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One characteristic of logistics facilities is that the ratio of building value to land is typically high, and so depreciation expense tends to be higher than for other asset classes. The basic policy of CRE REIT is to make distributions in excess of retained earnings each fiscal period on an ongoing basis (“Ongoing Surplus Distributions”), in principle, upon examination of alternative uses such as the execution of repair plans or capital expenditures, the repayment of borrowings, and allocation to funds for the acquisition of new properties. Following comprehensive judgment, for the time being we have decided to target Ongoing Surplus Distributions equivalent to 30% of the depreciation expense for the relevant fiscal period. |