Portfolio management companies and real estate portfolio management companies licensed by the Capital Market Board are entitled to establish real estate investment funds, to fund them with cash collected from qualified investors against participation shares, and to operate them as portfolios consisting of real estates, real estate rights and other assets and transactions defined in the legislation in accordance with the fiduciary property principles in favor of share holders, and such funds do not have legal person status.*
Real estate investment funds allow qualified investors to invest in real estate are subject to the conditions summarized below:
1. Real estate investment funds (GYF) may only be established by portfolio management companies and real estate portfolio management companies, and GYF participation shares may only be sold to qualified investors.
2. Minimum 80% of the total value of a GYF must be invested in real estate.
3. The term real estate refers to plots of land, house, apartment, office, shopping mall, hotel, logistics facility, warehouse, park, hospital and all kinds of immovable property.
4. The assets included in the portfolio of a GYF must be stored by an independent portfolio depository service provider in accordance with the international applications.
5. GYF has legal person status only for the purposes of registering it with a land registration office and deleting or amending such registration.
6. The portfolio of a GYF must increase to minimum TL 10,000,000 within maximum one year after starting participation shares of that GYF.
7. GYF may be established for a defined or undefined period.
8. A performance fee may be charged by the fund manager for the real estate portion of the portfolio of a GYF, provided that the fee must be stated in the bylaw of that GYF.
9. The investments made by a GYF in real estate must be assessed by the Capital Market Board or an assessment service provider licensed by the Capital Market Board at least as of the end of each calendar year.
In order to comply with the interest-free financing principles, a real estate investment fund must invest and must be managed in accordance with the said principles and be approved by the Advisor Board.
*Real Estate Investment Fund Communique III-52.3, Turkish Official Gazette, 28871, 3 June 2014