Ares Real Estate Income Trust Inc.

Overview

• NAV-based perpetual-life real estate investment trust (REIT) formed in Maryland on April 11, 2005.
• Operates through an umbrella structure with AREIT Operating Partnership LP as the operating partnership; AREIT serves as the general partner and a majority of assets are held through the UPREIT structure.
• Day-to-day management is provided by the Advisor under an Amended and Restated Advisory Agreement effective April 30, 2025; the current term ends April 30, 2026, and may be renewed by the board.
• AREIT has no employees; the Advisor and related entities provide management services.

What AREIT Does

Investment focus

• Invests in and operates a diversified portfolio of real property and real estate-related assets.
• Strategy covers residential, industrial, retail, office, and data-center properties; investments in real estate debt and securities; and select opportunities outside the U.S. (including Canada, Mexico, U.K., Europe, and Japan) in related sectors such as credit lease, self-storage, and infrastructure.
• Targets a diversified mix to generate current income, preserve capital, achieve capital appreciation, and provide multi-asset diversification.

Portfolio composition (as of Dec 31, 2025)

• 143 properties
• Approximately 30.5 million square feet
• Located in 34 U.S. markets

Capital raising and investment vehicles

• Ongoing private common stock offerings with a distribution reinvestment plan (DRIP).
• DST Program: private placements of beneficial interests in Delaware statutory trusts (DSTs) that hold properties; intended to offer replacement properties for Section 1031 Exchanges.
• DST Program Loans: financing of up to 50% of the purchase price of DST Interests for certain purchasers.

Financial highlights (selected, 2025)

Capital raised and funding activities

• Common stock gross proceeds in 2025: $335.5 million
• DRIP portion of 2025 proceeds: $31.6 million
• DST Program: 2025 gross DST Interests sold: $1.22 billion; DST Program Loans funded: $99.8 million
• Redeemed shares in 2025: approximately $122.5 million

NAV and share information

• NAV per share (class-by-class) as of 12/31/2025: $8.04
• Outstanding approximate balances by share/class (based on NAV per share of $8.04):
  • Class T-R: $183.8 million
  • Class S-R: $293.0 million
  • Class D-R: $45.9 million
  • Class I-R: $499.9 million
  • Class E: $319.9 million
  • Class S-PR: $46.3 million
  • Class D-PR: $3.2 million
  • Class I-PR: $69.6 million
  • Class B: $204.2 million

Operational cash flow and distributions

• Total distributions declared (2025): $139.4 million (includes $31.8 million reinvested via DRIP)
• Cash flow from operations (GAAP reconciliation): 2025: $253.6 million; 2024: $(169.5) million; 2023: $16.0 million
• Total distributions were funded through a combination of cash flow from operations, DRIP proceeds, borrowings, and sale of DST Interests.

Leverage and financing

• Leverage (as of 12/31/2025): 35.5% (borrowings, net of cash, divided by fair value of real property and related investments)
• Target leverage policy: 40–60% (subject to board adjustment)
• Variable-rate debt accounted for approximately 56.0% of total debt (as of 12/31/2025)
• Charter includes a 300% cap on debt relative to net assets, with possible exceptions approved by a majority of independent directors
• The company may use balloon payments on debt and may refinance or sell assets to meet obligations

Revenue sources and liquidity

• Distributions may be funded from cash flow from operations, asset sales, borrowings, and proceeds from securities offerings or DST Programs
• Maintains liquidity through cash equivalents, short-term investments, U.S. government/agency securities, liquid real estate-related securities, and borrowing facilities
• Share redemption program capacity limits: 2% of NAV per month, 5% per quarter, with carryover provisions; the board may suspend or modify redemptions

Management, structure, and governance

Management and conflicts

• The Advisor provides day-to-day oversight and investment execution; its compensation includes fixed and performance components tied to overall investment performance (subject to certain hurdles and waivers).
• Related-party conflicts of interest exist, including advisory fees, fund management, co-investments, and allocations among related entities.
• The AREIT Advisors Committee (within the Advisor) may execute acquisitions, dispositions, leases, capital expenditures, and borrowings within board-approved parameters; major actions require board or independent director approval.

Organization and legal structure

• Operates as an UPREIT with AREIT Operating Partnership LP (Delaware) as the operating vehicle.
• May issue multiple classes of common and preferred stock; charter-based ownership limits exist to maintain REIT status.

Liquidity and trading

• There is no public market for AREIT’s common stock; liquidity is expected primarily through the share redemption program.
• Stock purchases and redemptions are priced using the last disclosed NAV per share rather than a public market price.
• The company conducts ongoing private offerings and maintains a DRIP for capital deployment and shareholder reinvestment.

Investor information and filings

• Provides access to annual and quarterly reports via its website and SEC filings.
• Uses NAV-based pricing, independent valuation procedures, and limited auditor attestation of NAV.

Business model summary

• Raises capital through private stock offerings and DST Program offerings to acquire and manage a diversified, NAV-based portfolio of real estate properties and related assets.
• Uses leverage to amplify investment returns and maintains diversification across property types, sectors, and geographies, including some non-U.S. exposure.
• Generates income primarily through property operations and income from real estate debt and securities; distributions are funded from cash flow, financing, and asset sales.
• Ownership is structured through multiple share classes and an UPREIT framework, with management provided by the Advisor and governance by AREIT’s board, including independent directors.