REITs were created by congress in 1960 to allow all Americans to get the opportunity from investing in income-producing real estate. REITS allow everyone to own or finance properties, in the same way, shareholders benefit by owning stocks and other corporations. The stockholder of a read earns a share of the income produced through real estate investment without actually having to go out and buy property. This article provides some insight into what REITs are and how they work.
Types of Real Estate Investment Trusts
The REIT industry has a diverse profile that offers many benefits and is classified into one of two categories Equity REITs or Mortgage REITs.
Real Estate Investment Trusts (REITs) own and manage income-generating real estate properties. They own a wide range of real estate, including apartments, offices, hotels, shopping malls, and industrial buildings. Equity REITs are publicly traded on major stock exchanges.
A mortgage real estate investment trust purchases mortgages and mortgage-backed securities to finance real estate. They make money by collecting interest and principal payments, as well as by selling securities or mortgages. They can be publicly traded or unlisted and are responsive to changes in interest rates. Investors receive dividends from them.
Size and Growth of REITs
In the past few years, the REIT market in the US has expanded dramatically. As of 2022, the market size of US REITs is approximately $1.2 trillion. Over the last ten years, this market’s size has increased at a compound annual growth rate (CAGR) of roughly 5-6%.
The rise of the REIT market has been influenced by a number of variables. One of the main factors is the increase in demand for income-generating investments. As a result, investors looking for consistent income may find them to be a suitable alternative.
The positive economic situation is another factor. While rising real estate values have raised the value of REITs’ portfolios, low-interest rates have made it more affordable for them to borrow money and buy properties. Furthermore, as REITs are frequently included in broad-based equity funds, they have benefited from the good performance of the overall stock market.
And finally, REITs are gaining popularity as a means for ordinary investors to invest in real estate. As a result, REITs are now more widely known and available to the public, which has enhanced their development.
In general, the REIT market is a large and growing sector of the global real estate market, and it is expected to grow going ahead.
Job Opportunities available in REITs
Based on Research there are more than 2.6 million jobs available in REITs. These organizations employ 307000 people full-time. similarly, REITs indirectly support 3.2 million jobs in the United States. REIT is a business that owns, manages, or Finances income-generating real estate. Publicly traded REITs must pay out. At least 90% of their taxable profits to shareholders in the form of dividends.
Types of Jobs are Available
There are different types of jobs available in the REITs industry are followed
This group of experts is in charge of buying, maintaining, and selling the properties that make up the REIT’s portfolio.
This group is in charge of overseeing the upkeep, tenant relations, and day-to-day operations of the REIT’s real estate holdings.
Finance and Accounting
To handle financial reporting, budgeting, and tax compliance, REITs use finance and accounting specialists.
REITs include legal departments to manage leasing, transactions involving real estate, and adherence to rules and regulations.
Marketing and Investor Relations
These experts are in charge of informing current shareholders and attracting new investors to the REITs.
Information Technology and Operations
To maintain the REIT’s computer systems, networks, and data management, REITs require IT and operations personnel.
Administrative and Support Staff
Additionally, employ support and administrative workers to take care of a variety of jobs like scheduling, reception, and data entry.
Skill Sets are Required for Job in REITs
Every company wants productivity and growth. So, skills and technical knowledge are important for growth and development. These skills help in earning potential, problem-solving, efficiency, and development.
- Real Estate Knowledge
- Financial Knowledge
- Strong Communication
- Leadership Skills
- Project Management Abilities
- Critical Thinking
- Problem-Solving Skills
- Technical Skills
- Project management skills
- Marketing skills
- Legal expertise
- IT skills
Salaries and Earning
Salaries and earning potential in the REIT industry depend on various factors, such as specific roles, the company, the location of the company, and the individual’s qualifications and experience. However, salaries and earning potential for common REIT positions are as follows:
|Position in Company||Yearly Salary in USD|
|Asset Management||$70,000 to $150,000|
|Leasing and Property Management||$50,000 to $100,000|
|Finance and Accounting||$60,000 to $120,000|
|Investor Relations||$70,000 to $120,000.|
|Legal and Compliance:||$80,000 to $150,000|
|Real Estate Development||$80,000 to $150,000|
|Information Technology||$70,000 to $120,000.|
Important Note: Some positions, like senior management roles, can have much higher earning potential with bonuses and incentives.
List of Major Companies
There are large numbers of companies. few of them are below.
- American Tower Corporation
- Public Storage
- Simon Property Group
- Equity Residential
- Host Hotels & Resorts
- Realty Income
How to Apply for REITs Jobs?
Many REIT companies have career pages on their websites, when they require a job they just publish a post for job openings and provide all instructions regarding the job and how to apply. Attend the events of the industry and meet the people who work in the industry. Similarly, contact the HR of the company through Email.
Tips for Jobs Seekers in Real Estate Industry
It’s important to design your CV and cover letter for each position you apply for when working for a REIT. Highlight your relevant experience, education, and skills that make you a good fit for the position. Do some research about the organization as well, and make sure your application reflects that understanding of the company’s business, goals, and mission.
Additionally, it’s important to be patient and persistent in your job search. It could take some time to find a job in the competitive REIT sector. Your chances of finding the ideal opportunity will rise if you keep applying.
Build a strong professional network: Finding employment opportunities in the REIT sector requires networking. Attending industry events, becoming a member of industry groups, and contacting colleagues.
Develop a strong knowledge of the industry: Learn about the many types of REITs, the key players in the market, and the most recent developments and problems the industry is facing. This will enable you to better target your CV and cover letter to certain job positions and demonstrate that you are familiar with the mission, fundamental values, and business practices of the organization.
Be flexible: the goals and targets of the industry are changing with time. So, be ready and aware of the industry sector.
- What is the structure of a real estate investment trust?
A Real Estate Investment Trust (REIT) is a kind of company that owns and operates income-producing real estate assets such as office buildings, apartments, stores, and hotels. These are publicly listed on major stock exchanges and are required by law to provide at least 90% of their taxable income to shareholders in the form of dividends. They have a board of directors, a management team, and staff, just like any other business. Different types of REITs, including equity, mortgage, hybrid, and specialty REITs, can be distinguished based on the types of properties they own and manage.
2. What are the advantages of a real estate investment trust?
- Diversify portfolio with.
- Potential for steady income.
- Professional management provided.
- Easy to buy and sell on major stock exchanges.
- Low barrier to entry for investors.
3. What multiples do REITs trade at?
These trusts are typically valued using financial metrics such as price-to-earnings ratio, price-to-funds from operations, and price-to-net asset value. These multiples are used to compare the REIT’s performance and valuation to other stocks in the market.
4. What are the pros and cons of a real estate investment trust?
REITs offer a way for investors to gain exposure to the real estate market by buying shares. Pros are diversification, high yield, liquidity, professional management, accessibility, and potential tax benefits. Cons include fluctuations in the real estate market and the dividends received by shareholders.