A Canadian income trust currently structured as a Real Estate Investment Trust (REIT) is considering acquiring a diverse portfolio of property-management software companies. What should the trust's institutional compliance team consider most critically regarding the Specified Investment Flow-Through (SIFT) rules?

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Accepted Answer

This is correct. To maintain its SIFT exemption and flow-through tax status, a REIT must derive at least 75% of its revenue from specific real-estate sources, including rents, mortgage interest, or capital gains from real property.

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