What Is an External REIT Manager?

By Kristi Waterworth – Updated Dec 10, 2025 at 12:25 AM EST

Key Points

External REIT managers oversee multiple properties, potentially offering broader insights.
Benefits of external managers include lower management costs and streamlined operations.
Drawbacks include potential conflicts of interest and less alignment with shareholder goals.
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Considering investing in real estate investment trusts (REITs)? One of the important considerations with these types of companies is how they're managed. Let's explore what an external REIT manager is and why that matters to you.

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Conflict of Interest

A situation where conflicting incentives hinder a person or party from fulfilling obligations impartially and without bias.

In addition, external REIT managers can create conflicts of interest or corporate governance problems, especially if they hold positions on the REIT's board of directors. This situation can be bad for shareholders and generally very suspicious for potential investors, even if the external REIT manager has no bad intentions.

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About the Author

Kristi Waterworth has been a contributing real estate and financial expert at The Motley Fool, covering real estate, investing, and personal finance topics, since 2020. Kristi has been interviewed by various TV media outlets and podcasts for her real estate investing expertise – from residential real estate to digital real estate and everything in between. Kristi’s journalist career spans over 25 years, and she has written about real estate investing, homeownership, and home construction specifically for the last decade. She was also previously a licensed Realtor and general building contractor before the Great Recession and housing market collapse. She holds a bachelor’s degree in American history from Columbia College in Missouri.

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