Fees

Hi All,

I did some research on URB because of the discount to NTA and wanted to make the following aware to anyone considering investing.

The likely reason for the discount to NTA, under performance and under subscription at IPO was that this investment vehicle is a fee machine that makes it very difficult for investors to outperform.

You are essentially investing in a typical LIC that unimaginatively invests half the funds in listed property players and charges active fund manager fees of 0.5% base fee and a 15% performance fee over an 8% hurdle. The other half of the funds is invested into direct property investments that still incurs the previously mentioned fees but also incurs the below additional fees.

Any institutional player or high net worth would not touch this vehicle and could get the same exposure without the double overlay of fees. The fee structure is actually quite sickening and unfortunately there's a 10 year management agreement. Another example of retail shareholders getting abused.

Investment Manager Fees:

- Base Fee = 0.5% of Total Assets
- Performance Fee = 15% of performance over a 8% hurdle

Additional Fees to the above:

Direct Property Assets that are Passive:
- Base Fee = 0.75% of Gross Asset Value (Including Debt)
- Performance Fee = 20% of performance over 8% hurdle

Direct Property Assets that are Active/Development phase:
- Project Management Fee = 5% of development costs
- Performance Fee = 30% of performance over an 8% hurdle and 50% performance over an 14% hurdle

All Direct Property Assets
- Purchase Fee = 0.75% of purchase price of the property
- Leasing Fees = not clear what they charge for this
- Debt Fee = 0.45% of debt raised ( would likely be incurred every 3 years with each new debt facility)