3 High-Yield REITs Offering an Average Yield of 7%

Here are three REITs with an average yield of 6.95% to consider. For diversification each of these REITs specializes in a different market,

| More on:
Pixelated acronym REIT made from cubes, mosaic pattern

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

Real estate investment trusts, or REITs, typically offer a generous dividend yield. This high yield has made REITs a popular investment choice since the first Canadian REIT was listed on the TSX in 1993.

If you are looking to invest in this popular option, here are three REITs to consider. For diversification, each of these REITS specializes in a different market.

Gaming and Leisure Properties

The COVID-19 pandemic has taken its toll on entertainment venues. So, if you are looking to cash in on the pent-up demand for casinos and gaming, consider Gaming and Leisure Properties (NASDAQ:GLPI).

Gaming and Leisure Properties was founded in 2013 as America’s first REIT. The company’s assets include 48 properties throughout 16 states. Combined, these properties total over 23 million square feet of property.

The company operates over 13,000 hotel rooms. Some of Gaming and Leisure’s most well-known tenants include Penn National Gaming, Caesars Entertainment, Boyd Gaming Corporation, and Casino Queen.

With a market cap of US$10.66 billion, the company plans to grow its portfolio by pursuing opportunities to acquire additional gaming facilities to lease to gaming operators through triple-net lease arrangements. Over time, the company plans to diversity its portfolio by acquiring properties outside the gaming industry.

As of this writing, shares of Gaming and Leisure Properties are trading at US$45.77, near their 52-week high. During the pandemic, the stock reached a low of US$24.39. At the current price, the divided yield is 5.71%.

Inovalis Real Estate Investment Trust

With a market cap of approximately $320 million, Inovalis Real Estate Investment Trust (TSX:INO-UN) owns assets primarily located in France and Germany.

Inovalis currently owns 14 office properties. These properties are strategically located in city centres near transport hubs. Their location makes them ideal for offices that want to make the commute easier for their employees.

Due to the pandemic, Inovalis experienced a steep decline in revenues and gross profits in 2020. However, the company has sustained its dividends during previous economic declines.

Shares are trading at $9.89 as of this writing, nearing their year-long high. The current dividend yield is 8.34%.

Sabra Health Care

Sabra Health Care (NASDAQ:SBRA) is a REIT that owns over 425 healthcare facilities. The facilities specialize primarily in skilled nursing and eldercare and are located throughout the U.S. The company is also involved in a joint venture that owns 158 senior housing properties, which are managed by operators instead of leased.

Sabra experienced lower occupancy rates during the COVID-19 pandemic which negatively impacted earnings. In the most recently reported quarter, the REIT’s total revenue declined 2.5% year over year.

However, many of Sabra’s senior residents are covered by federal and state healthcare plans. These plans provide a reliable source of cash flows partially passed along to Sabra. The demand for medical properties like hospitals, skilled nursing, and senior housing is expected to grow, with the population of adults age 65 and older projected to increase by 44% over the next 20 years.

With shares trading at US$17.93 as of this writing, Sabra’s dividend yield is 6.81%.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Cindy Dye has no position in any of the stocks mentioned. The Motley Fool recommends Inovalis REIT.

More on Investing

funds, money, nest egg
Dividend Stocks

TFSA Passive Income: 2 Great Canadian Dividend Stocks for Retirees to Buy Now

Retirees seeking reliable passive income can now buy top TSX dividend stocks at cheap prices.

Read more »

man window buildings
Stocks for Beginners

Foolish Beginners: 1 Stock Pick to Buy Now for a $6,000 TFSA

Brookfield Asset Management (TSX:BAM.A)(NYSE:BAM) stock looks cheap as shares regain their footing.

Read more »

data analyze research
Dividend Stocks

Earn Monthly Passive Income: 2 Hot Dividend Stocks in Canada to Buy Now and Hold Forever

These two hot dividend stocks could help you to earn stable monthly passive income in Canada.

Read more »

Human Hand Placing A Coin On Increasing Coin Stacks In Front Of House
Dividend Stocks

Be a Landlord: Top 2 REITs (With Monthly Dividends) I’d Buy and Forget

You can be a landlord and earn monthly dividends for the rest of your life. All you need is the…

Read more »

Target. Stand out from the crowd

3 Canadian Stocks to Buy That Beat Their Earnings Expectations This Week

If you're looking for top Canadian stocks to buy, here are three impressive companies that continue to perform well in…

Read more »

A stock price graph showing declines
Energy Stocks

2 Cheap Canadian Stocks That Likely Won’t Be on Sale For Much Longer

These two Canadian stocks are close to returning to all-time highs. Don’t miss your chance to take advantage of these…

Read more »

A worker gives a business presentation.
Dividend Stocks

Got $5,000? 3 Stocks to Hold for the Next 20 Years

New investors don’t need tens of thousands to start a portfolio. Here are three stocks to hold for the next…

Read more »

canadian energy oil
Energy Stocks

3 Rising Energy Stocks to Buy as Oil Hits 6-Month Low

Three rising energy stocks are strong buys today as their upward momentum is likely to continue due to the tight…

Read more »