REITs have been available to investors in the Philippines since a 2009 law, but the market has failed to take off because a high public ownership requirement and transaction taxes turned off property companies.

Under the revised rules, REITs will only be required to sell 33% of their companies to the public, down sharply from the previously mandated 67%, the Department of Finance said.

Transfer of assets from the property firm to the REIT company will now be free of value-added tax, it added.

"We democratise wealth by opening access for thousands of small investors wanting to be shareholders in secure and profitable real estate projects," Finance Secretary Carlos Dominguez said in a speech.

REITs will harness additional resources from the capital market to help finance and develop infrastructure projects, he added.

REITs manage real estate assets that regularly generate profits, which are distributed to shareholders as dividends.

Ayala Land Inc, among the Philippines' top property firms, said last year it was looking to list a $500 million REIT, but it did not say when.

Ayala Land is a unit of Ayala Corp, the Philippines' oldest conglomerate, which has interests ranging from retail, wind and solar energy and telecoms to banking, healthcare, automotives and utilities.

The Southeast Asian nation's property sector is among the most vibrant in the region, with its office segment driven by business process outsourcing and online gambling, while retail continues to grow despite competition from e-commerce.

(Reporting by Neil Jerome Morales; Editing by Alex Richardson)