The Canadian real estate sector is always evolving, shaped by population growth, immigration, e-commerce, and shifting work habits. Even with higher interest rates and economic uncertainty heading into 2025, many real estate investment trusts (REITs) have continued to deliver solid returns. For investors searching for long-term value and passive income, real estate stocks can still offer a mix of stability and growth, especially when you know where to look.
Three names that continue to stand out on the TSX are Canadian Apartment Properties REIT (TSX:CAR.UN), Granite REIT (TSX:GRT.UN), and SmartCentres REIT (TSX:SRU.UN). Together, these real estate stocks cover the residential, industrial, and retail spaces of Canadian real estate, making them great starting points for a diversified investment.
CAPREIT
CAPREIT is one of the largest residential landlords in Canada, with over 67,000 apartment and townhouse units under management. In a market where homeownership feels out of reach for many, demand for rentals has stayed strong. In its fourth-quarter 2024 earnings report, CAPREIT posted a net operating income of $204.1 million, up 6.3% from the year before. Occupancy came in at a very healthy 98.5%, and same-property average monthly rents rose by 6.9%. It also continues to grow its portfolio, acquiring 1,384 residential suites and 216 manufactured home community sites in 2024.
CAPREIT has kept its balance sheet strong. It ended the year with a debt-to-gross book value of just under 40%, and its payout ratio remained conservative at 65.4% of adjusted funds from operations. With steady cash flow, a growing asset base, and exposure to stable housing demand, it remains one of the safest long-term REITs on the TSX.
Granite
Granite REIT, meanwhile, plays in a very different sandbox. It owns logistics, warehouse, and industrial properties across Canada, the U.S., and Europe. Plus, it’s been a big winner from the global shift toward e-commerce and just-in-time delivery. In the fourth quarter (Q4) of 2024, Granite reported $92.7 million in funds from operations, or $1.47 per unit. That was up from $81.2 million, or $1.27 per unit, in the same quarter a year earlier. For the full year, Granite collected $352.3 million in FFO, a 12.7% increase.
Granite’s properties are 99.3% occupied, with a weighted average lease term of 6.2 years. One of Granite’s strengths is its conservative financing. It has a debt-to-total asset ratio of just 32%, giving it flexibility to grow. It also raised its distribution in 2024, marking 13 straight years of increases.
What sets Granite apart is its combination of inflation protection, long-term lease stability, and international reach. Industrial space continues to be in short supply in major centres like Toronto and Montreal, and rents are rising steadily. That makes it a solid pick for 2025 and beyond.
SmartCentres
SmartCentres REIT, best known for its network of Walmart-anchored retail plazas, has undergone a major transformation in recent years. While it still earns the bulk of its revenue from retail tenants, it’s been steadily redeveloping many of its properties into mixed-use communities that include apartments, seniors housing, and self-storage.
In Q4 2024, SmartCentres renewed 5 million square feet of leases at an average rental increase of 8.8%, not including anchor tenants. It also added 335,000 square feet of new leases and delivered nine new retail developments. Its committed occupancy rate remained high at 98.2%, and it announced several major mixed-use projects under development in Ontario and Quebec.
One of its most ambitious is SmartVMC in Vaughan, which includes office towers, condos, retail, and public transit access. As of the end of 2024, SmartCentres had over $13 billion in development projects at various stages, representing decades of potential growth. While retail REITs were once seen as risky, SmartCentres has proven that diversified, service-based retail still works.
Bottom line
Altogether, these three TSX REITs show the strength and variety in Canada’s real estate sector. As we move through 2025, investors may want to look past short-term market noise and focus on these proven performers. Real estate stocks still play an important role in a balanced portfolio, especially when the companies behind it have a track record of managing change, delivering growth, and rewarding shareholders. Whether it’s through steady rents, rising distributions, or long-term development, these three real estate stocks are worth a closer look.
