2021 List Of All REITs

Up to date on Might eleventh, 2021 by Bob Ciura

Spreadsheet information up to date each day

Actual property funding trusts – or REITs, for brief – could be improbable securities for producing significant portfolio earnings. REITs extensively provide increased dividend yields than the common inventory.

Whereas the S&P 500 Index on common yields lower than 2% proper now, it’s comparatively simple to seek out REITs with dividend yields of 5% or increased.

The next downloadable REIT checklist incorporates a complete checklist of U.S. Actual Property Funding Trusts, together with metrics that matter together with:

• Inventory worth
• Dividend yield
• Market capitalization
• 5-year beta

You may obtain your free REIT checklist (together with necessary monetary metrics) by clicking on the hyperlink beneath:

Along with the downloadable Excel sheet of all REITs, this text discusses why earnings buyers ought to pay significantly shut consideration to this asset class. And, we additionally embrace our high 7 REITs as we speak.

Desk Of Contents

Along with the complete downloadable Excel spreadsheet, this text covers our high 7 REITs as we speak, as ranked utilizing anticipated whole returns from The Positive Evaluation Analysis Database.

The checklist is narrowed down additional based mostly on a qualitative evaluation of enterprise mannequin energy, development potential, and an evaluation of debt ranges. The highest 7 checklist is ranked by 5-year anticipated whole returns, so as of lowest to highest.

The desk of contents beneath permits for straightforward navigation.

How To Use The REIT Checklist To Discover Dividend Inventory Concepts

REITs give buyers the power to expertise the financial advantages related to actual property possession with out the effort of being a landlord within the conventional sense.

Due to the month-to-month rental cashflows generated by REITs, these securities are well-suited to buyers that intention to generate earnings from their funding portfolios. Accordingly, dividend yield would be the main metric of curiosity for a lot of REIT buyers.

For these unfamiliar with Microsoft Excel, the next photographs present find out how to filter for REITs with dividend yields between 5% and seven% utilizing the ‘filter’ perform of Excel.

Step 1: Obtain the Full REIT Excel Spreadsheet Checklist on the hyperlink above.

Step 2: Click on on the filter icon on the high of the ‘Dividend Yield’ column within the Full REIT Excel Spreadsheet Checklist.

Step 3: Use the filter features ‘Larger Than or Equal To’ and ‘Much less Than or Equal To’ together with the numbers 0.05 advert 0.07 to show REITs with dividend yields between 5% and seven%.

This may assist to remove any REITs with exceptionally excessive (and maybe unsustainable) dividend yields.

Additionally, click on on ‘Descending’ on the high of the filter window to checklist the REITs with the best dividend yields on the high of the spreadsheet.

Now that you’ve the instruments to establish high-quality REITs, the following part will present among the advantages of proudly owning this asset class in a diversified funding portfolio.

Why Spend money on REITs?

REITs are, by design, a improbable asset class for buyers seeking to generate earnings. Thus, one of many main advantages of investing in these securities is their excessive dividend yields.

The at present excessive dividend yields of REITs is just not an remoted prevalence. The truth is, this asset class has traded at the next dividend yield than the S&P 500 for many years.

The excessive dividend yields of REITs are because of the regulatory implications of doing enterprise as an actual property funding belief. In change for itemizing as a REIT, these trusts should pay out a minimum of 90% of their internet earnings as dividend funds to their unitholders (REITs commerce as models, not shares).

Generally you will note a payout ratio of lower than 90% for a REIT, and that’s doubtless as a result of they’re utilizing funds from operations, not internet earnings, within the denominator for REIT payout ratios (extra on that later).

One would possibly assume that the excessive payout ratios of REITs would end in inferior whole return efficiency in comparison with their friends (although they’ve excessive dividend yields).

This isn’t the case. In response to MSCI, which compiles and tracks the index, the MSCI US REIT Index generated whole annual returns of 10.6% per yr since December 30, 1994. It outperformed the MSCI USA Investable Market Index (IMI), its father or mother index that tracks the big, mid and small cap segments of the USA market, by roughly 60 foundation factors per yr in the identical interval.

REIT Monetary Metrics

REITs run distinctive enterprise fashions. Greater than the overwhelming majority of different enterprise varieties, they’re primarily concerned within the possession of long-lived belongings. From an accounting perspective, which means REITs incur vital non-cash depreciation and amortization bills.

How does this have an effect on the underside line of REITs?

Depreciation and amortization bills scale back an organization’s internet earnings, which implies that generally a REIT’s dividend can be increased than its internet earnings, although its dividends are secure based mostly on its money circulation.

