Embassy REIT: Is this “Blackstone” promoted REIT is real diamond?

This may have been answered earlier, but unable to get full clarity on below points about REIT distribution:

1. Dividend component is well understood: Rental income after expenses
2. Interest component: How is REIT able to generate Interest income? In fact they should have interest expenses for the loan they take for new constructions
3. Return of capital: On one side REIT is taking loan or issuing new shares for new construction, and on the other side they are returning capital to existing shareholders. This is not adding up. Is this just to keep DPU artificially high? If yes, then we should remove this component from our yield calculation as they are returning our own money by raising capital somewhere else.

Can someone throw light on #2 and #3.

Thanks!