Bogotá has approved a new package of tax and urban development measures that will directly impact property owners, developers, and investors. The District Agreement 1084 of 2026, passed by the District Council, combines incentives to boost investment, urban renewal, and sustainability with new charges that may increase the cost of holding certain assets.
New Tax Surcharge to Fund Public Lighting
A key change will come in 2027 with a new surcharge on the unified property tax, aimed at financing and modernizing public lighting. The surcharge will have differentiated rates based on the property’s use, affecting commercial, industrial, and institutional properties, as well as developable land that remains undeveloped or unbuilt.
In some cases, delaying a project or keeping land undeveloped may become more expensive. The agreement also introduces significant incentives for urban renewal and real estate investment, including benefits in urban delineation and property tax exemptions of up to 10 years for projects incorporating housing in urban renewal treatments or sustainable mobility urban renewal projects (PRUMS).
Incentives for Multifamily Housing and Sustainable Projects
The agreement offers a substantial incentive for multifamily projects with over 50 housing units, providing a 100% to 10% property tax exemption for up to 10 years for long-term housing developments. This is particularly attractive for institutional investors, funds, and operators, as the reduced tax burden may lead to lower final rates, deepening this segment of the industry. Short-term rental investments and tourist housing are excluded from this benefit.
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Additional tax benefits are available for investments in real estate projects within the Fontibón and Engativá Airport Districts, sustainable buildings, new earthquake-resistant housing, cultural heritage properties, and environmentally protected land. These incentives are subject to specific requirements based on each project’s characteristics.
Voluntary Compensation Payment and Infrastructure Changes
Another innovation is the option for a voluntary compensation payment as an alternative to participating in land value capture for those benefiting from certain urban changes in land use, building capacity, or classification. This would replace the land value capture contribution payment on properties where it applies under Law 388 of 1997.
The reform extends beyond taxation. New public utility and telecommunications networks installed, expanded, replaced, or relocated in public spaces must use underground infrastructure, a requirement that may impact project design, costs, and timelines.
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