What is a REIT ?

Well, we’re going to go ahead and discuss that, we’re going to talk about what that means in real estate. We’re going to talk about the size of it in the different price points that it could be. We’re going to talk about how it could possibly impact different phases of the project and discuss all those things and more right now. So my name is Mike Acquisto and we’re going to be discussing REIT.

REIT is a real estate investment trust. Real estate investment trust is what that means. And what we want to do is just discuss it in general now so that we have more knowledge of it. As an agent. It might not be something that you’re involved in on a day to day basis, but what we consistently need to do is expand our real estate knowledge. There’s a lot of things that we talk about that aren’t applicable every single day.

But this is your business. This is your profession. We take it extremely serious. So what we’re doing is we’re catching on something over here on the side that is not necessarily related to exactly what you do every day. But the more knowledge you have, the better off you are. OK, so it’s often a large a large holding of different types of real estate, and it could be done in all different types of ways. So they would often have narrow focuses. So this rich or real estate investment trust would have a group of people that would put money into it in some way, shape or form.

They would buy shares or percentage percentage ownership or project ownership, but they would invest money into this. And this narrow focus for what this could be is they could invest in something like just office buildings that you leased out. So that would be an example of one that only focuses on office buildings that are existing and built.

They might be Class A. office buildings, which would be nice new ones. They might be classy buildings which are currently rented and in need of help and maybe getting revitalized or something along those lines so they’d have a focus that they would get right into that. So that’s an example of a REIT as it relates to just office buildings. There could be other ones. There could be one that just purchases land to hold and land banking for a long period of time, maybe a decade, maybe they see long shifts moving out, maybe something like somebody who came out to Frisco and moved here in two thousand.

So I myself moved here just about that same time. And I looked out the road and I heard these this concept. Right. I’ve heard all this Rex guy owns all this land on Preston on Preston Road in Celina. He owns all of that. And I heard that I’m like Celina that’s so far out, that’s going to take forever. And now I turn around and as anyone drove up the tollway and just looked around and you look on your right, you look on your laugh, you look on your right, look on your left, you just keep driving in.

All you see are the signs and they just say wrecks on them. So that was an example of Rex Clendenning getting way out in front of something, any land bank, the land a long time ago. And if there was other people involved, it could have been a reach that was looking at buying land for a long period of time out there. OK, so this that’s a concept of what a REIT is that gave you a couple of different examples of it.

You could buy shares, like I’m saying, on the open market, you could have a blended rate that has all different types of things such as a percentage of income, percentage of ones that are properties for land, for hold, has a certain amount of residential or commercial. You can have all different ways to focus on or could just be a blend of real estate in general.

Regardless, what it is, is basically buying a way to buy real estate without buying physical real estate yourself and participating you get a blended average return of a larger pool of properties. So there you go, there’s going to be different words that define it, characteristics that you need to achieve to be a. There has to be a certain amount of owners. There has to be a certain amount of disclosure.

There’s probably going to be a lot of S.E.C. regulations if it matches that, some of which you do need to be accredited investor to invest in and some you do not. So there’s many different things. But I just wanted to introduce the concept nonetheless and discuss it with you directly as an agent and just put that in the back of your mind. So you have that little personality going forward. Thank you.

Episode Links

Mike Acquisto , Acquisto Real Estate

Episode Recorded Live on YouTube 7.21.21

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