency (RERA) to establish the value of property investment funds’ properties.
Aside from the resolutions issued by the Chairman of the Dubai Executive Council in line with Decree No. (22) of 2022, the Director General of the Dubai Land Department is authorized to make any further resolutions required to execute the new Decree’s requirements.
Any legislation that is in conflict with the new Decree shall be repealed. The Decree takes effect on the date it is published in the Official Gazette.