What are Commercial / Office REITs?
Updated on 24 Feb 2020
Office REITs are REITs that manage, build, or maintain office buildings, and lease these offices to companies that need space. Learn all about investing in these REITs with our experts.
Commercial / Office REITs are real estate investments trusts that own or finance commercial real estate buildings and office spaces. Most investors think twice before investing in commercial real estate because of the extensive knowledge required to take sound risks and also because of the huge capital requirements.
Investing in Commercial REITs allows them to be directly involved in the commercial real estate business without taking on the big risks. If you prioritise a steady cash flow, then investing in Commercial RETIs is a good option to consider.
Why should you invest in Commercial / Office REITs?
Every investor should know the benefits of investing in Commercial REITs so that making a decision is easy. Here are the top 5 advantages of investing in REITs –
- You can be assured that you will receive a steady income from investing in Commercial REITs as every REIT is legally required to distribute 90% of their taxable income to their shareholders as dividends.
- You have the chance to test out other investing opportunities without bearing all the risk. By having a share in a commercial REIT, you are directly involved in the real estate market.
- You can invest in both types of Commercial REITs – those who offer high risk investing opportunities with high gains and low yield investments with a very low risk. You can make the choice that suits your risk appetite.
- You can easily sell and buy Office REITs as they are traded on public exchanges.
- After investing in Office REITs, you will have very high levels of transparency as the dividend yields depend on the value of the commercial properties.
How to invest in Commercial / Office REITs
Just like any other REIT, there are many ways to invest in commercial REITs. You can purchase individual shares from a share market broker or explore publicly traded Commercial REITs ETFs and mutual funds.
Picking the right investment is not an easy decision, especially if you do not have any knowledge about the commercial real estate industry, which is why you have to rely on financial experts to guide you in the right direction. At Kristal AI, you will find financial advisors that are industry experts. With the help of our artificial intelligence, they can analyse the market trends and calculate the risks for every investment.
Is it the best time to invest in Commercial / Office REITs?
Real estate market is booming right now. While the same cannot be said for residential real estate, it is 100% true for commercial and office real estate. It can be a skyscraper or an office park, specific markets in suburban areas and even central business districts. You can also invest in specific industry firms as well as government agencies.
Even if the recession is on the horizon, REITs are a solid investment. For investors who are looking to start their financial journey, Commercial REITs is a great place to start! Check in with our financial investors to know more about the right type of commercial properties and REITs to invest in that is right for you!
What are the things you need to know before investing in Commercial / Office REITs?
Given below is a list of questions you need to know about the Commercial REIT you are interested in investing.
- What are the vacancy rates?
- What are the economic conditions of the property the commercial REIT invests in?
- How much capital is there with the office REIT for acquisitions?
- What is the unemployment rate?
- What is happening in the economy?
You should contact our financial experts at Kristal AI to know the answers for these questions.
Other facts about Commercial / Office REITs
Here are the 6 top commercial/ office REITs globally –
- Boston Properties, Inc. Boston Properties, Inc.
- Kilroy Realty Corporation. KRC Los Angeles, California
- SL Green Realty Corp. SL Green Realty Corp.
- Alexandria Real Estate Equities, Inc. Alexandria Real Estate Equities, Inc.
- Cousins Properties. CUZ Atlanta, Georgia
- Office Properties Income Trust. OPI Newton, Massachusetts
The materials and data contained herein are for information only and shall in no event be construed as an offer to purchase or sell or the solicitation of an offer to purchase or sell any securities in any jurisdiction. Kristal Advisors does not make any representation, undertaking, warranty or guarantee as to the update, completeness, correctness, reliability or accuracy of the materials and data herein. All opinions, forecasts or estimation expressed herein are subject to change without prior notice. Kristal Advisors and its affiliates accept no liability or responsibility whatsoever for any direct or consequential loss and/or damages arising out of or in relation to any use of opinions, forecasts, materials and data contained herein or otherwise arising in connection therewith.