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Singapore Reits & Business Trust Sector: Pseudo-Performance and Other Fees
SUMMARY
- The performance fee is an incentive for managers to grow the income and distributions of REITs, but half of the 41 REIT managers charge performance fees that are paid even if there is a decline in distributable income and/or distributions.
- This is because the performance fee is pegged to a percentage of the REIT’s net property income (definition varies) and is paid whether this income, or a similar metric, increased or decreased.
- The 5 business trusts (BTs), on the other hand, have performance fees that are pegged to an increase in distribution per unit (DPU), or beating certain DPU benchmarks.
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- Singapore Reits & Business Trust Sector: Pseudo-Performance and Other Fees19 May 2026
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