Europe

Coskun: Investors Should “Be Wary” of Golden Visa Funds Investing in Hotel Operations


Speaking to IMI during Global Citizen Week in Saigon earlier this month, Murat Coskun, Managing Partner of Get Golden Visa, fielded questions about how his firm determines which Portugal golden visa funds his firm recommends or warns clients about. He also indicated golden visa applicants need to consider the regulatory risks of funds investing in real estate assets, even if indirectly.

“The most important thing is the team behind the fund,” responds Coskun when questioned about his fund selection criteria. “Who are they? What is their track record? What have they done before?”

But beyond merely considering the track record of the fund advisors and managers, Coskun says it’s also vital to look at the same factors for the individual companies in the fund’s portfolio.

Apart from the team and track record of both the fund and the companies in which it invests, Coskun also highlights the fund’s portfolio composition as a critical dimension to consider:

“What are they investing in? What’s the investment theme? Do we see a promise and a potential behind this theme?”

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He says another crucial question is whether the fund is well diversified in terms of the sector on which it’s focused.

Questioned as to whether he believes property developers in the golden visa market now attempting to pivot to funds will be successful despite investing in hotel properties, Coskun indicates there is a chance it will work but that it’s a risky move.

“The Portuguese government made it pretty clear that they don’t want real estate, directly or indirectly, within these funds,” he says, but also acknowledges that the legislation, at least prior to the publication of more detailed regulations, is broadly defined and therefore open to interpretation.

“Regardless of how well-structured and what track record these real estate companies have, the SEF [now AIMA], as well as the CMVM [Portugal’s securities commission], may see these funds as still being related to real estate, regardless of whether there’s a prop-co/op-co separation,” he remarks.

“So, I would be wary of those. I wouldn’t invest my money, seeing that there may be a risk of my golden visa being jeopardized. We wouldn’t incentivize or advise our clients to go towards anything that may pose a risk in the eyes of SEF or CMVM in terms of golden visa eligibility.”

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