REIT SAMPLE QUESTIONS

By Atty. Rey D. Cartojano, REC, REA, REB

1. How much of the distributable income of a REIT
should be given as annual dividends to its
stockholders? (a) 70%; (b) 80%; (c) 90%; and (d)
95%
2. What is the minimum number of shares that all
public stockholders of a REIT should hold? (a) 1; (b)
20; (c) 50; and (d) 100
3. What is the minimum number of public
stockholders that a REIT should have? (a) 500; (b)
1,000; (c) 1,500; and (d) 2,000
4. What is the ceiling of executive compensation
that should be given as annual pay of all directors
and principal officers of a REIT in relation? (a) 10%
of the net income before tax; (b) 15% of the net
income before tax; (c) 1% of the gross income; and
(d) 2% of the gross income
5. What is the ceiling of fees that should be paid to
fund and property managers of a REIT? (a) 1% of
the net asset value of assets under their
management; (b) 3% of the net asset value of
assets under their management; (c) 1% of the gross
income; and (d) 2% of the gross income
6. What is the limit of investments of income
generating real estate outside of the Philippines that
a REIT can undertake in relation to its deposited
property? (a) Not more than 30% ; (b) Not more
than 40%; (c) Not more than 50%; and (d) Not
more than 60%
7. A REIT has a governing board composed of 11
directors. How many of these 11 directors should be
independent? (a) 1; (b) 2; (c) 3; and (d) 4

8. What is the minimum paid up capital of a REIT?

(a) P100-million; (b) P200-million; (c) P300-million;
and (d) P400-million
9. By how much of the deposited property of a REIT
should be invested in income generating real estate?
(a) 65%; (b) 70%; (c) 75%; and (d) 80%
10. What is the minimum number of years of good
track record from date of acquisition that a real
estate should be considered as an allowable
investment of a REIT? (a) 3; (b) 4; (c) 5; and (d) 6
11. Synthetic investment products are derivatives
and other securities created exclusively out of one or
more financial instruments to simulate the returns of
the underlying assets or indices. By how much of the
investible funds should be allocated by a REIT on
these synthetic investment products? (a) Not more
than 1%; (b) Not more than 3%; (c) Not more than
5%; and (d) Not more than 7%
ANSWER KEY:
1.
2.
3.
4.
5.

C
C
B
A

90%
50
1,000
10% of the net income before tax
A 1% of the NAV of assets under their
management
6. B Not more than 40%
7. D 4
8. C P300-million
9. C 75%
10.
A3
11.
C Not more than 5%