Why REITs in the Philippines are the best investment choice for beginners

Neil Gregori Garen

Jan 30

Why REITs in the Philippines are the best Investment choice for beginners

Are you new to investing and looking for a way to grow your money in the stock market? Do you want to invest in real estate without the risk of putting a large sum into a business venture?

Investing in real estate doesn’t always mean buying a condo or a house. Thanks to Real Estate Investment Trusts or REITs, Filipinos can invest in income-generating properties with minimal capital. The framework of REIT in the Philippines was established through the REIT Act of 2009 or the Republic Act 9856, but it wasn't until 2020 that the first REIT, AREIT by Ayala Land, was launched. Since then, major property developers like Villar’s Vista REIT (VREIT) and Gokongwei’s Robinsons Commercial REIT (RCR) have entered the market, making real estate investing more accessible than ever.

If you're new to investing, here’s why REITs are a great place to start:

Steady passive income through dividends

One advantage of REITs is their regular quarterly dividend payouts, unlike other stocks that typically pay once a year. By law, at least 90% of a REIT’s distributable income must be passed on to investors, while other stocks may distribute up to 60% or decide based on the board of directors. The quarterly payout structure allows you to monitor your investment growth more closely and potentially increase your returns by reinvesting dividends, which can help your investment grow faster over time. Whether you invest in office, retail, or industrial REITs, you can earn income without the need to manage properties yourself.

Diverse investment options in REITs in the Philippines

The Philippine REIT market offers a variety of options depending on your preference.

Office and Retail REITs provide exposure to commercial real estate. AREIT, VREIT, and RCR own malls, offices, and commercial spaces rented out to major businesses, ensuring a steady stream of rental income.

Industrial REITs focus on logistics and energy-related assets. Premiere Island Power REIT (PREIT) and Citicore Energy REIT (CREIT) invest in warehouses, industrial parks, and renewable energy properties, benefiting from the increasing demand for sustainable and large-scale infrastructure.

Affordable investment with low capital requirement

Unlike purchasing a condominium or commercial space, REITs allow you to invest in real estate with just a few thousand pesos. You can start investing through online trading platforms like COL Financial, BPI Trade, DragonFi, or First Metro Sec—making real estate ownership accessible even to small investors.

Liquidity and easy access to funds

Real estate investments are typically illiquid, meaning they take time to sell since you need to find a buyer, process documents, and handle tax filings. However, REITs trade like stocks, allowing investors to buy and sell shares quickly when needed. This flexibility ensures that your money isn't locked into a physical property that could take months or even years to liquidate.

Potential for long-term growth and inflation protection

Real estate values tend to appreciate over time, and since REITs generate income from rental properties, they naturally adjust to inflation. As the Philippine economy continues to grow and businesses expand, demand for office spaces, malls, warehouses, and industrial properties is expected to rise, leading to higher REIT valuations and increasing dividends.

For new investors looking for a safe, affordable, and income-generating investment, REITs offer an excellent opportunity. With different REITs available in the Philippines, you can choose the one that best fits your financial goals—whether it’s commercial properties like VREIT, RCR, and AREIT, or industrial assets like PREIT and CREIT.

Thinking about investing in REITs? Start small, do your research, and enjoy the benefits of real estate investing without the hassle of property management!