Press Releases

A new type of investment fund should be available later this year, to unlock billions in new capital for essential UK projects – from levelling up to net zero.

This is the Reserved Investor Fund, or RIF for short.

It is expected to be available to investors following Royal Asset to the forthcoming Finance Bill 2024. The RIF legislation is currently moving quickly through the latter stages via the Finance Bill and Government consultation on draft tax regulations, which ended on 14 May 2024. It has received widespread support from industry and constructive engagement with officials.

The RIF is based onshore in the UK – unlike offshore property funds – and it has an effective transparent tax status. This means investors are liable for tax on the income of the fund on an arising basis in accordance with their own circumstances.

It is quick to create and launch and straightforward to operate. It is hoped that such simplicity and flexibility will encourage a larger number of smaller asset managers to launch strategies using the fund structure.

The architect of the RIF is Melville Rodrigues, head of real assets advisory at Apex Group and a member of the Association of Real Estate Funds Public Policy Committee. As a law firm funds partner, he saw the gap in the UK fund offering, sacrificed his legal career to progress the campaign to plug the gap with the RIF and engaged with HM Treasury, HMRC and the Financial Conduct Authority officials.

Melville Rodrigues, head of real assets advisory at Apex Group and a member of the Association of Real Estate Funds Public Policy Committee: “It has been wonderful for me to lead the industry initiative, working over several years with Government and regulatory officials and the real estate industry. It’s a privilege to have developed a rapport with officials and to have attracted such goodwill, expertise and enthusiasm within industry. The draft RIF tax regulations reflect a pragmatic and robust way forward for Government, the regulator and industry.  

“With the RIF legislation being implemented, my passion is for the RIF to attract UK and international institutional capital (and in the process ease the burden on government finances) for regeneration of our town centres, more social and affordable housing and accelerating net zero goals. I’m looking forward to UK fund managers later this year launching RIFs.”

Paul Richards, CEO at the Association of Real Estate Funds: “We represent funds with £50bn in UK property investments alone. We expect the RIF to give our members and their investors, UK and overseas, quick and simple access to projects that can help the UK economy grow, house its people more effectively and make for a more sustainable way of living and working.”

Rachel Kelly, Assistant Director at the British Property Federation: “Removing barriers to real estate investment and ensuring that the UK has appropriate fund offerings for investors’ needs will be helpful in bolstering the UK's funds industry and important in addressing some of the biggest challenges of our time – including our net zero carbon targets, the regeneration of our high streets, and the development of more high quality homes. In order for the new Reserved Investor Fund (RIF) to be attractive to the widest pool of investors, the Government should ensure that the RIF is competitive with overseas equivalent fund vehicles. The UK must offer a truly competitive and viable onshore option.”

Sue Forster, Chief Executive at Investment Property Forum: “The Investment Property Forum, which draws members from a broad cross section of the UK real estate investment industry, is a longstanding supporter of this initiative to address a gap in the fund vehicles available for investment in UK direct property. We hope that this will facilitate investment at a time when unlocking capital for urban regeneration, housing and decarbonisation of our built environment is at a critical point.“

Lonneke Lowik, CEO at INREV: “We’re encouraged by the effort that HMT/HMRC put into the draft regulations and, going forward, hope solutions will be found for the key tax-related concerns. With a few adjustments, we envisage the RIF quickly becoming a UK domiciled fund vehicle that the non-listed real estate investment industry will find very attractive.”

Elizabeth Bradley, Global Head of Tax at BCLP: “We welcome the introduction of the reserved investor fund after months of consultation with industry on the new fund vehicle. Some investors are keen to have onshore fund vehicles.  We have found that with the now stronger UK REIT regime and hope that the reserved investor fund will be an additional option that investors will consider where their circumstances align with the sweet spots of RIF usage. It is hoped that the regulations are finalised during this Parliament, so that the momentum we currently have with Government to ‘get the RIF done’ is capitalised upon and we reach the finish line.”

Mark Eade, Partner at Blick Rothenberg: “I have been involved with the development of the RIF since near the inception, and have witnessed Melville taking a forward thinking role, leading the experts group, together with working to get the most positive engagement with HM Treasury and HMRC I have seen on any similar consultation process to date. The current position is very positive for the funds sector, both in terms of being able to offer competitive structures previously unavailable in the UK, whilst also supporting the wider fund sector.  I wait with a lot of interest to see how the first cohort of managers will use the new RIF regime and to see successes going forward.”