• The Shot You’ll Never Forget Giveaway - Enter To Win A Barrel From Rifle Barrel Blanks!

    Tell us about the best or most memorable shot you’ve ever taken. Contest ends June 13th and remember: subscribe for a better chance of winning!

    Join contest Subscribe

Anyone investing in REIT?

Maggot

Maggot

"For we wrestle not against flesh and blood"
Supporter
Full Member
Minuteman
Supporter
    • Jul 27, 2007
    26,831
    31,967
    Virginia
    #1
    Real Estate Investment Trust.

    It looks like a way to get a good return with low risk factor especially since managing rental property has become a pariah.

    Ive read EQIX is a good one.

    Opinions and actual knowledge appreciated.
     
    #4
    I've made a ton of money in my REITs. Reinvest your dividends. You will find most REITs will be investing in planned rental communities. Entire blocks of homes built to be rental properties for the owner of the community. I'd say that 80% of my investments are going into these types of communities.

    I don't share any of my personal information, so I can't tell you which funds I have, but they do not include the one you mentioned.
     
    • Like
    Reactions: BLEE
    #6
    BullGear said:
    I've made a ton of money in my REITs. Reinvest your dividends. You will find most REITs will be investing in planned rental communities. Entire blocks of homes built to be rental properties for the owner of the community. I'd say that 80% of my investments are going into these types of communities.

    I don't share any of my personal information, so I can't tell you which funds I have, but they do not include the one you mentioned.
    Click to expand...
    Define a “ton” in terms of percentage per year.

    I know a few individuals that have made a lot of money in REITs but they were all General Partners versus Limited Partners.

    I have a feeling that you are discussing EFTs that focus on real estate versus traditional REITs which are not traded on the exchanges.

    I invested in one REIT a long time ago that focused on low income housing construction and it generated 20% of your investment per year in the form of tax credits. Not tax deductions but dollar for dollar credits. If you actively owned real estate, you could deduct the credits from your tax liability. That was a great investment as I owned a bunch of rental properties at the time.
     
    #7
    Nik H said:
    Define a “ton” in terms of percentage per year.

    I know a few individuals that have made a lot of money in REITs but they were all General Partners versus Limited Partners.

    I have a feeling that you are discussing EFTs that focus on real estate versus traditional REITs which are not traded on the exchanges.

    I invested in one REIT a long time ago that focused on low income housing construction and it generated 20% of your investment per year in the form of tax credits. Not tax deductions but dollar for dollar credits. If you actively owned real estate, you could deduct the credits from your tax liability. That was a great investment as I owned a bunch of rental properties at the time.
    Click to expand...

    Last year I averaged 14.4%. No, I know what a REIT is and I assure you I invest in REITs.
     
    • Like
    • Wow
    Reactions: MarshallDodge, Nik H and Maggot
    #8
    As luck would have it, I got a notification of a new investment.

    BullGear — We’re pleased to announce the latest addition to your XXXXXX portfolio: single-family rental homes in Tucson, AZ. This investment fits into our broader strategy to invest in affordably-priced apartments across the Sunbelt — an asset class that has demonstrated stability through the pandemic while being positioned for outsized growth in the coming years.
     
    • Like
    Reactions: Doc68 and Maggot
    #9
    BullGear said:
    Last year I averaged 14.4%. No, I know what a REIT is and I assure you I invest in REITs.
    Click to expand...
    Can’t complain about that return.

    I am glad that they are working for you. I know a few that got burned in 2008 timeframe, especially with REITs that were focusing on the growth in CA. Even a couple that saw it coming couldn’t get out due to the liquidity issues with that REIT. Liquidity was always a problem for me. Don’t know if that has changed
     
    #10
    Nik H said:
    Can’t complain about that return.

    I am glad that they are working for you. I know a few that got burned in 2008 timeframe, especially with REITs that were focusing on the growth in CA. Even a couple that saw it coming couldn’t get out due to the liquidity issues with that REIT. Liquidity was always a problem for me. Don’t know if that has changed
    Click to expand...

    No, it can still be a problem. You have to petition for a withdrawal, it's up to them if they allow it. Usually they have a percentage that they allow to get out. If you're out of that time table, you can't get out at that time.
     
    • Like
    Reactions: Nik H
    #11
    BullGear said:
    No, it can still be a problem. You have to petition for a withdrawal, it's up to them if they allow it. Usually they have a percentage that they allow to get out. If you're out of that time table, you can't get out at that time.
    Click to expand...
    Is that so in a publicly traded REIT? I thought those were just like stocks, you buy and sellat your discretion.
     
    #14
    If you know this going into the investment, it's not a surprise. In 4-5 years, I've gotten a 70% growth on my investment. This is a marathon, not a sprint type of an investment.

    If this isn't for you don't do it.
     
