Overview

The units in ACRO-REIT (each, an “ACRO-REIT Unit”) and the units in ACRO-BT (each, an “ACRO-BT Unit”) are stapled together under the terms of a stapling deed dated 17 April 2019 (the “Stapling Deed”) entered into between Acrophyte Hospitality Trust Management Pte. Ltd. (formerly known as ARA Trust Management (USH) Pte. Ltd.), as manager of ACRO-REIT (the “REIT Manager”), DBS Trustee Limited, as trustee of ACRO-REIT (the “REIT-Trustee”) and Acrophyte Hospitality Business Trust Management Pte. Ltd. (formerly known as ARA Business Trust Management (USH) Pte. Ltd.), as trustee-manager of ACRO-BT (the “Trustee-Manager”, and together with the REIT Manager, the “Managers”), to form stapled securities in ACRO-HT (“Stapled Securities”, and each a “Stapled Security”). Each Stapled Security consists of one ACRO-REIT Unit and one ACRO-BT Unit, which cannot be traded separately. The Stapled Securities were listed on the Mainboard of Singapore Exchange Securities Trading Limited (the “SGX-ST”) on 9 May 2019.

ACRO-REIT is a real estate investment trust (“REIT”) constituted in Singapore by a trust deed dated 24 September 2018 (as amended) (the “ACRO-REIT Trust Deed”), entered into between the REIT Manager and the REIT-Trustee. ACRO-REIT is an authorised collective investment scheme under the Securities and Futures Act 2001 of Singapore (the “SFA”).

ACRO-BT is a business trust constituted in Singapore by a trust deed dated 29 October 2018 (as amended) (the “ACRO-BT Trust Deed”), together with the ACRO-REIT Trust Deed and the Stapling Deed (collectively, the “Trust Deeds”). ACRO-BT is registered as a business trust under the Business Trusts Act 2004 of Singapore (the “BTA”).

Corporate Governance

The REIT Manager holds a Capital Markets Services (“CMS”) Licence issued by the Monetary Authority of Singapore (the “MAS”) to carry out REIT management activities, in accordance with the Securities and Futures Act 2001 of Singapore (the “SFA”). In addition, employees of the REIT Manager who carry out regulated activities are appointed CMS representatives. The REIT Manager’s main responsibility is to manage ACRO-REIT’s assets and liabilities in the best interests of the unitholders of ACRO-REIT. The primary role of the REIT Manager is to set the strategic direction of ACRO-REIT and make recommendations to the REIT-Trustee on, amongst others, acquisitions, divestments, development and/or enhancement of the assets of ACRO-REIT in accordance with its stated investment strategy.

The functions and responsibilities of the REIT Manager and the Trustee-Manager include:

1. Using their best endeavours to ensure that the business of ACRO-REIT and ACRO-BT are carried out and conducted in a proper and efficient manner and to conduct all transactions with or for ACRO-REIT and ACRO-BT at arm's length and on normal commercial terms;
2. Preparing reports on a regular basis, which may contain forecasts on the net income, capital expenditure, sales and valuations, explanations of major variances from previous forecasts, written commentary on key issues and underlying assumptions on inflation, annual turnover, occupancy costs and any other relevant assumptions. The purpose of these reports is to monitor and explain the performance of ACRO-HT’s assets;
3. Establishing a framework of prudent and effective controls which enables financial, operational, compliance, environmental and information technology risks to be managed;
4. Ensuring compliance by ACRO-REIT and ACRO-BT (as the case may be) with the principles and provisions of the CG Code and other applicable laws, rules and regulations, including the SFA, the Securities and Futures (Licensing and Conduct of Business) Regulations (the “SF(LCB)R”), the BTA and the Business Trusts Regulations (the “BTR”), the Listing Manual, the Code on Collective Investment Schemes (“CIS Code” issued by the MAS, including Appendix 6 thereto, the “Property Funds Appendix”), the Singapore Code on Takeovers and Mergers, the Trust Deeds, the relevant MAS Notices and Guidelines, the CMS licensing conditions, any tax rulings issued and all other relevant legislations or contracts;
5. Attending to all communication with Stapled Securityholders; and
6. Supervising the hotel managers for management services such as running and managing of the hotels, marketing services, managing the overall annual business plans of the hotels and putting in place the necessary policies and procedures for the hotel operations pursuant to the respective hotel management agreements.

Both ACRO-REIT and ACRO-BT are externally managed by the REIT Manager and the Trustee-Manager, respectively. Accordingly, both ACRO-REIT and ACRO-BT do not have personnel of their own. The Managers employ experienced and well-qualified management staff to run the day-to-day operations of ACRO-REIT and ACRO-BT. The directors and employees of the REIT Manager and the Trustee-Manager are remunerated by the REIT Manager and the Trustee-Manager out of their fees and not out of the deposited property of ACRO-REIT, ACRO-BT or ACRO-HT.

For more details on the Managers' corporate governance practices and structures, please refer to the FY2024 annual report for the latest Corporate Governance Report.