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 2020 alone, the industry contributed 2.9 million full-time jobs to the US economy generating $197 billion of labor income. As you can see, the industry is booming with job opportunities you can take advantage of.
In this blog, I’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 1m households in the United States and owning approximately 535,000 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.
- 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).
- 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.
- 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:
- 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.
- 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.
- 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:
- 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.)
- 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.
- Hospitality REITs 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.
- Residential REITs 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.
- Healthcare REITs 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.
- Diversified REITs 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 2021, the Bureau of Labour Statistics revealed that over 562,100 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 $51,220 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.
3. Property Development Manager
Property developments in REIT departments are an excellent way to profit. Property development managers are in charge of all types of development projects. They are primarily involved in the design and construction of a new property.
Working as a real estate developer is another way to profit from this expanding industry. The property developers handle all design and construction documents, and they collaborate to inspect the building’s property.
4. Acquisition Roles
Acquirers identify and evaluate potential acquisition targets, negotiate and structure transactions, and lead due diligence efforts.
Furthermore, these positions in real estate investment pay well, with an annual salary of $80,000. To secure a job in this position, you must possess a degree in finance, marketing, business, or capital markets.
It’s also essential for you to possess strong analytical skills, real estate industry experience, and the ability to think creatively to solve problems and introduce new investing opportunities.
5. REITs Analyst
As a REIT analyst, your primary responsibility would be to conduct research on REITs and make recommendations to investors. To succeed in this role, you must thoroughly understand the REIT industry. You must also analyze the factors that influence REIT performance.
As the job market tightens, REIT analyst jobs are becoming increasingly popular and challenging to find. Despite the competition, REIT analyst jobs remain among the most sought-after in the industry.
Other REIT job opportunities include real estate property appraiser, leasing consultant, sales supervisor, or relations consultant. Now that you know REITs’ jobs, let’s consider some benefits.
Best Paying Jobs In Real Estate Investment Trust
The best jobs in real estate investment trusts earn between $150K – $270K.
Let’s take a look at the top 3:-
1. Vice President Of Asset Management
The VP of asset management is responsible for the financial performance of a portfolio. They’re in charge of finding investors, overseeing returns, and marketing. It’s one of the best-paying jobs in REITs, and these people earn as much as $261,100 annually.
2. Mortgage Loan Officer
The mortgage loan officer is in charge of helping clients get the perfect loan type and mortgage. In the United States, a mortgage loan officer can earn up to $ 215,749 per year.
3. Real Estate Attorney
A real estate attorney oversees the legal aspect of a property transaction. They prepare and review legal documents related to property sales and transactions. They earn as much as $156,682 annually.
Other best-paying jobs in REITs include
- Investor relations
- Real estate developer
- REIT Analyst
- Real estate agent
- Property manager
- Real estate broker
- Property accountant
- Real estate property appraiser
How To Become A Real Estate Investment Trust Professional?
Becoming a professional in REIT is a challenging feat. Because REITs must follow certain rules and regulations, entering the industry might take a lot of work. However, you can kickstart your journey into this industry with the right information. Below are some things you need to know before kickstarting your career.
Have a passion for the industry
REITs are about generating income from real estate holdings, so if something else interests you, a career in REIT may not be for you. But if you’re excited about investing in real estate, it’s an excellent sign to chase your dreams.
Stay informed
Pay close attention to housing market predictions and keep up with all recent developments in real estate investing news.
Study the burgeoning neighbourhoods, the properties that are up for sale, and those that aren’t selling if you’re investing in residential real estate. Pay attention to what, where, and when tenants are renting. You should always be able to identify opportunities when they come.
Decide on the area to specialize in
There are different types of real estate investment trusts. Knowing which area to specialize in helps you choose the right career path. The different types of REITs include
- Retail Real Estate Investment Trusts
- Residential Real Estate Investment Trusts
- Healthcare Real Estate Investment Trusts
- Office Real Estate Investment Trusts
- Mortgage Real Estate Investment Trusts
- Hybrid Real Estate Investment Trusts
- Publicly Traded Real Estate Investment Trusts
- Public Non-Traded Real Estate Investment Trusts
- Private Real Estate Investment Trusts
There are many things to consider when choosing to become a real estate professional. The most important thing is deciding if it’s the perfect career path.
