We do understand that most of the time, "yield" is the main consideration for investors to invest in REIT and of course other thanP/NAV , gearing , interest coverage ratio, asset quality , occupancy rate etc.
Other than normal property expenses such as interest & finance cost and operating expenses , management fee is also the major cost for a REIT. How often do we really look at the management fees as one of the criteria in selecting a REIT to invest ?
If every $1 we earn from the property but40cts goes to management fee , then we may need to pay more attention on this major cost as it may have huge impact on our long term investment return as some might say “ We just work for the Management !! “
In recent K-REIT’s AGM which I have attended last week , as usual , this issue of high management fees been brought up again by shareholders during the meeting. ( Mr. Manofired the first salvo … ) ...
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