Anyone who works in the financial sector may have read about Real Estate Investment Trusts (REITs). Income-producing real estate is a rising element of the American financial industry.
REITs were established by Congress in 1960 to provide equal access to opportunities for investment in the real estate sector.
REITs had a market value of $1.25 trillion in the United States by 2020, providing considerable employment opportunities.
As an expanding sector, REITs are capable of offering rewarding career paths.
REITs are Capable of Providing a Rewarding Career Path
REITs are investment vehicles that own a variety of income-producing real estate assets – one can work as an employee or as an agent in these REITs.
REITs own various commercial real estate, such as office and warehouse space. They can also own retail malls, apartment buildings, or even hospitals. Some REIT firms also work with the financial side of real estate.
When working as an agent, one can assist businesses in acquiring valuable real estate properties as a kind of investment.
4 Reasons You Should Consider a Career in REITs
1) REITs Make Long-Term Investments In Real Estate
REITs are required by the SEC to distribute 90% of their taxable income to shareholders in dividends. These companies adhere to the rules set out by the US Securities and Exchange Commission.
To enter the market, they have to meet specific requirements.
If REITs allow investors to directly invest in commercial properties, they should be able to buy, own, and sell commercial assets themselves.
In the United States, the following types of REITs operate:
Asset-backed (equity) REITs
Property management is either outsourced or handled in-house by these organizations. They also pay out at least 100% of dividends to shareholders.
Investments in mortgage REITs
These entities handle and purchase Commercial properties’ mortgages. As a result, this REIT will transfer 90% of its profits to its stockholders.
These REITs can manage and pay for the administration of real estate assets with the help of their preferred equity and debt.
Hybrid investment is the most common investment in REITs in the United States. Most of them are focused on properties that provide income for the investor.
Thus, one may have the opportunity to work for companies that invest in real estate for the long term.
2) Moving Within the Sector is Straightforward
It’s true that real estate investment trusts are a career option for those interested in finance and real estate.
A REIT agent can provide investors the opportunity to buy and profit from valuable real estate. Amateur investors may also be interested in hearing about your potential sources of dividend income. An agent would have the opportunity to assist communities in thriving this way.
REITs offer several possibilities to broaden the career paths of those working with them, which helps create a rewarding career path.
There are several universities in the United States that offer REIT-related courses. One can earn a Master’s in Real Estate from Kogod University. Courses and programs that fall under this category include:
- Taking into consideration the value of the real estate
- Commercial building architecture
Management of real estate
It’s possible that taking one of these classes will ease one’s transition into the sector. In addition to internships, they will need real-world experience in the industry. If one is interested in a bachelor’s degree in a specific discipline, such as
3) Opportunity to Represent and Manage Properties in a Hot Housing Market
Employees of real estate investment trusts (REITs) employees may research potential investments, manage rental buildings owned by investors, or oversee the construction of income-producing assets. An accredited agent carries the responsibilities of handling operations and finding value-based properties.
Some businesses have contracts with independent brokers. As a property manager, you’ll represent the properties and conduct tenant screenings for these organizations.
Certifications are an excellent method to get into the Real Estate Investment Trusts industry in the United States. One will need a license to sell real estate as a firm or broker. In addition, the CCIM Institute requires that they or their firm be a Certified Commercial Investment Member.
4) Numerous Opportunities for Employment
Several types of job portfolios are available in REITs with handsome salary packages. Here is a list of the highest-paying employment opportunities in the US REITs industry.
$45,000 to $59,000 per year is the estimated salary range
A real estate investment trust (REIT) will hire you to serve as a third-party property manager. Finding new real estate properties for their organization is a task for these managers.
A financial analyst at a real estate investment trust may expect to make over $100,000 annually on average.
Financial analysts who work with real estate investment trusts (REITs) need expertise in real estate markets and laws, as well as an understanding how money affects the value of assets.
When it comes to real estate, the primary concern of the Financial Analysts is ensuring that their employers get the best possible return on investment (ROI) from any property they buy or sell. In addition, they often perform cost-benefit studies to evaluate if proposed alterations to the business make financial sense.
The average salary for someone with five years of experience is around $49,000.
Asset Managers play an important role in ensuring that the investments made by the clients on particular assets do not depreciate. At the same time, they work on the mitigation of risks.
This requires asset managers to keenly observe the market, analyze trends, and conduct research and calculations. The job also requires remaining aware of the political and economic situation of the country, which indirectly affects the value of an asset.
Average Annual Salary: $52,000 – $69,000
Acquisition managers for real estate investment trusts (REITs) are responsible for finding new investments for the firm to add to its holdings. They hunt for locations suitable for new developments and evaluate properties that are up for sale to see whether they would be a good fit for the company.
They deal with all the processes of the real estate closing process, including negotiating the acquisition of the property and handling the paperwork. They could also be engaged in selling any properties the corporation is looking to unload.
Acquisition managers usually make $120,000 per year.
Competencies Required for the REITs Industry
The REIT industry is not for everyone, even though it is lucrative. Scaling up in these firms requires a few crucial talents. Included in the list of skills needed are:
The competencies you need are:
- Understanding financial reporting
- Knowledge of the market
- Management of real estate and financial assets
- Inquiry into both real estate and financial matters
- Improved understanding of financial model models
In addition, one will need interpersonal abilities to help the company achieve its goals. However, being well-versed in the current state of the market is mandatory.
Much work has been done in the United States to raise awareness of this career path, including collecting numerous statistics. Working for a REIT is a way to build a career combining real estate and corporate finance knowledge.
If you have an aptitude for finance and real estate and are prepared to put in the time and effort to learn the ropes, working for a REIT could be a rewarding career choice. Consider all of your options carefully before making a final call.
Spend some time looking into different real estate jobs and other finance jobs. If you think about different options within your areas of interest, you’ll be sure to find a career path that suits you.
Disclosure: The author is not a licensed or registered investment adviser or broker/dealer. They are not providing you with individual investment advice. Please consult with a licensed investment professional before you invest your money.
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Tim Thomas has investments in real estate.
Featured image credit: Unsplash.