Investor Presentaiton
3. Opportunities and Challenges to REIT'S
Challenges to REITS in Pakistan:
Real Estate Sector under transition from informal sector to formal sector
Absence of sound governance structure within the industry creates lack of good practices, unreliable
construction quality, and legally protected purchase of units by the buyers.
Negligible Capital Allocation for Real Estate Sector by Financial Institutions
"Cities are built as they are financed". It is difficult for financial institutions to verify the character, capital, and
capacity of potential clients. Risk assessment and portfolio valuation is also fragile, which is another factor for
the lenders' extreme caution for real estate transaction. As a result, financial institutions are reluctant to enter
this market, which in turn causes scarcity of finance.
Absence of Tax Incentives by Government
Policy reforms and balanced tax approach required to attract new investment in REITs.View entire presentation