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Question
What is the primary difference between an equity REIT and a mortgage REIT (mREIT)?
1
Equity REITs focus on commercial property while mortgage REITs focus exclusively on residential mortgages
2
Equity REITs own and operate physical properties, earning rental income; mortgage REITs invest in mortgages or mortgage-backed securities, earning interest income — making them essentially leveraged bond funds rather than direct property vehicles
3
Equity REITs are listed on stock exchanges while mortgage REITs are sold privately to institutional investors
4
Mortgage REITs are exempt from the 90% distribution requirement that applies to equity REITs
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