I f you have a passion for real estate, you must have considered kickstarting a REIT career.
You’re reading this blog because you want to know how many jobs are available in real estate investment trusts (also known as REITs).
You made a great choice by being here, so stick around.
A REIT is a company, trust, or corporation that owns and operates income-producing real estate assets.
Interestingly, the job market for this industry is growing exponentially.
In 2022 alone, the industry contributed 3.4 million full-time jobs to the US economy generating $263 billion of labor income.
As you can see, the industry is booming with job opportunities you can take advantage of.
In this blog, we’ll walk you through the various job opportunities available in REITs and how you can secure a job to kickstart your career in real estate.
Before we dive into the discussion properly, let’s go over what REITs are and how they operate.
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What Is A Real Estate Investment Trust?
A REIT is a company, trust, or corporation that owns and operates income-producing real estate assets.
They own several commercial real estates, including offices, apartment buildings, hotels, shopping centers, malls, hospitals, etc.
They are modeled after mutual funds and therefore pull the resources of several investors to purchase a property, making it possible for these individuals to earn dividends on the income generated from that property without having to buy or manage them themselves.
In the third quarter of 2022, research revealed that REITs were responsible for financing 1 million households in the United States and owning approximately 575,000 properties in the US.
They are seen as an essential part of the economy and local communities in the US.
How Do REITs Work?
Unlike other real estate companies, REITs do not buy and develop real estate for resale.
A REIT puts together money from individuals and institutions to purchase real estate.
They then develop the properties and allow individuals to invest in them.
With REITs, individual investors earn a share of whatever income is produced through the properties.
This means you earn from the income generated from the property without having to buy or manage the property yourself!
Most REITs are also traded like stocks making them highly liquid, i.e., easy to buy and sell, unlike physical real estate investments.
According to the Internal Revenue Code, real estate sales, interest, or rents account for 75% of the corporation’s revenue.
Now that you know what a REIT is and how they operate, let’s go over the types of REITs that exist today.
Types Of REITs
Knowing the type of REITs existing will aid your job search.
Based on access, REITs can be broadly grouped into Publicly Traded REITs, Public Non-Traded REITs, and Private REITs.
(1) Publicly Traded REITs:
These REITs are listed on major stock exchanges like the New York stock exchange and can be purchased through a broker.
They are available to the public and tend to be more liquid. They are regulated by the US Securities and Exchange Commission (SEC).
(2) Public Non-Traded REITs:
These REITs are registered with the SEC but do not trade on national securities exchanges.
They are more stable because they are not influenced by market fluctuations but tend to be less liquid.
They are also not freely available to the public.
Given its low liquidity and higher investment minimums, it is advisable to stay away from them as a rookie investor.
(3) Private REITs:
These are exclusive and are only usually available to large financial institutions and accredited investors.
They are not registered with the SEC and don’t trade on national securities exchanges.
By asset type and the way income is earned, they are grouped into three sub-categories:-
(i) Equity REITs:
Most REITs are equity REITs.
They own and manage income-producing commercial real estate like offices, apartment buildings, etc.
Revenue is mostly generated through rental incomes.
(ii) Mortgage REITs:
Mortgage REITs provide financing for real estate by purchasing mortgages or mortgage-backed securities.
Revenue is generated from the interest in their investments.
To further explain, a certain company, XYZ, lends money to a real estate developer to buy and develop a property.
They then generate income from the interest earned on the loans given.
This makes XYZ a mortgage REIT.
(iii) Hybrid REITs:
These REITs combine the strategies and features of both equity and mortgage REITs. i.e., they own properties and also hold mortgages.
By property type, they’re grouped into:-
(a) Office REITs:
They own and manage office real estate, such as office buildings.
Many office REITs focus on a specific region (Los Angeles or New York, for example) or a particular type of tenant (logistic companies, government agencies, or tech startups).
(b) Industrial REITs:
They own and manage industrial facilities such as warehouses, distribution centers, light manufacturing, or cold storage.
These properties are crucial for e-commerce and business operations.
Most industrial REITs focus on a specific industrial property type and region.
(c) Hospitality REITs:
They own hotels, motels, and resorts, usually managed by a third-party hotel brand.
They rent or lease space in these properties to guests on a nightly or weekly basis.
Income is therefore generated from accommodation fees.
One of the downsides of investing in them is that the hospitality industry is seasonal.
For example, summer is usually the most profitable season as people have more use for hotels and resorts.
(d) Residential REITs:
They own and manage different forms of residential real estate, such as apartment buildings, single-family homes, and manufactured homes that they rent out to residents.
Residential REITs also focus on a specific property type and specific geographical markets.
(e) Healthcare REITs:
They own and manage healthcare-related real estates, such as senior living facilities, hospitals, medical office buildings, and nursing facilities.
They lease these properties back to healthcare systems that operate the facilities and earn their income from rent.
(f) Diversified REITs:
They own and manage diversified portfolios or a blend of property types.
For example, they might have a portfolio of office properties, industrial real estate, and hospitality properties.
Some diversified REITs concentrate on particular markets, owning a mix of residential, retail, and office properties in one city, while others are diversified by property type and geography.
Diversified REITs are ideal for investors seeking access to a range of real estate assets.
How Many Jobs Are Available In Real Estate Investment Trusts?
In 2022, the Bureau of Labour Statistics revealed that over 589,800 jobs were available in REITs.
It’s projected to grow even more by 2031.
It’s a booming industry with numerous job opportunities.
Generally, people who work in REITs examine real estate investment opportunities, handle rental properties on behalf of investors, or supervise the development of income-generating real estate.
Property managers, real estate brokers, and sales agents are in high demand in this industry.
Statistics have revealed that the average annual salary in the real estate industry will be $52,030 in 2022, with hundreds of thousands of people employed across the United States.
It’s interesting to know that the average pay in the REIT industry is significantly higher than that of real estate brokers.
The average Real Estate Investment Trust (REIT) analyst earned $108,164 per year as of October 2022, which is more than twice the salary of real estate brokers and sales agents.
If you’re considering switching careers to this industry, now is the right time.
With the above discussion out of the way, let’s go over the types of jobs available in real estate investment trusts.
1. Real Estate Broker
We’ve all heard of real estate brokers skilled at negotiating property sales.
If you’re a pro at negotiating, consider filling in for this real estate investment trust position.
Remember that being a broker is not the same as being an agent.
Brokers must have a license and have passed the standard qualification test.
It’s advised to be a specialist and have a lot of certifications to your name, enabling you to work independently.
You can continue your education to advance your career or set up your own office if you want.
Brokers earn six figures and are well compensated for their skills and techniques.
2. Real Estate Investor
Being a real estate investor is a real estate investment trust job only some people want. It’s tasking yet rewarding.
The responsibilities of real estate investors include purchasing assets and adding value to them before selling them at a higher price.
Isn’t it straightforward? I’m sure it is.
Being a real estate investor has the potential to be the most lucrative career job in this field.
However, it takes time, patience, and skill to make it work.
To do so, you must understand when to buy, where, and when to sell.