To provide a greater sense of economic efficiency and dividend security, REITs finally developed the monetary metric funds from operations, or FFO. Identical to earnings, FFO could be reported on a per-unit foundation, giving FFO/unit – the tough equal of earnings-per-share for a REIT.

FFO is set by taking internet earnings and including again numerous non-cash prices which are seen to artificially impair a REIT’s perceived skill to pay its dividend.

For an instance of how FFO is calculated, think about the next internet income-to-FFO reconciliation from Realty Earnings (O), one of many largest and hottest REIT securities.

Supply: Realty Earnings Annual Report

In 2020, internet earnings was $395 million whereas FFO out there to stockholders was above $1.1 billion, a large distinction between the 2 metrics. This reveals the profound impact that depreciation and amortization can have on the GAAP monetary efficiency of actual property funding trusts.

The High 7 REITs Right now

Beneath we now have ranked our high 7 REITs as we speak based mostly on qualitative energy and whole return potential. These shares have constructive anticipated charges of return over the following 5 years, and excessive dividend yields which make them interesting for earnings buyers.

Added emphasis has been positioned on dividend sustainability, which is much more necessary for buyers to bear in mind through the coronavirus disaster, because it has had a very massive affect on REITs. The shares are listed so as of attractiveness based mostly on a mixture of qualitative and quantitative elements, resembling future development potential, present dividend yield, and dividend security.

High REIT #7: Omega Healthcare Traders (OHI)

Omega Healthcare Traders is among the premier expert nursing targeted healthcare REITs. It additionally generates about 20% of its annual income from senior housing developments. The corporate’s three fundamental promoting factors are its monetary, portfolio, and administration energy. Particularly, Omega is the chief in Expert Nursing Services.

Supply: Investor Presentation

OHI lately reported first-quarter outcomes which confirmed resilience within the face of the coronavirus pandemic. Adjusted FFO-per-share elevated 7.6% year-over-year. Omega collected over 99% of contractual hire and mortgage funds within the quarter.

The portfolio advantages from a good near-term provide and demand outlook. It additionally has no materials upcoming lease expirations or lease renewal threat and enjoys sturdy geographic and operator diversification (71 operators throughout 40 states plus the UK). Omega additionally has an investment-grade credit standing of BBB-.

Acquisitions will assist speed up the corporate’s development. For instance, Omega invested $595 million in acquisitions within the 2021 first quarter.

Whereas uncertainties over the way forward for the healthcare system in the USA stay and a few of its tenants aren’t financially sturdy, the corporate’s publicity to a rising phase of healthcare mixed with a excessive dividend yield, make the inventory a recession-resistant purchase.

High REIT #6: Revolutionary Industrial Properties (IIPR)

Revolutionary Industrial Properties, Inc. is a single-use “specialty REIT” that solely focuses on proudly owning properties used for the cultivation and manufacturing of marijuana. As a result of the business is within the midst of a authorized transition, there are constraints on capital out there to companies engaged within the marijuana enterprise. IIPR owns 69 properties in 18 states.

Having the lucky standing as the one publicly traded marijuana REIT within the US has led to beautiful returns, and development.

Supply: Investor Presentation

Income greater than doubled within the 2021 first quarter, in contrast with the identical quarter final yr. Adjusted funds from operation (AFFO) elevated 31.2% year-over-year.

IIPR’s development has translated into increased dividends as effectively. In 2020, IIPR declared dividends totaling $4.47 per share, a 58% enhance from 2019. The corporate once more elevated its dividend on March fifteenth by 6.5%. IIPR has a 3.1% yield proper now.

IIPR is a high-risk, high-reward REIT because of the volatility and early stage of the marijuana business. However the development potential is noteworthy, which may enormously reward shareholders over the long-term. IIPR is certainly geared towards REIT buyers trying extra for development than stability, and buyers ought to intently monitor the corporate’s monetary reviews shifting ahead.

High REIT #5: W.P. Carey (WPC)

W.P. Carey is a business actual property targeted REIT that operates two segments: actual property possession and funding administration. The REIT operates greater than 1,200 single tenant properties on a internet lease foundation, throughout the US and Northern and Western Europe. Its asset administration enterprise has AUM of roughly $2.8 billion.

W.P. Carey has a extremely diversified actual property property portfolio throughout a number of numerous business teams.

Supply: Investor Presentation

Within the 2021 first quarter, revenue elevated 0.7% year-over-year to $311.2 million. Portfolio occupancy was 98.3%. AFFO for the 2021 first quarter was $1.22 per diluted share, down 2.4% year-over-year. W.P. Carey additionally up to date its full-year steering, and now expects AFFO between $4.87 and $4.97 per diluted share. We count on 3.5% annual FFO-per-share development going ahead.

