Real estate investment trusts for office properties, or REITs (pronounced rits), are defined as investment companies that finance real estate projects either through mortgages or equity. Most often these office real estate investment trusts invest in commercial properties making profits through mortgages or rent. Office real estate investment trust firms are required to pass on 95% of profits to investors in order to keep other tax breaks, and the potential for profit is very good. Since the largest office property real estate investment trusts most often sell shares, individuals can take advantage of the potentially high profits and quick liquidity with minimal capital.

However, office REITs are not without risks. Real estate investment trusts for office properties are susceptible to the fluctuations of the real estate market or even local downturns. Before you invest in office property investment trusts, answer the following questions:

1. Do you have the capital to make the office real estate properties trust worthwhile?

2. Can you commit to a possible long-term investment of a office REIT company?

3. Will you be able to sustain your investment through unforeseen problems with the office real estate property trust?

Action Steps
The best contacts and resources to help you get it done

Research the office real estate investment company and properties

Research to decrease your risk in real estate investment trusts for office properties. Know where the commercial properties are located and investigate the value of the area.

I recommend: Look for an office real estate investment company that clearly lists specific properties like Federal Realty. The Real Estate Investment Property Analyzer will help you evaluate investment regions.

Be prepared for a long-term investment in an office real estate properties trust

Traditionally, the advantage of office property real estate investment trusts was their rapid liquidity, but because of the down-turn in the real estate market, long-term investing may be advantageous.

I recommend: Bonds On Line has both free tools and a paid service to help analyze office REITs. You can also subscribe to their newsletter to keep on top of changing markets. Consider lower risk REITs that invest in government guaranteed properties like the ones offered at American Capital Agency.

Assess your own financial assets before investing in an office realty investment trust

As with the rest of the real estate industry, even the largest office property real estate investment trusts can be effected by falling markets. As with any investment, only invest what you can afford to lose.

I recommend: REIT.com gives a listing of recommended analysts who specialize in office properties trust. National Association of Real Estate Investment Trusts will link you directly with a large selection of recommended office real estate investment trust firms.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  When there is a real estate market slump, you may find some real deals on office REITs, but research the track records of the office real estate investment trust firms.