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Which has more impact on the average rate of return for a stockholder in a nontraded REIT, assuming an eight-year holding period, an elimination of acquisition fees of 1.00% or a reduction of asset management fees of 0.20%?

April 13, 2017

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Which has more impact on the average rate of return for a stockholder in a nontraded REIT, assuming an eight-year holding period, an elimination of acquisition fees of 1.00% or a reduction of asset management fees of 0.20%?

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Answer: The reduction in asset management fees has more impact, increasing average shareholder returns by roughly 0.20% over the eight-year holding period, while the reduction in acquisition fees increases those same returns by less than 0.20%.

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Matthew C. Strife
Blue Vault Services
April 11, 2016

Blue Vault's services are without question great resources for the review of the nontraded products offered.