A high yield alone is not enough to make a stock worth owning in a Tax-Free Savings Account (TFSA) for the long term. The business behind that yield still needs to have dependable assets, a healthy demand for its products or services, and room to grow over the years.
SmartCentres Real Estate Investment Trust (TSX:SRU.UN) has most of those boxes. Its properties serve everyday retail needs, occupancy remains strong, and rent growth on renewed leases has been impressive. The real estate investment trust (REIT) also rewards investors with an attractive monthly distribution of about $0.15 per unit, equal to an annualized yield of over 6% at the current price.
Let me explain why SmartCentres could be one of the best monthly dividend stocks I would choose for reliable monthly income inside a TFSA right now.
Source: Getty Images
Why SmartCentres suits a monthly income TFSA strategy
If you don’t know it already, SmartCentres owns, develops, and leases retail, office, residential, industrial, and self-storage properties across Canada. Its portfolio includes 200 properties and 35.5 million square feet of income-producing retail and office space.
As of July 22, SmartCentres stock closed at $30.32 per share, giving the REIT a market capitalization of $4.4 billion. The stock has gained 18% so far in 2026 to trade just 2% below its 52-week high. That strong momentum reflects improving investor confidence in the REIT’s leasing strength, property values, and monthly income appeal.
At the current price, SmartCentres offers a 6.1% annualized dividend yield, paid monthly. Inside a TFSA, those monthly payments could be reinvested without creating a tax bill, helping each new unit produce more income over time.
Strong leasing keeps the income engine moving
SmartCentres ended the first quarter of 2026 with a solid in-place and committed occupancy rate of 97.6%. That figure had improved to 98% by its earnings release in May. The REIT had also extended about 80% of leases maturing in 2026.
In the latest quarter, its renewal activity was especially encouraging as average rent growth reached 11.5% excluding anchor tenants and 5.8% including them. SmartCentres also leased about 56,000 square feet of vacant space during the quarter and signed another 52,000 square feet of new retail demand.
These gains helped same-property net operating income rise 1.4% year-over-year, or 3.4% excluding anchor tenants.
Growth projects add another reason to own it
Meanwhile, SmartCentres is continuing to focus on new projects to accelerate growth further. Construction of a 200,000-square-foot retail building pre-leased to Canadian Tire remained on schedule, with possession expected in the third quarter of 2026. Recently, the REIT also acquired 18.8 acres in Kingston for about $7.1 million as part of its retail expansion program.
The company’s new self-storage facilities in Montreal and Laval were expected to open in the second quarter of 2026, while projects in Burnaby and Victoria were advancing toward 2027 openings. It’s also progressing with the ArtWalk condo Tower A in Vaughan, where about 93% of the 340 units have been pre-sold.
These projects give SmartCentres REIT several ways to expand rental income and property value over time. That growth potential, combined with strong occupancy and a juicy yield, makes SmartCentres an attractive TFSA stock for investors who want monthly income without giving up the chance for long-term gains.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | INVESTMENT | DIVIDEND PER SHARE | TOTAL PAYOUT | DIVIDEND FREQUENCY |
| SmartCentres REIT | $30.32 | 2,000 | $60,640 | $0.15417 | $308.3 | Monthly |
| Prices as of July 22, 2026 |
Generate $308 monthly passive income
At the recent price of $30.32 per unit, an investment of about $60,640 would buy 2,000 SmartCentres units. And based on the current monthly distribution of $0.15 per unit, that investment would generate about $308 in monthly income. If those monthly payments are reinvested inside a TFSA instead of being spent, the growing number of units could gradually produce even more monthly income over time through the power of compounding.
That said, rather than putting such a large amount into a single stock, investors may want to diversify their TFSA across multiple quality investments to help reduce risk while still building long-term wealth.
