Decree Law No. 150/2017
- Issuer: Environment
- Diploma Type: Decree Law
- Number: 150/2017
- Pages: 6536 - 6540
Summary in plain english
This decree-law defines rules for transferring unused State-owned private domain real estate to the National Fund for Building Rehabilitation (FNRE — Fundo Nacional de Reabilitação do Edificado).
State-owned private domain real estate is property (houses, buildings and plots) owned by the State that can be leased or sold because it is not part of the public domain.
The National Fund for Building Rehabilitation (FNRE) is a special investment fund created by the Government to rehabilitate and place buildings on the rental housing market with rent that is affordable for the middle class.What will change?
It will be mandatory to identify real estate belonging to the State and other public entities and has the potential of being transferred into the FNRE. Integrating buildings into this fund will now be easier because some of the permits and formalities required in other forms of transferring State buildings will not be necessary.What real estate can be transferred to the FNRE?
The following real estate located in urban areas and belonging to the State can be transferred:
These rules can also apply, with necessary adjustments, to the real estate belonging to public companies, higher education institutions and other public entities.
These rules do not apply to:
- buildings or apartments in neighbourhoods where rent value is determined by the income of the people living there
- buildings or apartments used for social assistance
- buildings or houses classified or undergoing the classification process because they are of national or public interest.
1. By 30 March of each year, State services will send a list of real estate that can be transferred to the fund.
The list will be sent to the public company FUNDIESTAMO - Sociedade Gestora de Fundos de Investimento Imobiliário, which is the management company of the FNRE.
2. FUNDIESTAMO will analyse the real estate listings sent by the State services and identify those with the potential to be transferred into the FNRE. It will then conduct a feasibility study of properties to assess which ones should be transferred into the fund. For this, the rehabilitation costs and potential uses of the property will be considered.
The feasibility analysis will include:
- a request for more information
- property visits
- a property evaluation.
During this analysis (up to six months), the identified real estate cannot be sold, leased or used in a way that prevents its integration into the fund.
3. Once the feasibility study is complete, FUNDIESTAMO will decide whether or not the property should be transferred into the FNRE.
4. The property managing entity can accept or refuse the proposal to integrate the property into the fund. If it refuses, the fund management company may:
- give up the property
- make a new proposal
- counter the arguments presented by the property managing entity and refuse the opposition.
5. If the property managing entity and FUNDIESTAMO come to an agreement, the property will be transferred into the fund.
If both parties do not reach an agreement, members of the Government responsible for Finance, Housing and the area to which the managing entity of that property belongs will resolve the matter.
6. When a property is transferred into the fund, the State will receive, in shares, the amount corresponding to the value at which that property was evaluated.
The shares will be issued in the name of the entity managing the property included in the fund. This means that the entity can receive money resulting from the distribution of income earned by the fund.The earnings of the FNRE can be used for heritage conservation
The earnings resulting from the integration of buildings into the FNRE can be given, in whole or partially, to the Heritage Conservation and Rehabilitation Fund or the entities that managed the properties transferred into the fund.What are its benefits?
This decree-law is intended to:
- make FNRE more effective
- transform costly run-down State-owned buildings into rehabilitated buildings that can be leased to families and generate revenue for the State.
This decree-law comes into effect the day after being published.
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