A REIT is a legal entity that owns real estate and/or real estate mortgages. Your investment decision should not be based on the fact that it’s a REIT. There are equity REITs and mortgage REITs. They specialize in every type of real estate. Some examples are industrial, office, mixed, shopping centers, regional malls, apartments, manufactured housing, lodging, healthcare, commercial loans and residential loans.

Either through your own initiative, or with a financial advisor, select the real estate type that appears to be best positioned in the economy. That means: Where is the real estate? Is it diversified? How much leverage is being used? Does the risk being assumed by the REIT match your own investment goals?

Next, examine the track record. Past success is not necessarily a guarantee of future success. At the same time, if the same management team is in place, and the results weren’t a one-time fluke, then there’s a strong probability there will be success in the future.