Glossary

A Real Estate Investment Trust (REIT) is a company that owns, operates, or finances income-generating real estate properties. 🏢

REITs pool the capital of numerous investors, enabling them to invest in a diversified portfolio of properties, such as office buildings, shopping centers, apartments, and hotels. This structure provides a way for individual investors to earn income from real estate without having to buy, manage, or finance properties themselves.

For example, an investor could buy shares of a retail-focused REIT that owns shopping malls and receives rental income from the stores within those malls.

Fun fact: By law, REITs are required to distribute at least 90% of their taxable income to shareholders as dividends, 💰 which makes them particularly attractive for income-seeking investors. This unique structure is designed to ensure that profits are directly passed on to shareholders, avoiding double taxation.