Frequently Asked Questions

  • What is a REIT?

    REITs, or Real Estate Investment Trusts, were created by Congress in 1960 to allow average investors the opportunity to invest in large-scale, income producing real estate. To qualify as a REIT and enjoy preferential tax treatment from the IRS, a REIT must annually distribute at least 90% of its taxable income in dividends to its shareholders. In other words, REITs pass through most of their income directly to shareholders, and in turn pay no taxes on this income at the REIT level. In the same way shareholders benefit by owning stocks of other corporations, shareholders of REITs earn a pro-rata share of the income produced through ownership of real estate.

    A REIT is a company that owns and operates income producing real estate such as office buildings, apartments, shopping centers, hotels and warehouses. Many of these REITs are public companies and traded on national stock exchanges (NYSE, AMEX, NASDAQ), while others are not publicly listed and are referred to as non-traded public REITs.

  • What is Original Share Price?

    Original share price is the original issuance price of non-traded public REIT shares.

  • What is Book Value?

    Book value is the most recently published total shareholders' equity divided by shares outstanding.

  • What are Recent Secondary Market Trading Prices?

    Recent secondary market trading prices show the price per share and total purchase price paid for past non-traded public REIT auctions conducted through REITbid.

  • What is Net Asset Value (NAV)?

    Many non-traded public REIT managers publish an estimated net asset value (NAV) per share. To make this calculation, REIT managers rely in part on an estimate of the fair market value of the REIT's real estate investments, then adjust to give effect to other REIT assets and liabilities, including mortgages. The resultant valuation is then divided by the number of shares outstanding to arrive at a NAV per share.

  • What are Historic Dividends?

    Historic dividends are the recent amounts paid by a non-traded public REIT to its shareholders. Dividends are typically distributed quarterly and are subject to adjustment at each distribution period.

  • What are Funds From Operation (FFO)?

    FFO is a financial calculation that is widely recognized in the REIT industry as a measure of operating performance, or cash flow. FFO is defined by the National Association of Real Estate Investment Trusts (NAREIT) as net income (loss) computed in accordance with GAAP, excluding gains or losses from sales of property, plus depreciation and amortization on real estate assets, and after adjustments for unconsolidated partnerships and joint ventures. FFO was developed by NAREIT as a measure of performance to recognize that income-producing real estate has historically not depreciated consistent with the basis as determined under GAAP.

  • Do I have to pay any fees for purchasing shares?

    Yes. In addition to the total bid amount, which is the winning bid amount multiplied by total number of shares in the auction, the buyer is responsible for additional fees outlined in the Terms and Conditions of Sale. Terms and Conditions are available in the Documents section on each auction page.

  • Can I bid on a portion of shares in a REIT auction?

    No. Each REIT share auction is for all shares listed under the Number of Shares.

  • Can I bid on multiple auctions at one time?

    Yes, but you are still responsible for completing all transactions for every auction where you are the winning bidder.

  • How will I know if someone else placed a higher bid than me? How can I monitor bidding activity?

    If you are a bidder in an auction, you will be notified via email each time a new bid is placed. If you are not a bidder but would like to monitor bidding activity, you can add the auction to your Watch List and you will be notified via email each time a bid is placed.

  • What happens after I become the winning bidder?

    A REITbid representative will contact you via email informing you that you are the winning bidder. At that time, transfer documents will be routed to you for signature along with instructions on where to send documentation and wire purchase funds. Once fully executed documents and funds are received, transfer documents are forwarded to the REIT sponsor to process the transfer. Additional details are outlined in the Terms and Conditions located in the Documents section of each auction.

  • How do I pay for my REIT shares if I am the winning bidder?

    Shares are purchased via wire transfer or check and are sent to the clearing agent processing your transaction. Please refer to the Terms and Conditions in the Documents section on each auction page for additional details.

  • What is REITbid?

    REITbid was created to match buyers and sellers of non-traded public REIT shares in a format that is simple and effective. REITbid utilizes an advanced auction platform powered by FRE.com. This platform allows buyers and sellers the convenience and transparency of online bidding, and access to information on non-traded REITs to assist informed decision making.

  • Who started REITbid?

    REITbid was created by a team of veteran real estate professionals with extensive experience in securities, real estate investment management, sales and real estate auctions.

    Click here to learn about our Executive Team.

  • What is FRE.com?

    FRE.com is where REITbid's non-traded public REIT auctions take place. REITbid and FRE.com partnered in 2011 to create an efficient auction marketplace for buyers and sellers of non-traded public REIT shares.

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