What is return of capital?
The waterfall tier (and the REIT distribution component) that returns an investor’s original contributed capital before profit-sharing begins; as a REIT distribution it is not immediately taxed but reduces the shareholder’s basis.
Where you will use it: this term comes up in the Real Estate Finance course, and the full course glossary collects every term in one place.
Related terms
From the free Real Estate Finance course by Devon Coombs, CPA, MBA.