A Grocery-Anchored REIT Yielding 8.4% That Most Canadian Investors Have Never Heard Of

Firm Capital Property Trust offers high monthly income from a diversified Canadian real estate mix, but the payout is only as good as its coverage.

Amy Legate-Wolfe

Author Bio Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Social Media Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published March 30, 10:01 am EDT

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Key Points

It pays a steady monthly distribution and currently yields more than 8%.
AFFO coverage has been improving, yet the payout ratio still runs tight, so execution matters.
The units trade below reported NAV, which adds upside potential if REIT sentiment improves.

Monthly dividend stocks can be great purchases because they make income feel more predictable. Instead of waiting through a whole quarter, investors get cash showing up every month, which can be reinvested sooner or used to help cover regular bills. That steady rhythm can also make a stock easier to hold when markets get jumpy. Of course it doesn’t remove all the risk, but it can make investing experience feel a lot smoother.

If you are a Canadian income investor looking for a high monthly yield, I have one for you.

fast shopping cart in grocery store — Source: Getty Images

Firm Capital Property Trust: Monthly Income From Necessity-Based Real Estate

Firm Capital Property Trust (TSX: FCD.UN) is a diversified Canadian REIT that owns a mix of grocery-anchored retail, industrial, multi-residential, and manufactured home community properties. That mix matters because it gives the REIT exposure to several corners of real estate rather than one narrow niche. As of the latest annual results, the portfolio consists of 62 commercial properties with a total gross leasable area of approximately 2.43 million square feet, five multi-residential complexes comprising 599 units, and four manufactured home communities with 537 total units.

The geographic and asset diversification is also worth noting. Grocery-anchored retail makes up 49% of net operating income (NOI) — the income that properties generate after operating costs but before financing and depreciation. The grocery-anchored retail also accounts for 44% of asset value. Then, industrial clocks in at 28% of NOI and 28% of asset value, with Ontario and Quebec each representing approximately 37% of NOI. That is a reasonably defensive mix — groceries and industrial are not sectors that tend to empty out in a downturn.

Over the past year, the story has been more about fine-tuning than flashy expansion. In 2025, the trust completed asset sales from its Centre Ice retail portfolio and Montreal industrial portfolio for gross proceeds of $29.3 million. Management also improved the distribution reinvestment plan in July 2025, lowering the DRIP floor price and adding a 3% discount on treasury-issued units above the new threshold — a quiet way to reward loyal unit holders. The trust has kept its payout steady at $0.04333 per unit each month, or $0.52 annualized, with distributions already declared through July 2026.

2025 Results: The Payout Ratio Finally Crossed Below 100%

Full-year 2025 results were released on March 10, 2026, and the headline number is encouraging. Q4 2025 AFFO came in at approximately $4.9 million, or $0.133 per unit — a 2% increase over Q4 2024 — and the AFFO payout ratio improved to 98%, down from 100% in the prior year. That is the first time the payout ratio has dropped below 100% in recent quarters, which is a meaningful signal that the distribution is becoming better supported.

Full-year 2025 revenue reached $61.86 million, essentially flat versus $61.40 million in 2024. The trust also completed an important financing improvement: the revolving operating facility was extended to October 31, 2027 and its availability was increased from $19 million to $35 million — a practical balance sheet move that removes near-term refinancing pressure. A first mortgage was also refinanced in December 2025 at a fixed rate of 4.15% for four years, locking in a reasonable rate before any rate volatility.

The Valuation Case

Valuation is where the income case gets more interesting. The units recently traded around $6, giving the REIT a market cap near $222 million and a forward yield of around 8.4%. The trust’s reported NAV from the Q4 2025 release is $8 per unit — meaning the units trade at roughly a 25% discount to book value. That discount is part of the appeal, though it also reflects the market’s caution around smaller REITs and the fact that payout coverage, while improving, is still tight. Verify current price and yield before acting.

Bottom line

Looking ahead, Firm Capital Property Trust fits income investors who want monthly cash and can handle a little imperfection. The payout ratio crossed below 100% for the first time in Q4 2025, the revolving credit facility has been extended and enlarged, and the portfolio’s defensive grocery-anchored and industrial mix provides a reasonable foundation. The risk is that softer occupancy or stubborn financing costs could keep pressure on coverage. Still, for investors who want a high monthly yield from a diversified, necessity-based real estate portfolio trading at a meaningful discount to NAV, this one is worth a closer look.