Notes to the financial statements
Year ended 31 March 2016
1.
General (continued)
(d)
Fees under the lease management agreement (for the Singapore and China properties) (continued)
(ii)
Property tax services
For property tax services, the Manager or its nominees (as the Manager may direct) are entitled to the
following fees if as a result of the Manager’s or the nominees’ objections to the tax authorities, the
proposed annual value is reduced resulting in property tax savings for the property:
•
a fee of 7.5% of the property tax savings, where the proposed reduction in annual value is $1.0
million or less in Singapore, or RMB1.0 million or less in the PRC;
•
a fee of 5.5% of the property tax savings, where the proposed reduction in annual value is more
than $1.0 million but does not exceed $5.0 million in Singapore, or more than RMB1.0 million but
does not exceed RMB5.0 million in the PRC; and
•
a fee of 5.0% of the property tax savings, where the proposed reduction in annual value is more
than $5.0 million in Singapore, or more than RMB5.0 million in the PRC.
The above mentioned fee is a lump sum fixed fee based on the property tax savings calculated on a
12-month period less the expenses incurred to obtain the property tax savings and is not payable to the
Manager if the Manager’s objections are not successful or if the reduction in annual value results from an
appeal to the valuation review board.
(e)
Fees under the strategic and asset management agreements (for the Australia properties)
For strategic management services, the Group will pay the Ascendas Funds Management (Australia) Pty Ltd
(“AFMA”), a wholly owned subsidiary of the Manager, a strategic management fee of 1.0% per annum of the
adjusted gross revenue of each property.
For asset management services, the Group will pay AFMA an asset management fee (to be mutually agreed
between the Group and AFMA) under the asset management agreement. To the extent that the asset management
fees payable to AFMA exceeds the fees charged to AFMA by third-party licensed real estate agents and results in
a net positive balance for any financial year to AFMA (an “Excess”), the fees payable to AFMA under the strategic
management agreement will be reduced by the Excess such that the total fee payable to AFMA under both the
strategic management agreement and the asset management agreement, after taking into consideration the fees
charged by the third-party licensed real estate agents, will not exceed the aggregate fee of 1.0% per annum of
the adjusted gross revenue of the properties for which strategic management services and asset management
services are provided.
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A-REIT ANNUAL REPORT
2015/2016
