Many investors see a Tax-Free Savings Account (TFSA) as a tool to work toward long-term financial freedom in the long run. While growth remains important, generating reliable passive income could also play an important role in building wealth over time. That’s why high-yield investments that provide regular monthly cash flow remain on TFSA investors’ radar.
Speaking of monthly income, investors should remember that a high yield alone is not enough to justify an investment. The quality of the underlying business and the sustainability of its payouts are just as important.
Keeping that in mind, one TFSA stock that looks appealing is Slate Grocery REIT (TSX:SGR.UN). Its portfolio is built around grocery-anchored properties, where tenant demand remains relatively resilient because the locations serve everyday consumer needs. Let’s look at some more reasons why this monthly dividend stock could deserve a spot in your TFSA portfolio.
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A top TFSA stock with monthly payouts
Slate Grocery REIT mainly focuses on grocery-anchored real estate across major U.S. metropolitan markets. These properties serve as critical community hubs, housing grocery stores and other essential retailers. This focus on necessity-based retail helps provide it with stable occupancy and recurring rental income.
Despite the broader market volatility and economic uncertainties, Slate Grocery stock has climbed by 15%. As a result, it currently trades at $17.19 per share, giving the trust a market capitalization of slightly more than $1 billion. More importantly for income investors, it rewards investors with attractive monthly dividends, with its annualized yield currently standing at around 6.9%.
Strong operating momentum
In the latest quarter ended in March 2026, Slate’s rental revenue rose by 11.8% year over year (YoY) to US$59.3 million with the help of strong leasing activity and higher rental rates. During the period, the real estate investment trust (REIT) completed more than 725,000 square feet of leasing activity at double-digit rental spreads.
Its renewal leases were completed at rates 18.9% above expiring rents, while new leases were signed at rates 49% above the comparable average in-place rents. These positive factors clearly show Slate Grocery REIT’s pricing power and give it a strong foundation for future revenue growth.
For the quarter, the REIT also reported same-property net operating income (NOI) growth of 2.1% on a trailing 12-month basis after adjusting for completed redevelopment projects. At the same time, its portfolio occupancy remained solid at 94.4%, highlighting the continued demand for its grocery-anchored properties.
A solid foundation for future growth
Beyond its current operating strength, Slate Grocery REIT maintains a weighted average interest rate of 5%, with 90.2% of its debt carrying fixed interest rates. These fixed rates give it stability in financing costs and reduce exposure to interest rate volatility.
Meanwhile, the REIT is also exploring opportunities to enhance unitholder value as it recently formed a special committee to review strategic alternatives, including a potential sale of the trust.
Foolish takeaway
Slate Grocery REIT offers a great combination of dependable monthly income, strong leasing momentum, and long-term growth potential. Its portfolio of essential grocery-anchored properties continues to generate solid operating results, while future rent growth opportunities and strategic efforts could provide additional upside, making it an attractive choice for TFSA investors.
