Terminology related to commercial real estate investment products varies widely and is often unclear due to the complexity of the instruments. For purposes of this report, FinCEN used the following working definitions. REITs3 , which came into formal existence in the 1960s due to tax law changes4 , are entities that typically own multiple commercial properties, often focused in one sector of the commercial real estate market. Institutional and individual investors can purchase REIT shares in the public market or in private offerings. CMBS have existed since the mid-1990s. 5 According to the Congressional Oversight Panel, “CMBS are asset-backed.
