Ivan Robinson of Lanka Real Estate notes:
With the announcement of the draft ‘Restrictions on Alienation of Land Bill’ having been passed in Parliament on the 20th of this month, the real estate sector in Sri Lanka is now set on the right foot to attract FDI in this specific field. After two years of uncertainty in this sector we now have a clear cut law that states that the previous 100% tax due on property purchases by foreigners is no longer applicable. The new law also states that a foreigner can now hold 49% shareholding of a company that buys land, which is up from the previous 25%, the balance 51% has to be held by a Sri Lankan nominee. After 20 years, this same company then gains the same rights as a Sri Lankan individual and can buy freehold land unconditionally. Also, a foreigner can lease property for 99 years by paying a one off tax of 15% based on the value of the lease.
This new law paves the way forward for a clear and transparent solution for foreigners, individuals or corporations, to invest in the Sri Lankan Real Estate market.
Hardy Jamaldeen, manager and director of Steradian Capital since 2010 is also bullish on real estate:
Along with the current growth trajectory many opportunities are continuously arising in the SriLankan Real Estate environment. The most exciting is the foreseeable demand for long-term income producing assets. Land and buildings can bridge this gap in the form of offices, industrial estates, shopping centers, student accommodation and hotels. Structuring these assets into bite sizes that the market can absorb will be the key to its success.
Read full article here.