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Property expenses continue to exist after a property is tokenized and generally need to be accounted for before calculating investor distributions. Expenses can include maintenance, insurance, property taxes, management fees, utilities, repairs, financing costs, and other operating charges. Depending on the investment structure, these costs may be paid from property income before distributions are calculated. The tokenization platform can display relevant financial information and potentially automate distribution calculations using verified data. However, the blockchain does not automatically know the property's expenses. Accounting systems and property managers typically provide the necessary information. Investors should review how expenses are calculated because they can significantly affect net investment income.
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