A Real Estate Investment Trust (REIT), is any type of trust, association, or corporation that specializes in real estate and mortgage investment. They generally act as agents on behalf of people who are interested in real estate shares. Basically, these shares are based on a wide range of income-generating properties, including commercial offices, retail centers, apartment complexes, warehouses, hotels, hospitals, and other types of properties.
REIT’s operate in a manner that is very similar to stocks and other securities; they can be traded and sold in major exchange markets. Advantages of real estate investment trusts include high yields for investors, as well as a highly mobile and liquid form of real estate investment. Some REIT’s may receive special tax benefits and considerations.
What Are Some Different Types of Real Estate Investment Trusts?
A person can invest in a real estate investment trust either by buying shares in an open exchange, or investing in a fund that focuses on public real estate. These types of REIT options generally come in three forms:
- Equity-based REIT’s: These are trusts where people invest in property, with revenue being generated mostly from rental property. The investor will be responsible for the equity of the REIT asset.
- Mortgage-based REIT’s: These are based on ownership of mortgages and mortgage interests. These involve either lending money for mortgage purposes, or purchasing mortgages and mortgage-based securities. Revenue is based mainly on interest from the mortgage products.
- Hybrid REIT’s: These combine both equity and mortgage-based interests
The type of REIT that a person invests in will depend on many factors, including the person’s goals and financial capabilities, as well as local markets and state finance laws.
How Are Real Estate Investment Trust Disputes Resolved?
Like any security interest, real estate investment trusts can be subject to a number of different types of legal disputes and securities violations. First and foremost among these is REIT fraud. Investors should steer clear of any REIT companies or agencies that don’t seem legitimate or that make questionable claims. Investors should also decline any offer that would require them to make a deceitful or fraudulent claim on an application.
REIT fraud may be considered a white-collar crime and may be punished according to corresponding laws. Other REIT disputes may include: breaches of contract; failure to maintain equity or mortgage requirements; and property appraisal disputes. These are often remedied in civil court through a monetary damages award.
Do I Need a Lawyer for Help with a Real Estate Investment Trust?
REIT’s can sometimes involve complex calculations and considerations of many factors. They can also involve a number of different local and state laws. You may need to hire a real estate lawyer in your area if you need help with an REIT or any related issue. Your attorney can help research the laws in your area to determine which options might be best suited for you. Also, if you need to file a lawsuit, your lawyer can help you file a claim with the court and can represent you during hearings.