What do you do with the new money that is generated from new investments?

REITs require new capital for a variety of reasons, but mainly to purchase additional properties to add to the portfolio.  This allows for further diversification and improves the economies of scale which in turn also helps drive down costs, making a REIT more profitable in the long term.  New investment dollars are also used to fund improvements to buildings already in the portfolio.  By attacking costs (implementing energy-saving solutions such as new low-flow toilets, light bulbs, shower heads, fridges and other appliances), the REIT can generate incremental revenue that goes directly to investors.