The average dividend yield for the broader Canadian stock market is between 2% and 3%, a decent offer for harnessing the power of dividends. However, for dedicated dividend chasers, this tiny yield won’t accelerate compounding fast enough. They would also prefer monthly cash flows instead of quarterly.
Nexus Industrial (TSX:NXR.UN) fits the bill perfectly, although this TSX stock, which pays a monthly dividend, could face pressure in a higher-for-longer interest rate environment. The $780.6 million real estate investment trust (REIT) pays a towering 8% yield along with a monthly payment schedule. NXR.UN currently trades at $8.05 per share, up 5.4% year to date.
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Pseudo landlord advantage
REITs provide the same passive-income stream that physical rental properties deliver to landlords. These assets, however, don’t come with the headaches of property management, constant upkeep, or the hassle of collecting rent every month.
In Canada’s REIT industry, you can invest and choose among the primary sub-sectors: residential, retail, office, diversified, and industrial. Based on its name, you can easily tell where Nexus belongs. Today, it operates as a pure-play industrial REIT, managing institutional-quality logistics and warehouse properties. Also, it focuses solely on acquiring industrial properties across high-growth markets and in-demand locations in Canada.
Nexus owns a portfolio of 88 industrial properties that provide stable cash flows. The embedded yearly rental escalations in the long-term leases reflect strong organic growth. As of March 31, 2026, the weighted average lease term (WALT) is 6.9 years, while the occupancy rate is 95%. The estimated spread between industrial portfolio market and in-place rents is 15.8%.
According to CBRE, the industrial market is set to stabilize in 2026 and begin to recover. The renowned commercial real estate services and investment firm added that the industrial market fundamentals in Canada are largely balanced, with leasing demand remaining resilient.
Trade is an ongoing concern, given the upcoming review of the Canada-U.S.-Mexico (CUSMA) trade agreement in July 2026. Nonetheless, CBRE believes there are potential opportunities. Federal government tax incentives on manufacturing and processing facilities could further boost design-build construction activity across Canada.
Financial highlights
In the first quarter (Q1) of 2026, property revenues increased 2.8% year over year to $46 million, while net income and comprehensive income declined 2.9% to $32.2 million versus Q1 2025. Net operating income (NOI), however, rose 5.4% to $33.8 million from a year ago.
Kelly Hanczyk, CEO of Nexus Industrial, said, “In the first quarter, we advanced our journey as Canada’s industrial building partner, delivering a normalized AFFO [adjusted funds from operations] payout ratio of 96.6%, a meaningful improvement over recent quarters.” For the full year, the target is a ratio below 100%.
On April 14, 2026, Nexus received an investment-grade credit rating from DBRS, a global rating agency. It led to the completion of an inaugural $500 million bond offering, adding financial flexibility and reducing the cost of capital. Hanczyk added that the accomplishment ushered in a new stage in the REIT’s evolution.
Hard to pass up
Given Nexus’s stock price and dividend offer, an $8,005 investment, or 1,000 shares of NXR.UN will generate $53.67 every single month. The money will compound to $17,868.10 in ten years if you reinvest the dividends. This deal is hard to pass up for investors seeking consistent, generous cash streams.
