CCIV won’t fly for unlisted property funds

The Government’s proposed Corporate Collective Investment Vehicle (CCIV) would have ideally promoted investment in Australia’s property fund industry, but several requirements like tax treatments could hold it back for unlisted property funds, according to the Property Funds Association (PFA).

The CCIV, which would introduce a new, alternative investment structure to managed investment schemes, would perhaps be a little more attractive to unlisted property funds if regulations did not restrict listing the investment structure, according to PFA chief executive, Paul Healy.

“We would hope CCIVs could operate under the same regulations as listed investment trusts, as there may be times when an unlisted entity may choose to list,” he said. “Under current proposals this would be restricted, which may diminish the commercial appeal of the CCIV structure.”

Healy said the current proposals included compliance obligations on wholesale CCIVs, which do not apply to wholesale managed investment schemes, like registering and lodging a constitution with the Australian Securities and Investments Commission (ASIC), and rules around member meetings.

“The additional compliance burden makes operating a wholesale CCIV less attractive than operating a wholesale managed investment scheme,” he said.

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