A further consultation is announced for 2012 on two specific aspects of the REITs regime. First, the role that REITs can play in supporting the social housing sector. Second, on the treatment of income received by one REIT from another, presumably this is with a view to exemption so that the underlying economics remain the same whether payment is received direct or through an intermediate REIT.
The second item would involve a limited technical change. But the first poses more challenges, to attract REIT investment into social housing is likely to require rethinking the distribution obligation, as well as the trading/investment divide. These issues are touched on in the most recent Olswang response to REIT consultation: