Determinants of Asset Management Company Fees for Rental Housing Real Estate Investment Trusts : Focus on the Korean Context

The purpose of this study is two-fold: to examine the determinants of asset management company (AMC) fees for rental housing real estate investment trusts (REITs) in Korea; and to provide basic data for establishing an AMC fee system that can improve the expertise and capacity of AMCs that invest and manage such assets for the continuous growth of the domestic REIT market. In this regard, we obtained the panel data of rental housing REITs from 2019 to 2023 (accounting for approximately half of the domestic REIT market) and conducted an analysis by using the Hausman-Taylor model. The findings showed that the higher the dividend ratio to total assets, the higher the AMC fee ratio to total assets. This indicates that the AMC fees of rental housing REITs is based on the investment and management performance of the REITs. In addition, the business history, the equity ratio, the sales revenue ratio to total assets, and the public institution share ratio of REITs were found to have a positive effect on the AMC fee ratio to total assets, whereas the return on total assets and AMC ownership ratio were found to have a negative effect on this ratio. Based on these results, we proposed policies to promote the activation of the public rental housing REIT market, including measures for ensuring the continuity of REITs and facilitating their transition into multi-asset REITs.