As intelligent investors know, dividend-paying stocks generate higher returns than non-dividend-paying stocks over the long term, and real estate investment trusts, or REITs, have the highest yields on average. With these facts in mind, let’s take a look at three REITs with yields up to 10.5% that you could add to your portfolio today.
1. Dream Office Real Estate Investment Trust: 10.5% yield
Dream Office Real Estate Investment Trust (TSX: D.UN) owns 176 commercial properties in Canada, totaling approximately 24.1 million square feet of gross leasable area. It pays a monthly distribution of $0.18666 per share, or $2.24 per share annually, giving its stock a 10.5% yield at today’s levels.
Investors should also note that the company has maintained this monthly rate since May 2013, and its consistent funds from operations, including $273.1 million in fiscal 2014 and $140.8 million in the first half of fiscal 2015, could allow it to continue doing so for the next several years.
2. Slate Retail REIT: 7.3% yield
(All figures are in U.S. dollars)
Slate Retail REIT (TSX:SRT.UN) owns 64 grocery-anchored shopping malls located primarily across the top 50 U.S. metro markets. It pays a monthly distribution of $0.063 per share, or $0.756 per share annually, which gives its stock a 7.3% yield at current levels.
It is also worth noting that Slate increased its distribution by 5% in December 2014 as a result of its strong operational performance, and its increased amount of funds from operations, including 216.2% year-over-year growth to $14.3 million in the first half of fiscal 2015, could allow for another increase in December of this year.
3. Pure Industrial Real Estate Trust: 7% yield
Pure Industrial Real Estate Trust (TSX:AAR.UN) owns 173 industrial properties in North America, totaling approximately 17.4 million square feet of gross leasable area. It pays a monthly distribution of $0.026 per share, or $0.312 per share annually, giving its stock a 7% yield at today’s levels.
Investors should also note that Pure Industrial has maintained this monthly rate since November 2012, but its increased amount of funds from operations, including 34.6% year-over-year growth to $32.7 million in the first half of fiscal 2015, could allow for a significant increase in the second half.
Which of these REITs should you buy today?
Dream Office, Slate Retail, and Pure Industrial are three of the most attractive investment options in the real estate industry today. Foolish investors should strongly consider initiating positions in one of them.
