REIT Real Estate Investment Trust Explained

REITs historically have provided investors of all types regular income streams, diversification and long-term capital appreciation.

REITs, or Real Estate Investment Trusts, are companies that own or finance income-producing real estate in a range of property sectors.

These companies have to meet a number of requirements to qualify as REITs.

Most REITs trade on major stock exchanges, and they offer a number of benefits to investors.

A REIT is a company that owns, operates or finances income-producing real estate.

REITs historically have delivered competitive total returns, based on high, steady dividend income and long-term capital appreciation.

Their comparatively low correlation with other assets also makes them an excellent portfolio diversifier that can help reduce overall portfolio risk and increase returns.

Modeled after mutual funds REITs provide all investors the chance to own valuable real estate, present the opportunity to access dividend-based income and total returns, and help communities grow, thrive and revitalize.

Types of REIT’s

Equity REITs

A company that owns or operates income-producing real estate

Mortgage REITs (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

PNLRs are registered with the SEC but do not trade on national stock exchanges.

Private REITs

Offers that are exempt from SEC registration and whose shares do not trade on national stock exchanges.

REITs must pay out at least 90 percent of their taxable income to shareholders and most pay out 100 percent.

REIT owned real estate, located in every state, is an important part of the U.S. economy and local communities.