What is the primary function of the Board of Directors in a REIT?

The primary function of the Board of Directors in a Real Estate Investment Trust (REIT) is to govern the REIT and set its strategic direction. This involves making high-level decisions regarding the trust’s operations, policies, and financial strategies, which are essential for ensuring the long-term success and sustainability of the organization.

The Board oversees major decisions and has a fiduciary responsibility to act in the best interests of the shareholders. This includes approving budgets, delineating the REIT's investment policy, and guiding the portfolio's management to align with the objectives laid out in the REIT's charter. Moreover, the Board ensures compliance with legal and regulatory requirements, as well as corporate governance standards, which are vital for maintaining investor trust and company integrity.

While property maintenance, tenant relations, and conducting market research are important functions within a REIT, these tasks are typically handled by management teams and specific departments. The Board's focus is broader, centering on overarching governance and strategy rather than on these operational details.