According to the acclaimed website Investopedia , real estate is defined as the land along with any permanent improvements attached to the land, whether natural or man-made — including water, trees, buildings, homes, etc. Real estate is a form of real property, being the land and everything attached to the land and the right of ownership to possess, sell and lease such for monetary benefits.

For practicality, real estate and real property are synonymous. It is also classified as an alternative investment in which stocks and/or bonds are traditional. Of course, there are different types of real estate which most people may be familiar with being residential, commercial, industrial, hospitality and greenfield or brownfield properties, which some people may not be so familiar with. Greenfield refers to land not previously used for a residential, commercial or industrial purpose and brownfield is property that was once used for commercial or residential use but is now targeted for redevelopment.

Most people again may be familiar with the high outlay of buying real estate, rendering it unattainable for ownership. Albeit numerous people are familiar with or have shareholdings in a real estate investment trust (REIT), which is a cost-efficient and seamless way to own and participate in real estate. However, with no pun intended, there are alternative investments in the asset class that is and of itself defined as alternative. This is buying shares in a fund or vehicle that does real estate financing.

The financing of real estate developments or projects are often done through cash, mortgages and construction loans from the bank. However, where there is a funding mismatch for one reason or the other, this is where specialty finance companies step up to the table and discussions are held. It is at this stage where the benefit of alternative or specialty financing has the most value for both the builder and the investor, as the financier usually gives debt or equity investment at the pre-development or development stage. This can also be referred to as the value-added stage. Investors now can finance developments or projects by owning shares in a real estate financing vehicle, soon to be listed on a stock exchange, just like a REIT, if nothing changes.

The advantages of investing in real estate are often touted by investment mangers and financial advisors as it is an ‘hedge’ against inflation, due to price appreciation and revaluation, income generation from rent or lease payments and a means of diversification or enhancement in one’s portfolio. Indirect ownership and participation in real estate has never been made easier.