Lack of Liquidity - Generally offered by private financial planners, private REITs are not nearly as liquid as public real estate investment trust shares. One cannot just call their broker and sell their private REIT shares.
Higher Sale Commissions - Private REITs generally carry a higher sale commission to the seller, so fewer dollars make it into the investment. Conflicts of interest can be present for this reason, as sellers could want the REIT to grow to increase their profits.
Before jumping into a private real estate investment trust, be sure to look carefully at the prospectus and every facet of how it's managed, dividends distributed and costs/fees.
