4 features of the best performing private REITs

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4 features of the best performing private REITs
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Private REITs are a great way to enter the real
estate market. REIT essentially stands for Real
Estate Investment Trusts these are companies
that manage a portfolio made of various
money-making properties. There are namely 6 types
of REITs present in the market today and each is
identified on the strategy they use - Equity
REITs, Mortgage REITs, Hybrid REITs, Public
REITs, Private REITs, and public but
non-tradeable REITs.   In this article, we will
look at the 4 features of all the best-performing
private REITs present in the market today
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• Higher returns than their public counterparts
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• Regardless of which type of private REITs you
  decide to invest in, the good ones have a track
  record of providing higher returns when compared
  to their exact public counterparts. While private
  REITs are able to provide their investors with a
  minimum of 7 to 8 returns on their invested
  capital amount, public REITs are able to reach
  the bar of 5 to 6 returns on an average
  comparatively.
•  

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2) They are not very volatile   Since reit
investing are not listed on the public indices,
they are not affected by the fluctuations that
happen in the public market and are one of the
best ways to gauge the potential and strength of
the real estate industry at any given point. The
avalanche effect of the public markets is also
easily avoided, wherein, when one of the major
players of a certain industry has a falling stock
price, the share price of their competitors in
the same industry also starts to drop. Since
private REITs are not connected to each other and
their income solely depends on their own
performance, the returns they provide have
infrequent updates when compared to their public
counterparts.
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3) They have a lower compliance cost   Public
REITs are regulated by the government of their
originating country and to comply with these set
rules many times they have to sacrifice a higher
profit. Privately run REITs, however, are not
regulated by any special government body, and
thus are able to maximize their profit potential
and take bold decisions to help them borne higher
returns by taking rather riskier financial
decisions. If you are investing in a REIT for the
first time, do it via a broker, though you would
be required to pay a brokerage fee, you would
find it immensely helpful as they would assist
you with the selection and documentation process
of the same.    
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4)They either have above the average quality or
quantity   The best performing reit investing
either have a lot of money-making properties in
various domains like commercial, residential,
etc. or have a few luxury real estates that bring
high returns to compensate for the lack of
quantity. The type of tenants REITs deal with on
a regular basis is also important and the best
ones only choose to work with quality tenants.
  We hope you found this article useful in
identifying the common features of good private
REITs regardless of the strategy they choose to
work with.
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