First distribution delay

Distribution delay is the period between when rental income, dividends, or profits from a real estate investment are generated and when those funds are paid out to investors.

Context

In real estate, distribution delays can affect cash flow planning. These delays may occur due to administrative processes, legal requirements, or logistical issues related to the transfer of funds. Understanding the length of the delay helps investors anticipate when they will receive returns and plan accordingly.

Example

If a real estate investment trust (REIT) earns profits in the first quarter but has a distribution delay of two months, investors might not receive their payouts until the third month, impacting their cash flow expectations.