New Delhi, Aug. 3 -- Real Estate Investment Trusts (REITs) allow investors to own a small stake in income-generating commercial properties such as office parks, malls, warehouses, and hotels without directly buying real estate. On the other hand, REIT mutual funds provide exposure to REITs and real estate stocks through a professionally managed portfolio.

While both provide access to the real estate sector, they differ in returns, taxation, and suitability. Vaibhav Porwal, Co-founder of Dezerv, explains their structure and the key differences.

A REIT is a listed investment vehicle that owns and manages income-generating commercial properties and distributes rental income to investors. SEBI requires a REIT to distribute at least 90% of i...