What is a characteristic of Hybrid REITs?

Hybrid REITs are characterized by their dual investment strategy that incorporates both ownership of real property and investment in mortgage-backed securities. This allows them to generate income from rental revenues as well as interest received from mortgage loans. The combination of these two investment approaches offers a diversified revenue stream, positioning Hybrid REITs to benefit from both property appreciation and mortgage interest payments. Such versatility enables them to adapt to varying market conditions and investment opportunities, making them a popular choice among investors seeking a balanced portfolio strategy that includes both direct real estate investment and mortgage financing.

The other options describe characteristics that do not align with Hybrid REITs. While some REITs may solely focus on mortgage investments or may have investor capital requirements, Hybrid REITs specifically combine elements of both categories, distinguishing them from their peers in the REIT landscape. Additionally, the assertion about them being the least common type of REIT does not accurately reflect their position in the market, as they are quite prevalent compared to other singular forms of REITs.