    #16
    There are many kinds of REITs specializing in almost all aspects of real estate: strip malls, professional offices, hospitals, skilled nursing facilities, data storage, cell towers, storage units, hotels, farmland, timberland, industrial space, government offices, billboards, and the list goes on and on. Many are traded on the major stock exchanges. To be a REIT, you have to pay out most of your income to your owners which creates some tax savings (as well as potential problems). They generally have favorable dividend yields making them attractive to retirees. Yes, the REIT market got slammed in the 2008 time frame as did a lot of industries, but if you hung on, most REITs soared to new highs. REITs aren't for everyone, but they do belong in most people's portfolios in my opinion. Most of my REITs have done very well, but I had some dogs too.
     
    #17
    REITs in general are more highly leveraged, regardless of what type of property they are investing in. The leverage in needed, because as you said, they have to pay out most of their income to investors meaning they have to borrow funds to expand their property portfolio. The upfront cost of purchasing a strip mall, or a collection of self storage properties is high. It's the nature of the business model.

    I'm not trying to discourage anyone from investing in REITs. I agree that having a few in your portfolio is a good idea. What I was trying to express in simple terms is that REITs carry an added risk factor during periods of rising interest rates and falling property values.

    As for 2008. Any company that made it through the GFC eventually soared to new all time highs. For REITs it took 8 years.
     
    #21
    Make sure it's public so you have liquidity and invest with sponsors who have a real track record through multiple business cycles. Keep an eye on fees. Up front, over term and disposition fees (if any).

    Real estate is a good way to hedge inflation as long as you are in sectors that have shorter lease duration. Multifamily and self storage would be top of my list. Student housing and senior living have some unknowns that can be mitigated by investing with groups that have a great track record and lots of relevant experience.

    Office, NNN, and medical office typically have leases that have fixed rental escalators. In these asset classes you are trading certainty of payments (tenant credit) for potential upside (fixed lease payments).

    The item to look at for a public REIT is what their share redemption program is like. For example, they may have a share redemption program for up to 5% of outstanding shares per quarter (20% per year). Of course, this works well unless everyone wants out at the same time
     
    #22
    Another new investment along the same lines as most of them over the last 24 months. That's 2 new investments in the last 24 hours.

    BullGear — We’re pleased to announce the latest addition to your XXXXX portfolio: a single-family rental home community in Myrtle Beach, SC, along the Atlantic coast. This investment fits into our broader strategy to invest in affordably-priced apartments across the Sunbelt — an asset class that has demonstrated stability through the pandemic while being positioned for outsized growth in the coming years.
     
    #23
    A retirement community is the latest for my REIT.

    An update on your XXXXX portfolio: We’ve provided a loan for the acquisition of roughly 11 acres in the Bay Area, as the future site of a 376-unit rental community. While the borrower completes architectural designs and secures construction permits, we are entitled to earn an annualized return on our investment equal to 8.5%.
     
    #24
    We hit a home run with this one.

    BullGear — In November 2016, we invested in the Enclave at Lake Ellenor, a 296-unit apartment community in Orlando, FL, as part of your XXXXX portfolio. Today, we’re pleased to report that the sponsor has successfully sold the property and paid back our investment, resulting in an annualized return of roughly 36.7%.
     
    #28
    Seems the threat of inflation isn't stopping them....

    BullGear — We’re pleased to announce the latest addition to your XXXXX portfolio: a single-family rental home community in Jacksonville, FL. This investment fits into our broader strategy to invest in affordably-priced apartments across the Sunbelt — an asset class that has demonstrated stability through the pandemic while being positioned for outsized growth in the coming years.
     
    #30
    Just a quick article from Cramer about the positions of certain REITs.

    www.yahoo.com

    Jim Cramer's REIT Picks From Earlier This Year Reveal Alarming Truth

    Jim Cramer is a lightning rod when it comes to scrutiny. On one hand, giving investing advice every day on air for years is naturally going to produce some losing picks. However, Cramer has become the focal point of a lot of targeted opposition. For instance, you can check out his ongoing...
    www.yahoo.com www.yahoo.com

    Take it for what it's worth.
     
    #32
    A REIT is a particular tax structure. It can be used for numbers types and structures of real estate investment. The two most common for retail investors are internally managed public reits and externally managed private reits. The public ones, for example NYSE: AVB, tend to be very low leverage (less than 20% ltv and less than 6:1 debt to ebita). They tend to do only one product type. They tend to be very efficient ways of owning that product type with no external fees and low internal G&A load (under 30bps). Their stock is a public security and you can trade just like anything else. Most of it is owned by large institutional investors who hold for the long term.

    The large private reits (bx's b-reit for example) tend to be highly levered (60% ltv or higher), and typically have high fees paid to the external manager of the REIT. The stock is privately traded with limited liquidity. Most is held by private retail investors who work with RIAs.
     
    #33
    Maggot said:
    Real Estate Investment Trust.

    It looks like a way to get a good return with low risk factor especially since managing rental property has become a pariah.

    Ive read EQIX is a good one.

    Opinions and actual knowledge appreciated.
    Click to expand...

