Learn the Basics of REITS & REIT Investing
What’s a REIT?
A REIT (pronounced REET), or real estate investment trust, is a company that owns, operates or finances income-producing real estate. Modeled after mutual funds, REITs historically have provided investors of all types regular income streams, diversification and long-term capital appreciation.
Approximately 170 million Americans own REITs through their retirement savings and other investment funds.
U.S. REITs contributed the equivalent of an estimated 3.4 million full-time jobs to the economy in 2022.
REITs of all types collectively own more than $4 trillion in gross assets across the U.S.
Why Invest?
Historically, REITs have provided competitive total returns, driven by consistent dividend income and long-term growth in capital value. Their low correlation with other assets makes them valuable for diversifying investment portfolios, thereby reducing overall portfolio risk and potentially increasing returns. These characteristics define REIT-based real estate investment.
What are the different types of REITs?
Equity REITs – a company that owns or operates income-producing real estate.
mREITs, – mREITs provide financing for income-producing real estate by purchasing or originating mortgages and mortgage-backed securities and earning income from the interest on these investments.
Public Non-listed REITs, or PNLRs – are registered with the SEC but do not trade on national stock exchanges.
Private REITs are offerings exempt from SEC registration, and their shares do not trade on national stock exchanges.
REIT Sectors
REITs invest in various types of real estate properties, covering a wide range such as offices, apartments, warehouses, retail centers, medical facilities, data centers, cell towers, infrastructure, and hotels. While many REITs specialize in specific property types, some diversify their portfolios by holding multiple property types.
How to Invest?
