Manulife US REIT - Annual Report 2020

NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 December 2020 27 SUBSEQUENT EVENTS (CONT’D) Preferred Units On 7 January 2021, Hancock S-REIT LA Corp., Hancock S-REIT Irvine Corp., Hancock S-REIT ATL LLC, Hancock S-REIT SECA LLC, Hancock S-REIT JCITY LLC, Hancock S-REIT DC 1750 LLC, Hancock S-REIT ATL Phipps LLC, Hancock S-REIT Centerpointe LLC and Hancock S-REIT Sacramento LLC (collectively, the “U.S. Sub-REITs”), and Hancock S-REIT Parent Corp (“Parent U.S. REIT”) have each issued 115 new preferred shares at US$1,000 per preferred share to persons who are unrelated to The Manufacturers Life Insurance Company and the Group (the “Preferred Shares Issuance”). The Preferred Shares Issuance is required in order to meet one of the requirements for the U.S. REITs to qualify for taxation as a real estate investment trust for U.S. federal income tax purposes under the United States Internal Revenue Code of 1986, as amended. Each of the preferred shares carries a fixed dividend of 12.0% per annum, are non-voting and are redeemable at the option of Parent U.S. REIT and each of the U.S. Sub-REITs. Immediately before the Preferred Shares Issuance, Hancock S-REIT Parent Corp has also redeemed all of its existing 125 units of preferred shares. The total redemption amount was approximately to US$0.1 million, which was funded from internal resources. The proceeds from the Preferred Shares Issuance will be used towards payment of the expenses incurred in connection with the Preferred Shares Issuance as well as towards the operating expenses of the U.S. Sub-REITs and the properties of the Group. COVID-19 pandemic The COVID-19 pandemic brought about disruption to the U.S. economy and businesses and in response the Manager implemented a variety of measures including rent abatement and deferrals to tenants whose businesses were impacted financially. As at the date of this report, and to the best of our knowledge, the fast rollout of vaccines has led to evidence of a nascent U.S. economic recovery, businesses reopening and a return to work. However, the effectiveness of the vaccines and the consequent pandemic situation remains uncertain both in the short and medium term. The Manager will therefore remain vigilant to risks as they evolve, and ready to take appropriate measures to safeguard Manulife US REIT and the interests of the Unitholders. 28 AUTHORISATION OF FINANCIAL STATEMENTS FOR ISSUE The financial statements were authorised for issue by the Manager and the Trustee on 12 March 2021. 166 MANULIFE US REIT