New York’s real estate market is one of the most prolific markets in the entire world. It is a fast-paced, thrilling, high-risk and high-reward real estate market. It is also highly expensive. Just look at how much of the population rents instead of owns their property. For those unable to invest in real estate directly – as well as those who can – there is another option: Real Estate Investment Trusts.
Real Estate Investment Trusts are companies that own and/or operate income-generating real estate properties. In New York, these properties are often apartment buildings, office buildings, or even city landmarks. Real Estate Investment Trusts (REITs) pool the investments of numerous investors, who then receive income from the properties without having to do anything with them personally.
Here’s a simplified version of how the process works. A lot of people all pay money to own a portion of a Real Estate Investment Trust company. That company uses that money to buy real estate property, which it manages and rents out. Those who occupy the properties – be they individuals or businesses – pay their rent to the REIT, who then divides the profits amongst the investors who own portions of their company. It is a way to make an investment and potentially see a payday from the real estate market without a gigantic starting cost.
So how does someone invest in a Real Estate Investment Trust? Shares are traded much like stocks. You can use a broker to buy shares in a particular REIT or sell any that you currently own. There are several different REITs available in New York City and across the state. They are highly liquid because of this structure, unlike traditional real estate investments. Shares are a great source of reliable income, but don’t offer much in terms of capital appreciation.
Of course, COVID-19 has affected the real estate market all across the country in a major way. The eviction moratorium means that plenty of properties that used to receive a steady income from rent are currently going without. Having said that, without giving any financial advice, today looks like a better day to start investing than a year ago did. As New York and the real estate market moves back towards normalcy, the cost of entry into investing may still be lower than usual.
Real Estate Investment Trusts can often lead to contractual disputes when it comes to commercial real estate. At Andrea L. Gamalski Attorney & Counselor at Law, we help navigate the complexities of all commercial real estate affairs. Contact Andrea L. Gamalski Attorney & Counselor at Law today with any of your New York commercial real estate issues. We believe in caring for you, so you can care for your family and your home.
Andrea L. Gamalski Attorneys at Law
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