I'm looking to learn more about real estate investment trusts. How do you set one up? how do you make sure your properties are protected and left to your kids without any penalties? What are the questions I'm forgetting to ask? I realize this is quite a generic question, but I know nothing about them and just learned that it is probably something I should have in place. Any guidance is appreciated!
Assuming you are referring to US properties and laws, you don't necessarily need a trust. A LLC could easily protect and pass on to your heirs.
You certainly do not need a Real Estate Investment Trust (REIT) structure. Those vehicles are designed for large multi-partner funds primarily to raising capital, which it does not sound like is your goal.
You should probably ask yourself if there are specific guidelines or wishes that you would like to be fulfilled as you pass your property to your heirs. Specific wishes may be better served by a trust, otherwise a LLC would suffice. Note they are not mutually exclusive and any trust you dream up could very well include LLC's to hold / protect the underlying properties in the trust.
I would be happy to connect you with a Trust / Estate attorney and or a RE attorney if it would be useful.
Hope this helps.
Real estate investment trusts are being sold these days as a vehicle to anonymity. I personally don't see a lot of value in them for most investors unless you're working within an estate planning context. As has been noted, the LLC is the standard holding entity for real estate in the US.