A corporation that holds and manages income-producing real estate assets is called a real estate investment trust(REIT). The purpose of REITs is to give investors an opportunity to participate in a diverse portfolio of real estate assets while simultaneously enjoying the benefits of publicly traded stocks.

REITs typically own and manage a variety of real estate properties, including apartment buildings, shopping centers, office buildings, and industrial warehouses. They generate revenue by leasing these properties to tenants, and the rental income is then distributed to investors in the form of dividends. In addition, some REITs also invest in mortgage loans or other real estate-related securities.

One of the major benefits of investing in a REIT is that it offers a level of diversification that is difficult to achieve with individual real estate investments. REITs typically invest in multiple properties across different geographic locations and property types, which helps to mitigate the risks associated with any single property or market. This diversification can also provide more consistent and dependable returns over the long term.

Another benefit of REITs is the potential for higher returns compared to other real estate investments. At least 90% of the taxable income earned by REIT must be distributed to its investors in the form of dividends or interest, which provide a steady source of income. Additionally, if the value of the underlying real estate assets rises over time, some REITs may also have the potential for capital appreciation.

A business must satisfy certain requirements specified by the IRS in order to qualify as a REIT. These criteria include provisions related to ownership, income, and asset types. By meeting these requirements, REITs are able to enjoy certain tax benefits, such as the ability to avoid paying corporate income tax on the income they distribute to investors. This tax efficiency can increase the overall returns for investors.

One of the limitations of REITs is by purchasing a share, you are investing in a corporation that owns real estate, not directly investing in the underlying real estate. This means that as an investor, you aren't able to directly capture the myriad of benefits of real estate ownership such as depreciation. Overall, REITs offer investors a unique opportunity to invest in real estate without the challenges and complexities of owning and managing individual properties but at a significant cost.