Nontraded REIT waives fee

Oct 21, 2012 @ 12:01 am

By Bruce Kelly

Another large nontraded real estate investment trust plans to waive a heavily criticized fee tied to changes in its management.

KBS REIT II, which has $2.9 billion in total assets, said that it won't pay an internalization fee or compensation to its adviser, KBS Capital Advisors LLC, should the REIT decide to make a transaction such as acquiring its adviser.

REIT sponsors consistently have imposed the charge when the contract between the REIT and its outside adviser expires, with the REIT then acquiring the outside adviser.

That charge, which has drawn criticism because it typically isn't fully disclosed in offering documents, has cost investors in several big REITs hundreds of millions of dollars.

bkelly@investmentnews.com Twitter: @bdnewsguy

0
Comments

What do you think?

View comments

Recommended for you

Sponsored financial news

Latest news & opinion

The appeal and pitfalls of holding unconventional assets in retirement accounts

While non-traditional asset classes held in individual retirement accounts may have return and portfolio diversification benefits, there are "unique complexities" that limit their value for most investors.

Wells Fargo's move to boost signing bonuses could give it a lift

Wirehouse is seen as trying to shore up adviser ranks that took a hit after banking scandal

New Jersey fines David Lerner Associates for nontraded REIT sales

Firm will pay $650,000 for suitability, compliance and books and records violations.

Report predicts $400 trillion retirement savings gap by 2050

Shortfall driven by longer life spans and disappointing investment returns.

Wells Fargo will ramp up spending to lure brokers

Wirehouse, after losing 400 brokers in first quarter, is bucking trend among rivals who have said they are going to cut back on spending big bucks recruiting veteran advisers

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print