The National Association of Real Estate Investment Trusts (NAREIT) commissioned advisory and consulting firm EY to examine the economic impact that REITs have on the US economy.

The study examined the full year 2018 and consider the impact of both traded and nontraded REITs. The study found that REIT operations directly employed approximately 276,000 full-time equivalent (FTE) jobs for employees who earned $15.2 billion of labor income in the United States. The total economic contribution of US REITs and related businesses in 2018 was an estimated 2.4 million FTE jobs and $148.2 billion of labor income.

NAREIT Report on the U.S. Economy

The cash generation from REITs also helped improve the wealth and retirement of millions of Americans.

EY found that “REIT activities also resulted in the distribution of an estimated $128.9 billion of dividend income and payment of $60.9 billion of interest income by REITs in 2018. This dividend and interest income supported 521,000

FTE jobs earning $31.0 billion of labor income through the induced contribution of re-spending by REIT bondholders and shareholders. $78.4 billion of these dividends and interest were paid by REITs to the retirement accounts of US residents, where it is available for future consumption spending.”

Real Estate Investment Trusts also benefited the state and local governments in a big way during 2018. Property tax on REIT properties amounted to over $19 billion in 2018. The states that benefitted the most form REIT property tax payments were:

• California ($2.9 billion),
• New York ($2.7 billion),
• Texas ($1.9 billion),
• Florida ($1.3 billion), and,
• Virginia ($0.9 billion).

Consumer sales taxes include the state and local general sales taxes paid on the sales of REIT tenants in the retail industry. Overall, REIT tenants are estimated to have supported $47.6 billion in state and local consumer sales taxes in 2018.

You can download a copy of the full report here.

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