Reliable income can be hard to come by in a volatile market. That’s why dividend stocks with consistent payouts and long-term growth potential are so valuable, especially within a Tax-Free Savings Account (TFSA). If I were choosing one top pick today for immediate income, Dream Industrial Real Estate Investment Trust (TSX: DIR.UN) would be it.
Why Dream?
Dream Industrial REIT focuses on industrial real estate, which continues to benefit from long-term demand in areas like e-commerce, logistics, and warehousing. It owns and operates a portfolio of 336 industrial properties across Canada, the U.S., and Europe, with more than 72.6 million square feet of gross leasable area. These properties are crucial links in the supply chain for businesses of all sizes. As more companies prioritize just-in-case over just-in-time inventory models, demand for storage space has continued to rise, even as other real estate segments remain under pressure.
As of writing, Dream Industrial offers a forward dividend yield of 6.7% and pays a steady monthly distribution of $0.0583 per unit. That’s equivalent to about $0.70 annually. That’s a solid cash flow stream that beats most guaranteed investment certificates (GICs) and has the potential to grow over time.
Its first-quarter 2025 results confirmed the REIT is in a strong financial position. Funds from operations rose to $0.26 per unit, up 5.8% from the same time last year. Net rental income increased 6.8% to $91.7 million. Comparative properties’ net operating income rose 3.1%, reflecting the strength of its existing assets. The dividend stock also reported a 97% occupancy rate, suggesting strong tenant demand.
More to come
What sets Dream Industrial apart is its proactive growth strategy. Since the beginning of 2025, the REIT has closed more than $460 million worth of acquisitions, adding 1.2 million square feet of leasable space and over 31 acres of land. It also has an active development pipeline and has been unlocking value by repurposing and densifying existing sites. This means the dividend stock isn’t just sitting on its current portfolio; it’s actively building for the future.
Debt management is also a priority. As of Mar. 31, 2025, Dream Industrial had already addressed about 50% of its $850 million in debt maturing this year. It’s evaluating a number of alternatives for the remaining portion. Its debt to total assets ratio stands at a manageable 38%, and it maintains significant liquidity through revolving credit facilities. This conservative approach gives the REIT flexibility to grow while protecting investors from financial strain.
Another factor that makes Dream Industrial an appealing option is that it currently trades at a discount to its estimated net asset value. That means you’re not just collecting a steady income; you may also benefit from capital appreciation as the unit price catches up to the real value of its portfolio. Some analysts estimate fair value to be 10-15% higher than where the stock is trading now.
Foolish takeaway
What I appreciate about Dream Industrial is that it blends two essential ingredients: reliable income and built-in growth. It’s not chasing aggressive expansion at the cost of its balance sheet, but it also isn’t standing still. The dividend stock continues to build in top industrial markets like Toronto, Montreal, and key logistics hubs across Europe. This geographic diversification helps reduce risk and ensures the company is capturing opportunities wherever they arise.
In an era where high interest rates are putting pressure on consumer spending and economic growth, industrial real estate offers a relatively safe haven. Businesses need distribution centres and logistics hubs, no matter the economic climate, and investors need income sources that won’t dry up the moment the market stumbles.
If I were to put together a TFSA income portfolio today, Dream Industrial would sit right at the top. The combination of a high yield, monthly payouts, and exposure to one of the most resilient real estate sectors makes it my go-to pick for immediate and sustainable returns. It’s not flashy, but it’s reliable. And when it comes to income investing, that’s exactly what I want.
