There are 2 sources of real estate : 1.Commercial Property 2.Residential Property
In commercial property you acquire polts which would be used by companies or big large organizations thereby generating revenue for you in the form of rental income and plus capital appreciation.Commercial property is far more better than residential property.
You acquire either flats or apartments or any other property in which people would live. The way of making money is pretty much the same . You get the money from the rental income plus the appreciation of the property.
REIT is pretty much like a stock , you get to acquire a piece of property for as less as rupees 500 . Isnt that great and the godd thing physical real estate is not liquid(cant sell easily)but Reits can be sold easily on the stock exchange.You get the appreciation as well and the dividend as well . The company which manages this has to invest 80%of the fund into commercial property therefore for retail investors it is the best choice .
For further understanding check out this article Real Estate Investment Trusts in India (REITs): An Introduction