Which types of properties might an office REIT invest in?

An office REIT typically focuses on investing in properties that are primarily used for business activities and provide workspace for employees. This includes office buildings, which serve as the main type of asset for office REITs. Business parks, which are collections of office buildings and sometimes industrial spaces, also fall under this category as they often host multiple companies in a campus-like setting. Additionally, coworking spaces have gained popularity and provide flexible workspace solutions, making them relevant investments for office REITs.

The focus on these types of properties allows office REITs to capitalize on rental income generated from long-term leases with businesses, which can lead to stable and predictable cash flows. This is crucial for their investment strategy, as it aligns with the goal of providing returns to investors through dividends and capital appreciation.

In contrast, investments in retail centers, warehouses, residential apartments, hotels, and industrial manufacturing plants fall under different categories of REITs. Retail REITs specialize in shopping malls and retail spaces, while residential REITs focus on rental apartments. Hotels are typically targeted by hospitality REITs, and industrial REITs invest in manufacturing and logistics facilities. Thus, these properties do not meet the criteria for what an office REIT would invest in.