real estate investment trust

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Real Estate Investment Trust (REIT)

REITs invest in real estate or loans secured by real estate and issue shares in such investments. A REIT is similar to a closed-end mutual fund.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Real Estate Investment Trust

An investment company that invests exclusively in real estate and mortgages. The REIT issues a fixed number of shares at its establishment, and afterward neither increases nor decreases the number of shares. An REIT is actively managed, meaning that the real estate underlying the trust change from time to time in accordance with the fund's investment goals. A shareholder may trade shares in the REIT as if they were stocks. The value of shares in a real estate investment trust is determined by supply, demand, and the trust's net asset value. Importantly, the REIT itself is not taxed; rather taxes are passed on to shareholders.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

real estate investment trust (REIT)

A company that purchases and manages real estate and/or real estate loans. Some REITs specialize in purchasing long-term mortgages while others actually buy real estate. Income earned by a trust is generally passed through and taxed to the stockholders rather than to the REIT. See also equity REIT, mortgage REIT.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Real estate investment trust (REIT).

REITs are publicly traded companies that pool investors' capital to invest in a variety of real estate ventures, such as apartment and office buildings, shopping centers, medical facilities, industrial buildings, and hotels.

After an REIT has raised its investment capital, it trades on a stock market just as a closed-end mutual fund does.

There are three types of REITs: Equity REITs buy properties that produce income. Mortgage REITs invest in real estate loans. Hybrid REITs usually make both types of investments.

All three are income-producing investments, and by law 90% of a REIT's taxable income must be distributed to investors. That means the yields on REITs may be higher than on other equity investments.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.

real estate investment trust (REIT)

Congress passed the Real Estate Investment Trust Act of 1960 to allow small investors to pool their money into real estate investments and receive the same benefits as wealthier Americans who were able to purchase real property directly. REITs are special corporations that must invest only in real estate and must distribute at least 90 percent of their net income in the form of dividends,95 percent before 1999.In exchange,they are allowed to escape any income tax liability at the corporate level.

Many people describe REITs as real estate mutual funds, which is conceptually true except for one big difference: REITS are closed-ended funds,meaning investors cannot demand redemption of their shares,but can only trade them on the open market. With a real estate mutual fund (REMF) investors may demand redemption from the fund, even if the public market isn't buying. There is a wide variety of REITs:

• Overall, they are either equity REITs that invest in property or mortgage REITs that invest in mortgages.

• They are not allowed to operate high-management properties like hospitals or hotels, but they can hire outside companies for the management.

• REITs generally specialize in one of the following sectors: retail, health care, lodging, industrial, office, residential, or specialty (self-storage centers, restaurant properties, etc.). Some diversify across several sectors.

• Some are publicly traded on the stock exchanges, some are private, and some are unlisted. Unlisted REITS are also called non-exchange traded REITS; they file reports with the SEC but do not trade on the national stock exchanges. Private REITS do not file any reports with the SEC and are not traded on any national stock exchange.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.
References in periodicals archive ?
Typical umbrella partnership real estate investment trust (UPREIT) transactions include the formation of an operating partnership by a sponsor that contributes real estate properties and related debt to the operating partnership in exchange for a limited partnership interest.
The Dow Jones Wllshire Global RESI Index tracks some 240 real estate operating companies (REOCs) and real estate investment trusts (REITs) in 24 countries.
Browne is president and Chief Executive of Asset Investors Corporation a Real Estate Investment Trust with interests in more than $750 million of CMO variable-rate bond classes, and estimated 1991 taxable income of $35 million.
The company is an equity real estate investment trust and invests in the real estate markets of the US.
Real estate investment trust General Growth Properties Inc (GGP) (NYSE:GGP) has named Debra A Cafaro to its board of directors, the company revealed on Monday.
Co-author of what many REIT industry executives often refer to as the "REIT Bible" and the principal REIT tax treatise," The Real Estate Investment Trusts Handbook, Zief is widely regarded for his work in REIT and partnership tax issues.
In another sign of the widening appeal and growing availability of commercial real estate equity and debt securities, REIT and commercial mortgage backed securities issuance has surpassed the $1 trillion mark, according to data compiled by the National Association of Real Estate Investment Trusts.
Longua is the new director of the NYU REIT Center, a forum for the study and analysis of publicly traded real estate investment trusts (REITs), within New York University's Real Estate Institute.
Global index provider FTSE Group and the National Association of Real Estate Investment Trusts (NAREIT) have agreed to transfer the calculation and dissemination of the NAREIT Domestic Real Estate Index Series to FTSE and to rename it the FTSE NAREIT US Real Estate Index Series.
The yearly conference attracts leading practitioners from the worlds of banking, finance, law and real estate to discuss issues and trends affecting real estate investment trusts (REITs) both in the United States and globally.

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