    Nik H said:
    Can’t complain about that return.

    I am glad that they are working for you. I know a few that got burned in 2008 timeframe, especially with REITs that were focusing on the growth in CA. Even a couple that saw it coming couldn’t get out due to the liquidity issues with that REIT. Liquidity was always a problem for me. Don’t know if that has changed
    Click to expand...
    Not all REITs are created equal.
     
    • Like
    Reactions: RUTGERS95 and BullGear
    #37
    Maggot said:
    And from what I see most all of them are down considerably.
    Click to expand...

    Not true, some are still above water. I have 1 that is a little bit more than 6% and another that is at about 4%. There are still some who are showing returns that were generated during the good time. I don't know what their most recent activity is doing. I will look much closer in about 6 months to a year from now. I'm going to ride any investment that's producing positive returns at this time.

    The one thing that is interesting, both of my REITs are investing in RENTAL COMMUNITES. Whole communities are being built for the one and only purpose of individual homes for lease. I know of property owners who are being paid much more than 100% of the property's value. Even if just to build 4 homes on said property. These homes are being built for rental income.

    I find this extremely interesting.
     
    #38
    BullGear said:
    Not true, some are still above water. I have 1 that is a little bit more than 6% and another that is at about 4%. There are still some who are showing returns that were generated during the good time. I don't know what their most recent activity is doing. I will look much closer in about 6 months to a year from now. I'm going to ride any investment that's producing positive returns at this time.

    The one thing that is interesting, both of my REITs are investing in RENTAL COMMUNITES. Whole communities are being built for the one and only purpose of individual homes for lease. I know of property owners who are being paid much more than 100% of the property's value. Even if just to build 4 homes on said property. These homes are being built for rental income.

    I find this extremely interesting.
    Click to expand...
    That is interesting. Quarters for the serfs? Is that by Blackrock?

    What I meant was that most are down (you said you had been getting +/- 14%). Many are in the negative.
     
    • Like
    Reactions: SilentStalkr
    #39
    Maggot said:
    That is interesting. Quarters for the serfs? Is that by Blackrock?

    What I meant was that most are down (you said you had been getting +/- 14%). Many are in the negative.
    Click to expand...

    I believe the reason is that more than 90% of their investments are in Rental Communities. I mean we are talking well over 90k houses built in communities for the express reason that they believe housing sales will not be affordable for the majority of society in the future. Scary!
     
    • Like
    Reactions: Maggot
    #40
    BullGear said:
    I believe the reason is that more than 90% of their investments are in Rental Communities. I mean we are talking well over 90k houses built in communities for the express reason that they believe housing sales will not be affordable for the majority of society in the future. Scary!
    Click to expand...
    "You will own nothing and like it".

    And even if you dont like it, you'll have no choice, because we own the means of production. Where have I heard that before?:unsure:
     
    • Like
    Reactions: SilentStalkr and BullGear
    #47
    Got an interesting notification from my broker for one of my REITs.

    BullGear — We’re pleased to announce the latest addition to your Xxxxxxx portfolio: an approximately 302 acre property in Myrtle Beach, SC as the future site of a new community of 251 single-family rental homes.
    This investment follows a Fixed Income real estate strategy, with an innovative structure: We’ve engaged a home builder to develop the land into finished lots. The builder will then have the rights to purchase the lots from us at a set price. In exchange for those rights, they have agreed to pay us a fixed monthly rate, similar to an interest payment.
     
    • Like
    Reactions: RUTGERS95
    #48
    BullGear said:
    Got an interesting notification from my broker for one of my REITs.

    BullGear — We’re pleased to announce the latest addition to your Xxxxxxx portfolio: an approximately 302 acre property in Myrtle Beach, SC as the future site of a new community of 251 single-family rental homes.
    This investment follows a Fixed Income real estate strategy, with an innovative structure: We’ve engaged a home builder to develop the land into finished lots. The builder will then have the rights to purchase the lots from us at a set price. In exchange for those rights, they have agreed to pay us a fixed monthly rate, similar to an interest payment.
    Click to expand...
    pm me details please
     
    • Like
    Reactions: SilentStalkr
    You must log in or register to reply here.

    Similar threads

    gr8fuldoug
    Maggie’s New Winners - Next Drawing is Oct 2nd
    Replies
    0
    Views
    171
    gr8fuldoug
    gr8fuldoug
    T
    Building my first M40 for the Vintage Sniper matches.
    Replies
    13
    Views
    822
    deltawiskey
    deltawiskey
    D
    White Hat Mentality
    Replies
    0
    Views
    356
    DocRDS
    D
    PatMiles
    One in Four Gen Z Job Applicants Bring Parents to Interview.
    Replies
    35
    Views
    2K
    John Barleycorn
    John Barleycorn
    tea&jam
    Property trust for the poors
    Replies
    12
    Views
    930
    n2ishun
    n2ishun
    Top Bottom
    Back
    Home
    Forums
    Merch
    Alerts