REITs pay most of their money as dividend back to investors. So how does a REIT buy new property? They can take up more debt/loan, or ask investors to fund the purchase.
This asking investor for money is rights, placements or preferential offering.
REIT will issue new shares, investor subscribe to these new shares with their cash, REIT gets money, buy property.
Rights usually is for public. Placements usually for instituitional aka super rich people only. Preferential offering usually for current shareholders.
REITs pay most of their money as dividend back to investors. So how does a REIT buy new property? They can take up more debt/loan, or ask investors to fund the purchase.
This asking investor for money is rights, placements or preferential offering.
REIT will issue new shares, investor subscribe to these new shares with their cash, REIT gets money, buy property.
Rights usually is for public. Placements usually for instituitional aka super rich people only. Preferential offering usually for current shareholders.