Are you looking to build your career in the real estate industry? Interested to know how many job opportunities are available in Real Estate Investment Trusts (REITs)? Let's dive in and find out!
What is a Real Estate Investment Trust?
A Real Estate Investment Trust is a business or organization that owns and typically manages income-generating real estate assets. REITs can own residential, commercial, or both types of properties.
REITs can be privately held or publicly listed on major stock exchanges. Publicly listed REITs are required to distribute at least 90% of their taxable income to shareholders.
Commercial real estate examples include office buildings, warehouses, cinemas, shopping centers, hospitals, and hotels. On the other hand, residential real estate includes manufacturing homes, condominiums, private houses, and student housing.
Infrastructure, industrial, diversified, and retail REITs are other types to explore. Additionally, they can be equity REITs or mortgage REITs. There are various types of REITs available, but let's focus on the main ones below.
How do Real Estate Investment Trusts Work?
A real estate investment trust raises capital from organizations and individual investors to purchase real estate projects, which are then leased or sold.
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Investors in this form earn profits from renting and selling a portion of the assets they don't own or maintain.
Types of Real Estate Investment Trusts
a) Commercial Real Estate Investment Trusts
Commercial real estate investment trusts focus on purchasing assets for business use. Buildings or portions of buildings owned by commercial investment trusts are leased to companies.
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Retail investment trusts own buildings that house specialized retail shops. Additionally, commercial real estate can cater to most business-related needs.
b) Residential Real Estate Investment Trusts
Residential real estate investment trusts focus on purchasing houses that they rent out for profit.
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Large residential buildings that can accommodate multiple tenants at once are the primary target of residential real estate investment trusts. Additionally, residential REITs invest in different types of housing, including multi-family apartments and student housing.
c) Healthcare Real Estate Investment Trusts
Hospitals and elderly care facilities are structures that healthcare real estate investment trusts acquire.
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Especially as the US and global population continues to age, healthcare real estate investment trusts specializing in elderly care and healthcare facilities often perform well.
d) Hospitality Real Estate Investment Trusts
Tourism-related entities are the focus of resort and hotel real estate investment trusts.
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Globally, real estate investment trusts have the ability to own hotels and resorts more than individual private owners.
e) Industrial Real Estate Investment Trusts
Other investment trusts favor industrial real estate because it can provide high rental returns. In general, industrial real estate investment trusts lease factories and warehouses to other companies.
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For example, an industrial investment trust may manage a distribution center where your online orders are sent. Industrial real estate investment trusts also manage real estate projects related to manufacturing.
How Many Job Opportunities are Available in Real Estate Investment Trusts?
Similar to many other companies, a real estate investment trust has different positions within various departments. This means there are many job opportunities, and any suitable candidate can try their luck. Let's take a look at these positions to get a better understanding of each role.
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1. Real Estate Brokerage Manager
A broker and an agent are different from what people think. A broker is a real estate professional licensed to manage a real estate business with multiple other agents.
Real estate brokerage managers are licensed at a higher level than real estate agents. Additionally, real estate professionals are also licensed as independent brokers in some places.
Even if you have a license as an independent broker, you still need a higher-level license before you can hire brokers or even other agents to work for you.
Brokers are not allowed to let unqualified agents work for them as it carries significant risks and consequences. Additionally, brokers are responsible for training and supervising their agents due to the risks associated with brokerage management.
2. Asset Manager
An asset manager oversees the financial success and operations of a real estate investment trust's asset portfolio. To achieve their goals, asset management services need to work with procurement, accounting, finance, and development. Additionally, they must comply with SEC regulations and REIT requirements throughout their work.
3. Leasing Consultant
You will spend a lot of time interacting with tenants on behalf of landlords as a real estate leasing consultant. For most tenants, finding the ideal home and understanding lease contracts can be an exciting task, especially if you enjoy considering assets.
Finding the ideal rental property can be a challenge for tenants, so leasing consultants need strong communication skills. The responsibilities of a leasing consultant include managing lease agreements, scheduling property viewings, advertising rental listings, executing new lease agreements, negotiating lease terms with landlords, completing all paperwork, managing regulatory services, and more.
4. Real Estate Agent
The role of a real estate agent is to assist people in buying and selling real estate properties. Real estate agents can work with residential or commercial properties.
Those working with residential real estate act as intermediaries between buyers and sellers. Additionally, they work with residential properties, vacation resorts, condominiums, apartments, etc.
Commercial real estate agents connect sellers and buyers of commercial real estate. Their expertise lies in leasing office spaces, warehouses, hotels, resorts, and shopping centers.
To work as a real estate agent, you need to have a professional license. Remember that as an agent, you can advertise your real estate business through real estate SEO to rank higher. To improve your real estate business's search rankings, you can refer to the best SEO practices.
5. REIT Analyst
REIT analysts research and analyze new business opportunities. They help businesses make informed decisions regarding purchasing real estate projects.
Their responsibilities may include assisting with leasing, marketing, finance, and real estate acquisition. Additionally, analysts use financial tools and modeling to evaluate current assets and new projects for the company.
REIT analysts also monitor social media and the official websites of REIT companies. They also maintain the Geographic Information System (GIS) of the business.
6. Real Estate Attorney
In REITs, attorneys act as communication bridges between businesses, sellers, and buyers. Contracts are an essential part of owning real estate. Therefore, attorneys have to act as intermediaries between parties.
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Moreover, lawyers resolve legal disputes related to property ownership transfers. In addition to disputes about real estate ownership rights, they also participate in resolving, transferring, and registering ownership-related documents.
Finally, attorneys provide legal advice on real estate matters to both buyers and sellers. This ensures that everyone follows proper procedures, helping avoid real estate transaction issues.
To work as a lawyer in real estate investment trust finance, you need to have knowledge of real estate and law. Additionally, you can use law firm SEO to improve your company's website search result rankings.
Benefits of Real Estate Investment Trusts
a) High Returns
Due to the requirement to distribute at least 90% of their taxable income as dividends to shareholders, REITs have the potential to generate significant profits. This also implies that they can reinvest profits and expand faster than other investment options.
b) Diversification
You can diversify your portfolio by adding a REIT as a new asset. Through diversification, you can gain access to various types of real estate, such as office buildings, shopping centers, apartments, warehouses, and more. This helps reduce risks and increase income.
c) Transparency
REITs must comply with SEC regulations and are highly transparent. This provides additional protection to ensure that the management does not misuse investors' money.
Frequently Asked Questions about Job Opportunities in the Real Estate Field
1. Where is the most money in the real estate industry?
Your investment goals and purposes will determine this. Mortgage investment trusts may be suitable if you're looking for higher current income. As interest rates rise, mortgage investment trusts tend to perform better compared to equity investment trusts.
Regardless of your goals, REITs can help you access the real estate market and provide significant benefits that other investment options may not have.
2. What is the average return of REITs?
Depending on the specific fund and the overall economic situation, the average return of Real Estate Investment Trusts can vary.
The 10-year average annualized return for the index as of June 2022 is 8.34%. This index has a 25-year average return of 9.05% compared to the 7.97% return of the S&P 500 and the 7.41% return of the Russell 2000.
However, compared to other investment types such as bonds or stocks, various types of REITs often provide higher returns for investors. This is because REITs are legally required to distribute most of their profits to shareholders, ensuring a steady income stream.
In conclusion, the Real Estate Investment Trust industry offers a wide range of job opportunities across various positions. Whether you're interested in brokerage, asset management, consulting, real estate agents, analysts, or attorneys, REITs have a place for you. So, if you're passionate about the real estate industry and looking for job opportunities, the vast world of REITs awaits you!
