Page 4 - ANJ Capital Market Presentation

Real Estate Investment Trusts (REITs)

REITs are investment vehicles that own, operate and manage a portfolio of
income-generating properties for regular returns. They are the real estate equivalent of
mutual funds - just as mutual funds hold a portfolio of equity, debt and money market
instruments, REITs hold a portfolio of varied real estate assets. These are spread across
commercial complexes, office towers, shopping malls, exhibition centres, hotels, IT
parks, to name a few.

REITs invest normally in commercial property where there is a scope to earn regular
income in the form of rent.

Typical REIT Structure

Sponsor(s) Other Unit Holders

Not less than 25% for three At least 25% of the value
years; not less than 15% at of REIT assets or USD 2.5
billion, whichever is higher
one sponsor, not less than
5% at all times by
each sponsor
Trustee

Land Sterling
Banks Land Sterling real estate
Capital Investment management
investment
Leverage up to 25% wihout REIT management company
credit rating and > 25% but agreement
< 49% with credit rating and
unit holders’ approval

Shares,
shareholder
loans
Promoters Other Investors

RE owner
Property company
or property sold by
RE owner 50% 50%

SPV 1 SPV 2 LLP

Facilities Manager