1. Fees and Charges associated with REITs
These represent one-time fees that a REIT investor pays for investment/disinvestment in a REIT. Details of these fees and charges are disclosed in the offering documents of REITs. Details of all these fees and charges are disclosed in the offering document of REITs. These include:
This load is charged to the REIT investor upon purchase of units of the fund.
This is a fee charged by the RMC for the management of REIT. The RMC is entitled to be paid in amounts on monthly basis out of the REIT property, which is overdue of the added remuneration of an amount not exceeding three percent (3.00%) of the average annual Net Assets of the REIT during the first five years. Also an amount not exceeding two percent (2.00%) of the average annual Net Assets of the Fund thereafter its calculated on a daily basis during the year.
Trustee & Custodial fee
This is the fee charged by the trustee for the provision of services for the REIT’s assets. The Trustee is entitled to a monthly remuneration out of the REIT property based on an annual tariff of charges as per tariff structure disclosed in offering document. The annual tariff is applied to the average of the annual net assets of the REIT as calculated on a daily basis during the year.
These include all expenses incurred in connection with formation and registration of REIT. Consists of but not limited to execution and registration of constitutive documents; fee payable to SECP, auditors' fee, fee payable to rating agencies, legal costs, printing cost, brokerage and transaction cost. This also covers bank charges, borrowing and financing cost, hedging cost, taxes, duties and other cost levied by foreign jurisdictional foreign investments. The cost of registration of assets in the name of trustee and listing fee payable to stock exchange also comes under other costs.
2. Expense Ratio
Expense ratio is the REIT’s annual operating expenses, expressed as a percentage of the REIT’s property. Expense ratios are important to consider when investing in a REIT, as they can significantly affect returns.
3. Fund Manager Report
This is a report produced by the REIT management company wherein information on composition and performance of the REIT is presented. Fund Manager Report shall appear on the website of the REIT management company.
4. Rights & Obligations of REIT Investor
As an investor in a REIT, one is entitled to receive periodical statements of accounts; inspect the documents of the REIT specified in the offering document and receive constitutive documents.