Is this much different to paying $100 as an Administrative fee? I mean owners can still calculate the final fee? What is the advantage of having per unit rate? In fact this per unit rate would magnify the rather meaningless headline rate which contracts are usually “sold” on.
Yes Owners can still calculate the final fees, as long as they look carefully at all the charges. It allows the SM to correctly say “We charge $x per unit as as a management fee”, but not say and we also charge per unit for
- Accounting services
- Banking management
- Disbursements
- online portal fees
- Trades compliance
So the actual payment to the SM is much larger than the $x management fee.
And also note that this is not charged to each unit as a flat rate, it is
Number of units x rate = Total
Then that total is charged to each unit in accordance with their unit entitlements
.