25 Jul 2018

Link REIT Enhances Investment Strategy and Distributable Income Computation

Link REIT (“Link”; Hong Kong stock code: 823), Asia’s largest real estate investment trust, announced that two special resolutions relating to the expansion of Link’s investment scope to include Relevant Investments and amendments to the definition of “adjustments” for computing total distributable income were passed at Link’s Annual General Meeting (“AGM”) today. 

George Hongchoy, Chief Executive Officer of Link Asset Management Limited, the manager of Link REIT, said, "The two resolutions approved today not only bring us in line with common industry practice, but also strengthen our ability to generate long-term value. The revised adjustments enable a fairer computation of distributable income, while Relevant Investments give us the flexibility to enhance our capital and treasury management through low risk and yield-enhancing tools to optimise returns for unitholders. Our investment focus, however, remains commercial properties in Hong Kong and tier-one mainland cities.”

The calculation of Link’s distributable income is based on “profit after tax” after eliminating the effects of certain adjustments. With the new resolution passed, more equitable treatment in distributable income computation can be achieved. As the amendments concern mainly non-cash items, they will have no material adverse impact on the distributions to unitholders.

Under the REIT code, REITs may invest in Relevant Investments which include unlisted debt securities, Government and other public securities, securities listed on the Hong Kong Stock Exchange or other internationally recognised stock exchanges, as well as local or overseas property funds. To reduce related investment risks, Link has imposed additional requirements including capping Relevant Investments at 10% of gross asset value.

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