Finite-Life REIT - FREIT

DEFINITION of 'Finite-Life REIT - FREIT'

A real estate investment trust (REIT) that aims to sell its real estate holdings within a specified time frame so as to realize capital gains on its properties. Because of the definite date of their liquidation, finite-life REITs may be more liquid and trade closer to their net asset values than conventional REITs.

BREAKING DOWN 'Finite-Life REIT - FREIT'

Finite-life REITs were introduced in the U.S. in the 1980s as an extension of REITS. FREITs are criticized for their inability to exploit a proper buy and hold strategy in terms of their underlying assets, which can result in poor performance compared to their generic counterparts.

RELATED TERMS
  1. Real Estate Investment Trust - ...

    A REIT is a type of security that invests in real estate through ...
  2. REIT ETF

    Exchange-traded funds that invest the majority of assets in equity ...
  3. Funds Available For Distribution ...

    An informal measure of the amount of capital that is on hand ...
  4. Captive Real Estate Investment ...

    A real estate investment trust (REIT) that is controlled by a ...
  5. Funds From Operations Per Share ...

    A metric for the performance of a real estate investment trust ...
  6. Non-Traded REIT

    A form of real estate investment method that is designed to reduce ...
Related Articles
  1. ETFs & Mutual Funds

    REITs vs. REIT ETFs: How They Compare

    Learn about the difference in investing in a REIT for a single real estate company versus investing in a REIT ETF that tracks a larger REIT index.
  2. Investing

    REITs: Why They're So Hot Right Now

    They've been substantially outperforming both stocks and bonds for the past several months.
  3. Financial Advisor

    REITs: Still a Viable Investment?

    Are REITs viable investments now? Here's a look at the history of REITs' performance during rocky economic times and other factors that may impact returns.
  4. Investing

    Are REITs Beneficial During A High-Interest Era?

    Amid expectations of high interest rates, do REITs offer a viable investment option? Investoepdia studies the historical data to decide.
  5. ETFs & Mutual Funds

    What Is a REIT and Does It Belong in My Portfolio?

    Real estate investment trusts offer a unique way for investors to own a real estate portfolio without the risks of owning single properties.
  6. Managing Wealth

    REITs 101: How They're Regulated

    Here's everything you need to know about REITs in less than five minutes.
  7. Markets

    REITs Could be Affected by Higher Interest Rates

    Learn how REITs may be impacted by an increase in interest rates, and understand why certain types of REITs could benefit from higher rates.
  8. ETFs & Mutual Funds

    At Look at REITS vs. Real Estate Mutual Funds (ESRT, TRREX)

    REITs and real estate mutual funds have their differences, but they both offer liquidity and easy access to diversified real estate assets.
  9. Managing Wealth

    The Basics of Reinvesting REIT Dividends

    Learn the essentials of dividend reinvestment in real estate investment trusts and how a dividend reinvestment plan can magnify your long-term returns.
  10. ETFs & Mutual Funds

    3 Cheap REIT ETFs That Stand Out (SCHH, FREL)

    Discover three low-cost exchange-traded funds that hold stocks of real estate investment trusts (REITs) and provide unique perspectives on the REIT industry.
RELATED FAQS
  1. What is the difference between a REIT and a real estate fund?

  2. What are the pros and cons of owning an equity REIT versus a mortgage REIT? (AEC, ...

    Learn about investing in equity, mortgage and hybrid REITs. Explore the different strategies REITs employ to generate income ... Read Answer >>
  3. What is the difference between an Equity REIT and a Mortgage REIT?

    Find out more about real estate investment trusts and the main differences between equity and mortgage real estate investment ... Read Answer >>
  4. What are the potential pitfalls of owning REITs?

    Learn about pitfalls to investing in REITs, such as investors having to pay income tax, the REIT having to pay property tax ... Read Answer >>
  5. Is NAV the best way to assess the value of an REIT?

    Examine and understand the usefulness of net asset value as an accurate metric with which to assess the value of a REIT investment. Read Answer >>
  6. Can mutual funds invest in REITs?

    Learn about mutual funds that invest in real estate investment trusts and have their shares traded on major U.S. stock exchanges ... Read Answer >>
Hot Definitions
  1. AAA

    The highest possible rating assigned to the bonds of an issuer by credit rating agencies. An issuer that is rated AAA has ...
  2. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  3. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  4. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  5. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  6. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
Trading Center