Since 2023 a growing share of Turkish citizenship files has moved away from property and deposits toward a third option: shares in real estate investment funds and venture capital investment funds regulated by the Capital Markets Board. USD 500,000, held for three years, certified by the SPK. The attraction is a professionally managed portfolio with a defined exit; the risk is that the return is not guaranteed. This article sets out how the route works and who it suits.
The rule
Article 20 of the Regulation implementing Law No. 5901 permits exceptional citizenship for a foreign national who acquires at least USD 500,000 — or the equivalent — in shares of a real estate investment fund or a venture capital investment fund, with an undertaking to hold them for three years. The Capital Markets Board certifies compliance.
The funds in question are collective investment vehicles established under Turkish capital markets legislation, managed by licensed portfolio management companies, with assets held by an independent custodian. They are not offshore structures, and they are not the shares of an ordinary company.
What the two fund types actually do
Real estate investment funds (GYF) hold portfolios of property and property-related assets — commercial buildings, residential developments, land, rental income streams. An investor buys exposure to a diversified pool rather than to one apartment. Returns come from rental income and from changes in the portfolio's valuation.
Venture capital investment funds (GSYF) invest in companies, typically growth-stage businesses, and return capital when investments are realised. The return profile is different in kind: longer, less predictable, and with a wider distribution of outcomes.
The two are grouped together in the regulation and are very different investments. An investor comparing them on the basis that both are "funds" is comparing a diversified property portfolio with a private equity commitment.
Why investors choose this route
- Diversification. A single property concentrates risk in one building, one district and one tenant. A fund spreads it.
- No management. No tenants, no maintenance, no tax filing for rental income, no repairs from abroad.
- Professional selection. The manager underwrites the assets, which addresses the central problem of the property route — that a foreign buyer is poorly placed to judge whether an apartment is worth its asking price.
- A defined exit. Fund shares are redeemed or sold according to the fund's rules, rather than requiring a buyer to be found for a specific apartment.
- Regulatory oversight. Licensed manager, independent custodian, SPK supervision, periodic reporting and independent valuation of assets.
The honest downside
A fund can lose money. A bank deposit returns the principal; a fund returns whatever the portfolio is worth. Over a three-year horizon, in a market with significant currency and valuation volatility, that is a real possibility rather than a theoretical one.
Three specific risks deserve naming:
- Valuation risk. Fund unit values depend on the appraisal of underlying assets. A property portfolio marked at optimistic values can be revised downward.
- Liquidity risk. Redemption is governed by the fund's rules, which may impose notice periods or windows. "Exit at three years" is a design feature, not a right exercisable on demand.
- Currency risk. Most of these funds are lira-denominated while the threshold is measured in dollars. Lira depreciation reduces the dollar value of the holding — which is both an investment loss and, potentially, a compliance question.
The currency point is the one most often glossed over in marketing material and the one most likely to cause difficulty.
How the investment is made
- Obtain a Turkish tax identification number.
- Open an account with a bank or licensed intermediary, and an investment account.
- Transfer funds from your own account abroad, through the banking system, retaining the foreign exchange purchase document where currency is converted.
- Select the fund. This is the substantive decision — see below.
- Subscribe for shares to a value of at least USD 500,000 equivalent.
- The shares are blocked for three years and the position registered.
- Apply to the SPK for the certificate of conformity.
Choosing the fund
The regulation sets a threshold; it does not select the investment. That remains entirely the investor's decision, and the differences between funds are larger than the differences between routes.
Questions worth answering before subscribing:
- Who is the portfolio management company, and what is its track record independent of citizenship marketing?
- What does the fund actually hold? Completed income-producing assets, or development projects that depend on future construction?
- How are assets valued, by whom, and how often?
- What are the total fees — management, performance, entry, exit — and what do they do to a three-year return?
- What are the redemption terms at the end of the holding period?
- Is the fund denominated in lira or foreign currency?
- Is the fund genuinely open to other investors, or was it constituted principally to serve citizenship applicants?
That last question is worth pressing. A fund whose investor base consists entirely of citizenship applicants has a redemption profile that is concentrated three years after each subscription wave — which is precisely when everyone wants their money back at once.
Comparison with property
| Direct property | Investment fund | |
|---|---|---|
| Minimum | USD 400,000 | USD 500,000 |
| Diversification | One asset | Portfolio |
| Management burden | Substantial from abroad | None |
| Overpayment risk | High for foreign buyers | Manager underwrites |
| Transparency | You see the asset | You rely on reporting |
| Exit | Find a buyer | Redemption per fund rules |
| Fees | Transfer taxes, agency | Management and performance fees |
| Certifying authority | Ministry of Environment and Urbanisation | SPK |
The USD 100,000 difference in threshold buys away the two biggest risks of the property route — overpaying, and being unable to sell — and replaces them with manager risk and fee drag. Which trade is better depends on the investor, not on the route.
Where these files go wrong
- Choosing the fund on the strength of the citizenship marketing rather than the portfolio. The brochure that talks mostly about passports has told you where its attention is.
- Ignoring fees. A three per cent annual management fee plus a performance fee is a meaningful drag over three years.
- Subscribing at exactly USD 500,000 in a lira-denominated fund. Currency movement can take the dollar equivalent below the threshold.
- Funds from a third party. Same source-of-funds requirement as every other route.
- Assuming redemption is automatic at year three. Read the fund rules on notice periods and redemption windows before subscribing.
Frequently asked questions
Is my capital guaranteed? No. Fund performance determines the value of your holding.
Can I switch funds during the three years? Only with care, and continuity must be documented. Plan not to.
Do I receive distributions? Depending on the fund's policy, distributions may be paid or reinvested. Distributions do not breach the undertaking; reducing the holding below the threshold does.
How is the holding valued for the threshold? On the dollar equivalent at the relevant date, which is why the denomination matters.
Can I invest through a company? The applicant must hold the qualifying investment. Structures should be checked before subscription, not after.
What are the tax consequences? Fund income is taxed under Turkish rules that vary by fund type and holder, and your country of residence may tax it too. Take tax advice before subscribing.
Does this route cover my family? Yes — spouse and children under eighteen.
Before you subscribe
This is the route where the legal question is the simplest and the investment question is the hardest. Meeting the threshold is straightforward. Choosing a fund whose portfolio, fees and redemption terms make sense over three years is not, and no amount of legal work substitutes for that analysis.
Dural Hukuk reviews fund documentation, subscription agreements and redemption terms alongside the citizenship requirements, prepares the source-of-funds file, and manages SPK certification through to the citizenship application. Call +90 535 260 74 54 or use the contact form on this site.
This article is general information on Turkish law as at August 2026 and is not legal or investment advice. Fund investments carry risk of loss; obtain independent financial advice before subscribing.