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Reits are investment vehicles that can be used by real estate players to attract private investment, while investors (both retail and institutional) can gain dividends generated from income-producing real estate assets like office buildings, shopping malls etc.
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They are similar to mutual funds which provide opportunity to invest in equity stocks, whereas REITs allow one to invest in income-generating real estate assets.
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In REITs, most of the earnings via sale / rent of such investments are distributed to its shareholders.
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Its purpose is to improve the liquidity position of Real Estate developers and give a secure avenue to investors to invest in long term.
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REITs are only for completed projects not the under-construction projects.
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They are primarily for commercial projects and mainly serve as an alternative investment.