Agreement on the EU AIFM Directive between the European Commission, European Parliament and Member States appears to have been delayed. This provides an opportunity to confirm that the real estate sector is excluded which would be consistent with the intention of those who drafted the legislation. The Directive is intended to catch the managers of all types of ‘funds’, subject to certain exceptions. It is not intended to apply to all businesses. In particular, it is not supposed to apply to ordinary industrial or other operating businesses. The boundary is uncertain and particularly so in the real estate context.

Why is this idea important?

It should be confirmed that real estate groups and REITs are outside the Directive as operating businesses with no defined investment policy.

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