W. P. Carey generated FFO-per-share development at a price of 6% yearly between 2009 and 2019, which was a really stable development price for an actual property funding belief. The expansion price has slowed down through the years, as W. P. Carey’s FFO-per-share development price has averaged simply 3% between 2014 and 2018. Nonetheless, it is a respectable development price, and we count on an analogous development price of three%-4% yearly going ahead.

Development is fueled by investments in new properties. Since 2012, the REIT invested greater than $10 billion into new belongings by both buying total REITs or by way of single-asset/portfolio purchases. Plus, because of the defensive nature of its enterprise and a powerful efficiency throughout previous recessions, we imagine that W.P. Carey will navigate the coronavirus disaster.

W.P. Carey has an funding grade credit standing of BBB from Normal & Poor’s. It has a reasonably low stage of maturities ($768 million) by way of 2022. It additionally has an extended historical past of steady dividend development, having elevated its dividend yearly since 1998.

High REIT #4: STAG Industrial, Inc. (STAG)

STAG Industrial is the one pure-play industrial REIT energetic throughout your complete home industrial actual property market. It’s targeted on single-tenant industrial properties and has ~450 buildings throughout 38 states in the USA.

As per the most recent information, 55% of the tenants are publicly rated and 33% of the tenants are rated “funding grade.” The corporate usually does enterprise with established tenants to scale back threat. It additionally pursues broad geographic and tenant diversification to additional scale back threat.

STAG has an added benefit because of the firm’s publicity to e-commerce properties, which provides it entry to a key development phase in actual property.

Supply: Investor Presentation

Within the 2021 first quarter, STAG grew core FFO-per-share by 4.3% year-over-year. Core FFO of $79.8 million for the primary quarter of 2021 elevated 13% from 70.6 million within the year-ago quarter.

STAG Industrial is going through a headwind because of the recession brought on by the pandemic. Nonetheless, the impact of the pandemic on the REIT has been restricted to date due to the excessive credit score profile of its tenants. It’s exceptional that the REIT collected 99.6% of its base rental billings in 2020.

The coronavirus has damage transport and by extension the commercial REIT sector. Moreover, the commercial sector is usually pretty cyclical and due to this fact suffers throughout recessions. Nonetheless, STAG invests in capital tasks that allow it to proceed rising the portfolio, and its money circulation, no matter market situations. Moreover, it solely owns ~0.5% of the belongings in its goal universe, giving it an infinite development runway.

The corporate lately notified buyers that tenants which have requested hire reduction equal to only ~1% of annual base hire, a promising determine that signifies STAG is holding up comparatively effectively through the coronavirus disaster. The corporate has additionally paused acquisitions to protect money on this unsure setting.

To date, STAG’s key monetary metrics are holding up effectively. Excessive occupancy and hire assortment bodes effectively for the sustainability of the corporate’s dividend payout. STAG has a horny yield above 4%.

High REIT #3: SL Inexperienced Realty (SLG)

SL Inexperienced is an built-in REIT that’s targeted on buying, managing, and maximizing the worth of Manhattan business properties. It’s Manhattan’s largest workplace landlord, and at present owns 84 buildings totaling 38 million sq. toes.

Supply: Investor Presentation

In late April, SLG reported (4/21/2021) monetary outcomes for the primary quarter of fiscal 2021. Its same-store internet working earnings decreased -1.4% over the prior yr’s quarter however its occupancy price improved from 93.4% on the finish of the earlier quarter to 94.2%. Its funds from operations (FFO) per share decreased -17% over the prior yr’s quarter, from $2.08 to $1.73, primarily resulting from asset divestments.

SLG has been considerably affected by the coronavirus disaster, which has precipitated a recession and thus has damage a number of firms which are tenants of SLG. Nonetheless, SLG advantages from dependable development in rental charges in probably the most common business areas on the planet, Manhattan. The REIT pursues development by buying enticing properties and elevating rental charges in its current properties. It additionally indicators multi-year contracts (7-15 years) with its tenants so as to safe dependable money flows.

Because of the impact of the pandemic on its enterprise, funds from operations have stumbled this yr however they’ve remained pretty resilient. We count on SLG to develop its funds from operations per share at a 3.0% common annual price over the following 5 years.

Because of its monetary energy, the REIT can endure the continuing disaster and emerge stronger each time the pandemic subsides. It may additionally preserve its dividend, which is well-covered with a wholesome payout ratio of 56% anticipated for 2021.

High REIT #2: Essex Property Belief (ESS)

Essex Property Belief invests in west coast multi-family residential proprieties the place it engages in growth, redevelopment, administration and acquisition of house communities and some different choose properties. Roughly 83% of Essex’s internet working earnings is derived from California, with the remaining 17% from Seattle. Essex has possession pursuits in 246 house communities consisting of over 60,000 house houses.

