Subscription to SCPI Shares: What you need to know

Real Estate Investment Companies (SCPI) are investment vehicles that allow savers to invest in real estate by pooling their funds. Subscribing to SCPI shares is an accessible process that allows you to diversify your portfolio while generating regular income in the form of rents. This article explores the essential steps of subscribing to SCPI shares, the criteria to consider, and the benefits of this collective real estate investment.

What is subscribing to SCPI shares?

Subscribing to SCPI shares involves buying shares in a company that invests in a portfolio of real estate assets, such as offices, shops, or residential properties. Each share represents a fraction of the ownership of the real estate assets held by the SCPI. The income generated by these assets is distributed to the partners (investors) in the form of rents, proportional to the number of shares held.

Steps of subscribing to SCPI shares

Subscribing to SCPI shares generally takes place in several steps:

• Choice of SCPI: It is essential to choose an SCPI that matches your investment objectives, whether it is yield, tax benefits, or capital gains. For example, a yield-focused SCPI may offer an annual return of 5%, while a tax-focused SCPI may be interesting for tax advantages.
• Subscription amount: Determine the amount you wish to invest. The minimum subscription amount may vary depending on the SCPI, but it is generally accessible starting from a few hundred euros.
• Administrative procedures: Fill out a subscription form and provide the necessary documents, such as an ID and proof of address. Some SCPIs allow online subscription, simplifying the process.
• Funds transfer: The subscription amount is usually debited from your bank account. The subscribed shares are then registered in your name in the SCPI's partner register.
• Receipt of first rents: Once the shares are subscribed, you will start receiving rental income proportional to your investment. This income is usually paid quarterly.

Benefits of subscribing to SCPI shares

Subscribing to SCPI shares offers several advantages:

• Diversification: By investing in an SCPI, you gain access to a diversified portfolio of real estate assets, reducing the risk associated with a single property or tenant.
• Accessibility: SCPIs allow you to invest in real estate with a reduced capital, without the management constraints associated with directly buying real estate properties.
• Regular income: The received rents are distributed to the partners, offering a stable and regular income supplement.

Concrete example

Let's say you subscribe to 50 shares of a yield-focused SCPI offering a distribution rate of 5%. If the subscription price is 200 € per share, you invest 10,000 €. You can then expect an annual gross income of 500 €, paid quarterly at 125 € per quarter.

Laws regulating subscribing to SCPI shares

In France, SCPIs are governed by the Monetary and Financial Code and are subject to the regulations of the Financial Markets Authority (AMF). These laws regulate the subscription conditions, the management of SCPIs, and the transparency obligations towards investors.

Conclusion

Subscribing to SCPI shares is an accessible and diversified real estate investment option, ideal for those who want to generate regular income while benefiting from the advantages of risk pooling. Before subscribing, it is important to understand the characteristics of the chosen SCPI and ensure that it aligns with your investment objectives. By following the steps described and consulting a financial advisor if necessary, you can optimize your investment in SCPI.