REITs Introduction
Together with LOTTE, REITs become special.FAQs
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Which shareholders will be entitled for the dividend distribution?
All shareholders who hold LOTTE REIT share in the last working day of fiscal year closing months will be entitled for the dividend distribution.
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When will the dividends be paid?
LOTTE REIT plans to pay dividends bi-annually at the end of June and December each year.
The distribution of dividends will be determined through the board of directors’ resolution and the shareholders’ approval. The payment will be made within one month after such approval.
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Is the principal guaranteed?
LOTTE REIT is an investment-linked product which is not protected by the Depositor Protection Act, therefore the principal is not guaranteed.
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How does LOTTE REIT generate revenue?
Based on the master lease agreement with LOTTE Shopping, LOTTE REIT will receive fixed rental income from LOTTE Shopping with an annual escalation of 1.5%.
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How is the dividend amount calculated?
Pursuant to the Real Estate Investment Company Act, a REIT shall distribute at least 90% of its maximum distributable profit to the shareholders. In addition, the REIT may also pay dividends in excess of the maximum distributable profit to the extent that such amount does not exceed its depreciation cost.
As such, LOTTE REIT plans to pay dividends up to the sum of its net income and depreciation cost.
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Can you describe the master lease agreement with LOTTE Shopping in greater detail?
In the master lease agreement, LOTTE Shopping will lease the entire asset portfolio of LOTTE REIT and pay applicable rent expense.
With the master lease agreement, LOTTE REIT will be able to manage its entire asset portfolio without any vacancy risk.
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Can you describe the triple-net structure in greater detail?
In the triple-net structure, the lessee will bear not only the rent expense but also all taxes, insurance costs, maintenance and repair expenses with respect to the leased properties.
Based on the triple-net based master lease agreement with LOTTE Shopping, LOTTE REIT is expected to lower its maintenance burden on the properties and therefore offer a more stable dividend yield to the investors.