Getting paid every month from your investments can change the way you think about income. Instead of waiting for quarterly dividends, it feels amazing to receive cash on a steady monthly schedule. That can make your financial planning easier and give you more flexibility. One TSX real estate investment trust, or REIT, currently offers a 5.6% annualized yield and rewards investors with handsome dividends every single month. In this article, I’ll talk about H&R REIT (TSX: HR.UN) and tell you why it could be a great monthly dividend stock for income investors.
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A diversified real estate platform with scale
H&R Real Estate Investment Trust is a large diversified Canadian REIT. At the end of the September 2025 quarter, it had total assets of about $9.6 billion. The trust is based in North York and owns interests in more than 25 million square feet of residential, industrial, office, and retail properties across Canada and the United States.
Its stock currently trades at $10.84 per share, giving it a market cap of roughly $2.9 billion. At that price, investors receive an annualized distribution of $0.60 per share, paid out as $0.05 each month. That works out to a 5.6% yield.
Financial performance supports the payout
H&R’s ongoing financial growth trends look stable as it generated $81.1 million in funds from operations (FFO) in the third quarter of 2025, compared with $82.3 million a year ago. For the first nine months of 2025, FFO totalled $252 million, slightly higher than the $251 million reported during the same period in 2024.
Similarly, its adjusted funds from operations (AFFO), which is usually seen as a better measure of sustainable cash flow, came in at $205.6 million for the first nine months of 2025. That was nearly unchanged from $205.4 million in the previous year. During this period, H&R’s payout ratio was 50% of FFO and 61.3% of AFFO.
For a REIT, those payout levels are fairly reasonable, as they suggest that its current monthly distribution is comfortably backed by its ongoing operating cash flow.
Strategic repositioning could unlock value
H&R REIT reported net losses in 2025, but these were mainly due to non-cash fair value adjustments on real estate assets, totalling more than $750 million in the first nine months of the year. Many of these adjustments were linked to its properties classified as held for sale and changes in valuation assumptions, rather than a drop in its rental income.
The trust is currently in discussions to sell assets worth about $2.6 billion. Some of its office and retail properties have already been classified as held for sale, and binding agreements are expected before the end of the year. By doing so, H&R plans to simplify its portfolio, strengthen financial flexibility, and potentially improve long-term returns.
Foolish takeaway
For Foolish investors focused on dividend income, consistency matters most. H&R has a diversified portfolio, steady operating cash flow, and payout ratios that seem quite manageable.
While property values can move up and down, for long-term investors looking for steady monthly income, H&R Real Estate Investment Trust remains an attractive stock to consider.
