RFF Management Fee Analysis

DYOR, not held, sentiment none

Separate to the Bonitas and Bucephalus claims, have been researching the common complaint that RFF has "high fees" and whether there was any truth to it

2019 Annual Report p29
At present, the Responsible Entity charges total fees (fund management and assetmanagement fees) of 1.05% of the adjusted gross asset value of the Fund.

RFM charging 1.05% seems reasonable as long as any increases to asset values are matched by increases to income generated from those assets

Checking the numbers and comparing fees to total income generated, a number of items stand out:



1. RFM has earnt management fees equal to 11-12% of total income. A small sample of other listed REIT's shows their fees at around 10%

2. When compared year on year and except FY17, RFM's fees as a % of total income have been increasing. Put another way, RFM's fees are growing faster than the total income generated from the RFF assets

3. RFM is entitled to receive reimbursements for a variety of expenses incurred whilst managing RFF. After dropping from the IPO highs, these expenses have settled to 6% of total income for the last 3 years. Would be interested to hear what others think about these expenses growing 1:1 with total income

4. With all fees and expenses combined, RFM is earning 17-18% of total income