In Europe today, there are two main vehicles for indirect investment in real estate: real estate investment funds and listed real estate companies. With these instruments not only does the investor take a position in the real estate market, he/she also acquires different risk/return structures, which may vary according to the instrument being used. In some European countries, real estate companies have modified their financial structure and tax position by adopting a legal form based on REITs (Real Estate Investment Trusts), which originated in the US; this changes their position compared to real estate funds. In this paper we compare real estate funds and listed real estate companies and analyse the appearance of REITs in Europe and their impact on the real estate industry.