Reits fund refers to real estate trust and investment fund, which is an important means of real estate securitization. Reits funds are managed by specialized agencies, and the investment targets include large commercial properties with stable income, including shopping malls, office buildings and houses in core areas.
Extended data
Real estate investment trust funds (REITs) are an important means of real estate securitization, which originated in the United States and first appeared in 1962.
It is clearly defined as a closed-end investment fund that holds real estate, mortgage-related assets or both. It is intended to let small and medium-sized investors participate in the real estate market with a lower threshold and obtain the benefits brought by real estate market transactions, rents and appreciation.
With the US government officially allowing qualified REITs to be exempted from income tax and capital gains tax, REITs have become the most important financial instrument in the United States. There are about 300 real estate investment trusts in operation in the United States, with total assets under management exceeding $300 billion, of which nearly two thirds are listed and traded on national stock exchanges.
In 2003, REITs began to operate in the Hong Kong real estate market, and its funds were managed externally.
In June 2005, Hong Kong promulgated new regulations, allowing real estate investment trusts to invest in overseas real estate, and allowing loans not to exceed 45% of the value of real estate held. The establishment of REITs in the United States is mainly determined by the securities investment law and related tax laws. REITs, like other financial products, must abide by the Securities Investment Act of the United States 1933 and the relevant laws of various states. The tax law stipulates some main conditions for REITs to enjoy tax benefits, which explains why the development of REITs in the United States revolves around the changes in the tax law.