What is a Real Estate Investment Trust (REIT)?

A Real Estate Investment Trust (REIT) is an organization that purchases, owns, and manages real estate assets on behalf of its investors. This structure allows investors to pool their money together to invest in large-scale, income-producing real estate properties, such as shopping centers, apartments, office buildings, and hotels, without having to buy or manage properties individually.

REITs provide a way for individuals to invest in real estate markets while receiving dividend income and potential capital appreciation from the properties owned by the trust. They are usually publicly traded on stock exchanges, which offers liquidity similar to stocks but are specifically focused on real estate investments. This unique investment vehicle combines the financial advantages of real estate ownership with the accessibility of securities trading, making them a popular choice for both individual and institutional investors seeking regular income and diversification in their investment portfolios.