The Motley Fool

Retirees: 2 REITs With Yields Up to 7.6% I’d Buy for 2020

As we head into yet another U.S. election year, investors should expect volatility to spike. And for retirees who don’t have as strong a stomach as other investors, here are the REITs that can provide the perfect balance of high income and low volatility.

This piece will focus on three high-yield REITs with low betas that allow retired investors to do better than market averages without losing sleep over massive market moves on any given day. So, without further ado, here are the REITs in ascending order based on yield.

WPT Industrial REIT

WPT Industrial REIT (TSX:WIR.U) could be the best industrial REIT since Pure Industrial Real Estate Trust (PIRET), a top-performing industrial REIT that got scooped up a few years ago.

Industrial REITs are a hot commodity, and WPT should be at the top of your buy list if you’re looking to benefit from strong secular tailwinds driven by the continued rise of e-commerce.

Higher consumer spending online means more packages need to be shipped. More packages shipped means a higher demand for warehouse stays, and that’s where WPT shines.

The REIT owns and operates warehouse and distribution properties across 18 U.S. states. As cash flows are in U.S. dollars, investors are also able to benefit from a weakening loonie relative to the greenback.

WPT Industrial sports a 5.6% yield at the time of writing, and as management goes on the hunt for acquisitions to further bolster its impressive portfolio of industrial properties, I see above-average AFFO growth potential over the next decade and beyond.

Moreover, WPT looks like a coiled spring from a technical perspective, setting shares up for a potential bounce in 2020. Shares of the name have been consolidating for nearly three years, and with a mere 0.65 beta, shares are unlikely to overreact on news that’ll send the broader markets up or down by triple-digit percentage points.

Inovalis REIT

Inovalis REIT (TSX:INO.UN) is another under-the-radar REIT with a very uneventful stock chart. Shares of Inovalis are currently at all-time highs while continuing to possess a bountiful 7.6% yield, which is unheard of for a name that’s at or around its highs.

The distribution is by design, and not only is it safe and supported by funds from operations, but it’s also subject to some growth over the next few years, as management looks to expand upon its relatively small portfolio of French and German office properties.

While you may not get much in terms of capital gains, you will get massive distributions to supplement your monthly income fund. Similar to WPT, you’re also getting a name that’s less likely to react on big-pictures news events with the low 0.38 beta.

Office properties may not be facing a secular tailwind as industrial properties are. One could argue that offices are facing a mild headwind as the “work from home” phenomenon continues to take off. Despite this, Inovalis remains a robust long-term play because a vast majority of its properties are located within some of the hottest urban areas in France and Germany.

Inovalis properties are in prime locations — and that’s where the REIT’s real long-term strength lies.

Stay hungry. Stay Foolish.

Just Released! 5 Stocks Under $49 (FREE REPORT)

Motley Fool Canada's market-beating team has just released a brand-new FREE report revealing 5 "dirt cheap" stocks that you can buy today for under $49 a share.
Our team thinks these 5 stocks are critically undervalued, but more importantly, could potentially make Canadian investors who act quickly a fortune.
Don't miss out! Simply click the link below to grab your free copy and discover all 5 of these stocks now.

Claim your FREE 5-stock report now!

Fool contributor Joey Frenette has no position in any of the stocks mentioned. Inovalis is a recommendation of Dividend Investor Canada.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss an important event.

Iain Butler and the Stock Advisor Canada team only publish their new “buy alerts” twice a month, and only to an exclusively small group.

This is your chance to get in early on what could prove to be very special investment advice.

Enter your email address below to get started now, and join the other thousands of Canadians who have already signed up for their chance to get the market-beating advice from Stock Advisor Canada.

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.