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Equity REITs
Equity REITs
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Equity REITs invest in companies that purchase, build, renovate, manage, and sell income-generating real estate. The company's revenues primarily come from rents paid by tenants.
TauLayer can offer tokenized access to REIT-style equity products, giving users exposure to income-generating property portfolios with the flexibility of blockchain.
You can tokenize:
- Units of a private REIT or property fund
- Equity shares in a pool of professionally managed buildings
- Smart contracts that auto-distribute rental yield in stablecoins
What is an Equity REIT?
An Equity REIT is a type of real estate investment trust that owns and operates income-producing real estate. Investors purchase shares in the REIT, and in return, they receive a portion of the rental income generated by the properties the REIT manages.
Unlike mortgage REITs (which invest in real estate debt), Equity REITs invest in real estate equity — they own the physical assets.
How Equity REITs Work
- The REIT raises capital by issuing shares to investors.
- It uses that capital to buy or develop properties (e.g. apartments, shopping centers, offices).
- It collects rent from tenants and pays at least 90% of taxable income as dividends to shareholders (to maintain REIT tax status).
- Shares are often publicly traded — making REITs relatively liquid compared to direct real estate.
Key Features
| Feature | Equity REITs |
|---|---|
| Assets Held | Direct ownership of properties |
| Returns | Rent income + long-term appreciation |
| Liquidity | High (public REITs); lower for private/non-traded |
| Dividends | Yes — typically paid quarterly |
| Leverage | Often moderate (to enhance returns) |
| Management | Internal (self-managed) or external |
| Tax Treatment | Must distribute 90%+ of taxable income to avoid corporate tax |
| Investor Access | Publicly traded REITs are retail-accessible; private REITs require accreditation or tokenization |
Common Types of Equity REITs
- Residential – apartments, student housing, manufactured homes
- Retail – malls, shopping centers, outlet stores
- Office – urban towers, suburban campuses
- Industrial – warehouses, logistics, cold storage
- Healthcare – hospitals, senior housing, medical offices
- Hospitality – hotels, resorts (higher risk/reward)
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Specialty – data centers, cell towers, self-storage
Why Equity REITs Appeal to Investors
✓ Steady Income – Rents = recurring dividends
✓ Diversification – Uncorrelated to stocks/bonds
✓ Inflation Hedge – Real estate income tends to rise with inflation
✓ Professional Management – No need to manage properties
✓ Low Barrier to Entry – Especially when tokenized or fractionalized
Equity REITs vs. Tokenized Real Estate
| Feature | Traditional Equity REIT | Tokenized Real Estate via TauLayer |
|---|---|---|
| Liquidity | High (if public) | Medium–High (via smart contracts) |
| Minimum Investment | Low (public REITs), High (private) | Very low (fractional tokens) |
| Transparency | Moderate | High (on-chain reporting) |
| Global Access | Limited | Borderless via crypto wallets |
| Customization | None | Yes (by geography, yield, duration) |
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