Supply: Investor Presentation

On April 27th, 2021 Essex reported first quarter outcomes. Core FFO–per–diluted share declined by 12% to $3.07 throughout Q1. Identical–property gross income fell by 8.1% and similar–property internet working earnings fell by 12.3% from Q1 2020. Three house communities had been offered throughout the quarter for a contract worth of $275.5 million. The corporate additionally issued $450 million of seven–yr senior unsecured notes due in 2028. In the meantime, Essex reaffirmed its full–yr steering for core FFO per share steering in a spread of $11.86 to $12.46.

We count on ~4% annual FFO-per-share development over the following 5 years. Development will come from the favorable economics of Essex’s geographic focus. The U.S. West Coast has excessive financial output (California and Washington mixed would have the Fifth-highest GDP on the planet) in addition to restricted provide.

Essex Property Belief has achieved spectacular development for a number of many years, on the again of the sturdy west coast property market. We count on Essex to bounce again shortly because of the premier areas by which it owns properties. A powerful stability sheet additionally helps the corporate attain its development aims. The belief has a stable BBB+ credit standing which is excessive for a REIT.

The inventory has a virtually 3% dividend yield, and the corporate has elevated its dividend for 27 consecutive years, inserting it on the unique checklist of Dividend Aristocrats. Its most up-to-date dividend enhance was a 0.6% elevate in February 2021.

Subsequently, Essex earns a excessive place on the checklist resulting from its lengthy dividend historical past of annual will increase, and development potential. It additionally has a really excessive stage of dividend security.

High REIT #1: Realty Earnings (O)

Realty Earnings is a retail-focused REIT that owns greater than 6,500 properties. Realty Earnings owns retail properties that aren’t a part of a wider retail growth (resembling a mall), however as an alternative are standalone properties. Which means that the properties are viable for a lot of totally different tenants, together with authorities providers, healthcare providers, and leisure. Realty Earnings is a large-cap inventory with a market capitalization above $24 billion.

The corporate’s lengthy historical past of dividend funds and will increase is because of its high-quality enterprise mannequin and diversified property portfolio.

Supply: Investor Presentation

In the newest quarter, Realty Earnings beat analyst estimates on each income and FFO-per-share. Income elevated 6.8% from the identical quarter final yr, resulting from property acquisitions and hire will increase. Adjusted FFO-per-share declined 2.2% resulting from the next share rely.

Future development stays doubtless, as the corporate’s acquisition pipeline is strong. Final quarter, Realty Earnings invested $1.03 billion in properties and properties beneath growth or growth, together with $403 million in U.Ok. properties.

Realty Earnings leaps to the highest spot on the checklist, due to its extremely spectacular dividend historical past, which is unmatched among the many different month-to-month dividend shares. Realty Earnings has declared over 600 consecutive month-to-month dividend funds with out interruption, and has elevated its dividend over 100 occasions since its preliminary public providing in 1994. Like Essex, Realty Earnings is a member of the Dividend Aristocrats.

In December, Realty Earnings raised its dividend by 0.2%, bringing the whole dividend development price to ~3% for 2020. The corporate’s lengthy historical past of dividend funds and will increase is because of its high-quality enterprise mannequin and diversified property portfolio. These qualities make it probably the most enticing REIT for buyers on the lookout for a mixture of dividend yield, dividend development, and dividend security.

Closing Ideas

The Full REIT Spreadsheet Checklist incorporates a listing of all publicly-traded Actual Property Funding Trusts.

Bonus: Take heed to our interview with Brad Thomas on The Positive Investing Podcast about clever REIT investing within the beneath video.

Nonetheless, this database is actually not the one place to seek out high-quality dividend shares buying and selling at truthful or higher costs.

The truth is, the most effective strategies to seek out high-quality dividend shares is on the lookout for shares with lengthy histories of steadily rising dividend funds. Corporations which have elevated their payouts by way of many market cycles are extremely more likely to proceed doing so for a very long time to return.

You may see extra high-quality dividend shares within the following Positive Dividend databases, every based mostly on lengthy streaks of steadily rising dividend funds:

Alternatively, one other excellent spot to search for high-quality enterprise is contained in the portfolios of extremely profitable buyers. By analyzing the portfolios of legendary buyers working multi-billion greenback funding portfolios, we’re in a position to not directly profit from their million-dollar analysis budgets and private investing experience.

To that finish, Positive Dividend has created the next two articles:

You may additionally be seeking to create a extremely personalized dividend earnings stream to pay for all times’s bills.

The next lists present helpful info on excessive dividend shares and shares that pay month-to-month dividends: