1Q: What is a REIT?
A: A REIT, or Real Estate Investment Trust, is a company that owns, and usually, operates income-producing real estate such as hotels, apartments, shopping centers, offices and warehouses. Some REITs also engage in financing real estate. To qualify as a REIT, a company must annually distribute at least 90 percent of its taxable income in dividends to its shareholders. However, like other businesses but unlike partnerships, a REIT cannot pass any tax losses through to its investors. Moreover, any company designated as a REIT must invest at least 75 percent of its total assets in and derive its income primarily from real estate held for the long term and from other limited items. Significantly, a REIT is permitted to deduct dividends paid to its shareholders from its corporate tax bill. As a result, REITs have an incentive to remit 100 percent of their taxable income to their shareholders and therefore avoid corporate tax. Shareholders pay taxes on the dividends and capital gains received.
REITs were created by Congress in 1960 to allow average investors the opportunity to invest in large-scale, income-producing real estate. In the same way that shareholders benefit by owning stocks of other corporations, shareholders of REITs earn a pro-rata share of the income produced through ownership of commercial real estate.
For further information about REITs, visit NAREIT, the National Association of Real Estate Investment Trusts. www.nareit.com
2Q: Why invest in a REIT?
A: REITs offer distinctive advantages for investors, such as
- Current, comparatively stable dividend income
- Potential for dividend growth that has consistently exceeded the rate of consumer price inflation
- Typically high dividend yields that may be partially tax-deferred
- Portfolio diversification, designed to minimize risk through investing in a portfolio of properties rather than a single property
- Professional management: skilled management by experienced real estate professionals
- Disclosure or performance monitoring: by the Securities and Exchange Commission; the business and financial media; and directors, auditors and analysts independent of the REIT
3Q: How do REITS measure financial performance?
Apple REIT Six, Inc. management considers Funds from Operations (FFO) as an important supplemental measure of financial performance to net income. FFO was established by the National Association of Real Estate Investment Trusts to recognize that income-producing real estate does not typically depreciate on the basis determined under GAAP. NAREIT defines FFO as net income excluding gains or losses from sales of most property and depreciation of real estate. FFO is reconciled to net income.
For further information about REITs, visit NAREIT, the National Association of Real Estate Investment Trusts. www.nareit.com
4Q: How can I invest in Apple REIT Six?
A: At this time, it is not possible to invest in Apple REIT Six. The Company's units were entirely sold through a best-efforts offering by David Lerner Associates, the sole Managing Dealer. That offering closed in March 2006, when all the units were sold.
In addition, there is currently no public market for Apple REIT Six shares; therefore, they are considered illiquid and cannot be traded, sold or transferred. In the immediate future, we do not plan to cause the shares to be listed on any securities exchange or quoted on any system or in any established market. As stated in the Company's Prospectus, shareholders must be prepared to hold their investment for an indefinite length of time.
5Q: Since Apple REIT Six shares are considered illiquid, is it possible to sell my shares?
Although we are under no obligation to take any of these actions, in order to provide liquidity to shareholders, we could either:
(1) list the common shares on a national securities exchange or have them quoted on the NASDAQ National Market System; or
(2) with shareholder approval, dispose of all of our properties in a manner which will permit cash distributions to shareholders.
Shareholders who have held their units for at least one year may receive limited interim liquidity through participation in our Share Redemption Program. Information regarding this option can be obtained at David Lerner Associates at 1-800-367-3000.
6Q: Is it possible to reinvest my dividends in the company?
A: Apple REIT Six provides shareholders with the opportunity to purchase additional shares of stock through the reinvestment of distributions. Information regarding this option can be obtained at David Lerner Associates at 1-800-367-3000.
7Q: What is the company's dividend history?
A: Please visit the Investor Information webpage for a detailed chart of our dividend history.
8Q: When is the next dividend payment date?
A: Dividend distributions are scheduled to occur on or about the 15th day of every month, or on the next business day following the 15th when the 15th falls on the weekend or on a holiday.
For any other questions regarding your dividend payment, contact David Lerner Associates at:
477 Jericho Turnpike
P.O. Box 9006
Syosset, NY 11791-9006
1-800-367-3000
www.davidlerner.com
9Q: How do I find out how many shares of the company I own?
A: You must call your investment advisor at David Lerner Associates to determine the number of shares that you own. David Lerner Associates can be contacted at: 1-800-367-3000.
10Q: How can I arrange for the direct deposit of my cash distributions?
A: Your investment advisor at David Lerner Associates can help you arrange for the direct deposit of your cash distributions. David Lerner Associates can be contacted at: 1-800-367-3000.
11Q: What is Apple REIT Six's cusip number?
A: 037852
12Q: When is the next Annual Meeting of Shareholders?
A: The 2007 Annual Meeting occurred on May 8, 2008 at 11:00 A.M. Eastern Time at the Company's headquarters in Richmond, Virginia. The 2008 Annual Meeting has not yet been scheduled.