The Perfect TFSA Stock: A 5% Yield With Monthly Paycheques

This dividend stock appears perfect to hold inside a TFSA as it offers a compelling yield of over 5% and sends paycheques every month.

Key Points
  • Holding high-yield dividend stocks inside a TFSA can generate steady tax-free passive income.
  • The REIT offers a monthly dividend of $0.058 per unit, yielding about 5.1%.
  • The REIT benefits from strong demand for urban industrial properties, high occupancy, solid rental growth, and value-added services.

Investors seeking a steady stream of income could consider high-quality dividend stocks with attractive, reliable yields. Moreover, holding them in a Tax-Free Savings Account (TFSA) can make the strategy even more rewarding, as any dividend income earned remains tax-free.

Among income-focused investments, Canadian companies that pay monthly dividends stand out. Their regular distributions can provide a paycheque-like income stream, making it easier to cover recurring expenses or reinvest earnings throughout the year.

With this backdrop, here is a dividend stock that looks perfect for a TFSA. It offers a compelling 5% yield and sends paycheques every month.

Person holds banknotes of Canadian dollars

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A perfect TFSA monthly dividend stock

For investors seeking steady passive income in a TFSA, Dream Industrial REIT (TSX: DIR.UN) could be a compelling investment. The real estate investment trust has been consistently paying a monthly dividend and offers an attractive yield.

Dream Industrial REIT owns and operates a high-quality portfolio of urban industrial properties across Canada, Europe, and the U.S. Its assets are strategically located in or near major population centers, serving a wide range of tenants with facilities designed for warehousing, light manufacturing, outdoor industrial storage, and last-mile logistics.

The REIT’s focus on urban industrial properties provides a significant competitive advantage. With limited land available for new development in these markets, supply remains constrained while demand for well-located industrial space continues to grow. This favourable balance supports higher rental rates, strong occupancy levels, and resilient operating performance over time.

Its operational performance has remained solid. At the end of the first quarter of 2026, occupancy stood at an impressive 95.7%, reflecting continued demand for its properties. Rental growth has also been strong, particularly in Canada, where in-place rents increased 10.7% year over year. This growth was driven by lease renewals, new leasing activity, positive rental rate spreads across all regions, and built-in annual rent escalators.

The REIT currently pays $0.06 per unit each month, translating to a yield of approximately 5.1% based on its June 1 closing price of $13.85.

Dream Industrial REIT to keep sending monthly paycheques

Although ongoing geopolitical uncertainty and trade tensions continue to create challenges, Dream Industrial REIT is focused on expanding its portfolio in key urban markets. The company is also expanding ancillary revenue opportunities and pursuing acquisitions expected to strengthen earnings and support future distributions.

The REIT is well-positioned to maintain its monthly distributions, supported by resilient demand for logistics and warehouse space. Higher leasing activity, rising rental rates, and the gradual absorption of vacant space are likely to support organic revenue growth.

Moreover, the REIT is leveraging its real estate portfolio to generate additional revenue through initiatives such as solar installations, electric vehicle charging stations, and telecom infrastructure. These income streams enhance earnings stability while creating new long-term growth opportunities.

The solar business is gaining momentum, with several projects already operational and more under development. Favourable economic trends also support the outlook. Supply chain realignment, increased nearshoring activity, and growing logistics requirements related to defence spending are boosting demand for strategically located industrial properties. These factors are helping sustain high occupancy levels and support rental growth.

Overall, Dream Industrial REIT is well-positioned to deliver a steady monthly dividend, driven by strong occupancy, rising rents, and diversified revenue streams.

Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Dream Industrial Real Estate Investment Trust. The Motley Fool has a disclosure policy.

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