Hines Updates Partnership Structure

New provisions introduce refined unit classes, performance incentives, and mechanisms to support REIT compliance.

January 12, 2026

Structural Flexibility for Capital and Ownership

Hines Global Income Trust (HGIT) has revised the agreement that governs HGIT Properties LP, its primary operating subsidiary. The newly adopted Seventh Amended and Restated Limited Partnership Agreement, dated January 5, 2026, lays out structural and operational changes designed to streamline capital activity, clarify economic relationships, and reinforce REIT compliance across the platform.

The updated agreement gives HGIT more flexibility in how it raises and allocates capital. It formally authorizes the issuance of multiple classes and series of partnership units, including Class AX, D, I, IX, JX, S, T, and TX. These unit types correspond to HGIT’s REIT share classes and allow the General Partner to tailor fee structures, conversion mechanics, and distribution terms based on investor needs. The inclusion of Series 1 and Series 2 variations adds further customization—especially relevant for unit holders subject to different fee schedules.

The changes also support the General Partner’s continued qualification as a REIT. HGIT can now take broader action to ensure that partnership operations remain compliant with Sections 857 and 4981 of the Internal Revenue Code. The agreement includes safeguards that allow the General Partner to act preemptively if any risk to REIT status arises, including restrictions on ownership transfers that could compromise tax treatment.

Expanded Contribution Options and Tax Treatment

A key change involves the treatment of capital contributions. HGIT can issue new partnership units in several ways: in connection with REIT share issuances, in exchange for contributed property, or in lieu of fee payments. New language also outlines how properties acquired directly by the General Partner—outside of the partnership—can be treated as partnership-owned for distribution and tax purposes. That treatment allows for more integrated reporting and economic alignment across entities, without requiring full legal consolidation.

The agreement introduces a Performance Allocation structure tied to the partnership’s returns. HGIT Advisors LP, which holds Special OP Units, becomes eligible for a share of partnership profits above a 5% annual hurdle. The calculation accounts for both current-period returns and prior-year losses. If earned, the allocation is paid in cash or Class I Units, based on the Advisor’s election. Redemptions of those units follow defined procedures and are subject to ongoing liquidity management rules.

Redemption Rights and Capital Movement

For limited partners, redemption mechanics are clarified and expanded. Once eligible, a partner can request a redemption for cash or an equivalent number of REIT shares. The General Partner decides which form of consideration to deliver, depending on liquidity and timing. While most investors are subject to holding period and volume limitations, the agreement makes exceptions for the Original Limited Partner, the Advisor, and their affiliates. These carve-outs make it easier for internal stakeholders to manage capital more dynamically.

Transfer Restrictions and Governance Controls

The agreement also tightens control over unit transfers. Any transfer that could risk the partnership’s tax classification, violate securities laws, or trigger public partnership treatment under Section 7704 is subject to review—and may be voided. All assignees must meet specific admission criteria before becoming substitute limited partners.

From a governance perspective, the General Partner retains full management authority over the partnership. That includes everything from executing acquisitions to issuing new units and ensuring regulatory compliance. The General Partner is indemnified against liability unless it acts in bad faith, and the agreement provides detailed procedures for transitions in the event of a withdrawal, bankruptcy, or merger.

Tax and Accounting Framework

Supporting provisions cover tax reporting, capital accounts, and accounting treatment under Section 704(b), ensuring that allocations and returns remain aligned with REIT share ownership and economic value. Together, these changes give HGIT the infrastructure to scale its platform while preserving transparency, compliance, and investor alignment across its real estate income strategy.