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How To Invest in Real Estate Investment Companies & REITS (Real Estate Investment Trusts)

By April 22, 2019 October 21st, 2019 No Comments

Being a shareholder of real estate investment firms & property investment companies



In Canada, they trade on the TSX (Toronto Stock Exchange).

Now, there’s also some private REITs which don’t trade on an exchange, and these REITs are usually structured as a limited partnership.

Full article on What are Alternative Asset Classes:


Generally, real estate is less correlated to the stock market’s performance. It can provide   tax efficient income and it can appreciate over time. So, it’s something that I think most people would agree that they want to own.



The REITs were popping up and it was a very novel concept at first. They got a lot of traction and it became very popular quickly.

Now why would someone want to own that asset class?

The main reason that I really like it is the tax efficiency, especially in non-registered accounts.

You get what’s called return of capital, which is classified as nontaxable income. In my vernacular here at the office, we call it ROC. ROC is not taxable, it’s classified as return of capital.



Two things happen at the same time here.


Two, you hope to get some growth over time on the actual value of the building that you bought because you are an owner of real estate.



When you own a REIT, you’re a shareholder in a trust that owns a bunch of different office buildings, apartment buildings or commercial buildings.


You can invest in different REITS: apartment complex, commercial building, office building, industrial infrastructure and the list goes on.

There’s a whole bunch of different categories that exist based on the different needs that people want for investing. REITs provide tax free and tax efficient income. It’s fantastic for non-registered accounts and for corporate accounts as well.

Historically, REITS have shown to be uncorrelated to the performance of the stock market and have proven to be wonders for long-term growth and long-term stability of a portfolio.



It makes sense for a lot of people. It could make sense for you if you believe in real estate or if you’re the type that always wanted to own an apartment block by yourself


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