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Welcome to the Liquidity Assessment

Liquidity

What's included in this section

  1. 1. Fund documentation and reporting
  2. 2. Issues of vehicle equity
  3. 3. Vehicle life extensions
  4. 4. Vehicle winding up
  5. 5. Redemptions of equity
  6. 6. Secondary market transfers of equity

Investors need to fully understand their liquidity rights when investing into a vehicle. INREV therefore establishes common standards of behaviour for managers and investors in non-listed real estate vehicles in the context of the exercise of liquidity rights.

The manner in which equity is subscribed to and redeemed from a vehicle has a material impact on the interests of new and existing investors. Overseeing the establishment of a fair liquidity mechanism and the disclosure of it to investors should be one of the objectives of a vehicle’s corporate governance activities. In some jurisdictions and in relation to certain vehicle structures the mechanism is prescribed by legislation or government regulations. In these cases, full disclosure of the rights, obligations and process should still be considered best practice to ensure the vehicle is suitable for the investor.

INREV’s Liquidity Guidelines are based on a framework of six principles:

  1. Disclosure of investors’ rights
  2. Pricing mechanisms for equity issues
  3. Investors’ rights to transfer interests
  4. Legal and regulatory framework for liquidity
  5. Confidentiality arrangements shouldn’t be obstructive to liquidating interest
  6. Accessibility of information for potential investors

 

If you have any questions please contact the Professional Standards team under professional.standards@inrev.org or phone +31 (0)20 235 8600.