What is the purpose of a real estate investment trust (REIT)?

The purpose of a real estate investment trust (REIT) is primarily to allow individual investors to earn income from commercial real estate. REITs function by pooling funds from a variety of investors to purchase, operate, and manage real estate assets that generate income, such as office buildings, shopping centers, and apartments. This structure enables individual investors to access opportunities in real estate investing without needing to buy or manage properties directly. By investing in a REIT, individuals can participate in the success and income generated by real estate ventures while benefiting from professional management and diversification of holdings.

In contrast, managing rental properties directly refers to the operational aspects of real estate investment, which is not the core function of a REIT. Assessing property for development potential is an important activity within the real estate field but does not align with the main objective of a REIT. Additionally, certifying transactions of commercial real estate pertains to legal and transactional work rather than the income-generating purpose of a REIT. The primary mission of a REIT is to provide investors with a way to generate income from real estate investments efficiently.