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10 of the Best REITs to Buy for 2024

CEO Khai Intela
2023 has been a challenging year for the Real Estate sector. However, with the latest market upswing, the sector has finally entered positive territory. Despite this, Real Estate Investment Trusts (REITs) have struggled due to...

2023 has been a challenging year for the Real Estate sector. However, with the latest market upswing, the sector has finally entered positive territory. Despite this, Real Estate Investment Trusts (REITs) have struggled due to rising interest rates. But with inflation decreasing and the expectation of interest rate cuts in 2024, REITs are starting to gain momentum.

In light of this, we will be exploring 10 of the best REITs to consider for 2024.

REIT #1 - Realty Income Corporation (O)

Let's begin with the gold standard in the REIT space, Realty Income Corporation, often referred to as "The Monthly Dividend Company." Realty Income operates as a net lease REIT and boasts a market cap of $39 billion. The stock has fallen 16% in the past 12 months.

Realty Income owns a portfolio of more than 13,250 properties, with a pending acquisition of Spirit Realty Capital, Inc. Its properties have a high occupancy rate of 98.8% as of the latest quarter.

The company primarily focuses on the retail sector, accounting for nearly 83% of annualized base rent, followed by industrial, gaming, and other sectors. Realty Income is one of three REITs on the dividend aristocrat list, offering a current dividend yield of 5.7%.

In terms of valuation, analysts forecast an AFFO (Adjusted Funds from Operations) of $4.16 per share in 2024, presenting a good value proposition.

REIT #2 - VICI Properties Inc. (VICI)

VICI Properties is a REIT that stands out as the largest landlord on the Las Vegas strip. The company has a market cap of $32 billion, and its stock has fallen nearly 10% in the past 12 months.

VICI owns high-quality assets, including renowned properties like Caesars Palace, MGM Grand, and Park MGM. These assets have seen a 100% collection rate throughout the pandemic, indicating their resilience.

With a dividend yield of 5.4% and an average dividend growth rate of 17%, VICI offers attractive income potential. Analysts project an AFFO of $2.25 per share in 2024, making this REIT an appealing value play.

REIT #3 - Agree Realty Corporation (ADC)

Agree Realty Corporation is often considered the younger sibling of Realty Income. Both companies operate as net lease REITs within the retail sector. Agree Realty has a market cap of $6 billion, with shares declining by nearly 20% in the past 12 months.

Agree Realty has a solid track record, generating a 26% total shareholder return over the past five years. Its portfolio consists of grocery, home improvement, and auto service properties, with Walmart, Tractor Supply Company, and Dollar General as top tenants.

With consistent dividend growth for the past ten years, Agree Realty's current dividend yield stands at 5%. Analysts expect an AFFO of $4.11 per share in 2024, presenting an attractive valuation opportunity.

REIT #4 - Prologis, Inc. (PLD)

Prologis is the largest industrial and warehouse REIT, benefiting from the growth of e-commerce. The company has a market cap of $112 billion, with its stock remaining relatively flat over the past 12 months.

Prologis provides the real estate infrastructure for companies like Amazon and Shopify. With e-commerce sales projected to grow, Prologis is well-positioned for future expansion.

The REIT offers a dividend yield of 2.9% with a five-year dividend growth rate of 12.5%. Analysts project an AFFO of $4.52 per share in 2024, presenting an appealing investment opportunity.

REIT #5 - Alexandria Real Estate Equities, Inc. (ARE)

Alexandria Real Estate Equities has been an interesting and misunderstood REIT over the years. Unlike traditional office REITs, Alexandria caters to the pharmaceutical and biotech sectors. The company has a market cap of $21 billion, and its stock has fallen 20% in the past 12 months.

With exposure to the growing demand for research and medical campuses, Alexandria Real Estate offers a unique proposition. The REIT's dividend yield stands at 4.25%, and analysts project an AFFO of $7.59 per share in 2024.

REIT #6 - Extra Space Storage Inc. (EXR)

Extra Space Storage is one of the largest self-storage REITs in the market. The company has a market cap of $30 billion, with shares declining over 12% in the past year.

Given Americans' propensity for hoarding, the demand for self-storage remains strong. Extra Space Storage has over 2.5 million storage units across the United States.

The REIT has been a strong performer with consistent dividend growth. Currently, it offers a dividend yield of 4.7%. Analysts project an AFFO of $7.96 per share in 2024, making Extra Space Storage an attractive investment.

REIT #7 - American Assets Trust, Inc. (AAT)

American Assets Trust offers a diversified portfolio with exposure to retail, apartments, and office properties. The company has a market cap of under $2 billion, with shares declining 20% in the past year.

With a strong presence along the West Coast, American Assets Trust provides a compelling value proposition. The REIT offers a dividend yield of over 6% and an AFFO multiple of just 12.4x.

REIT #8 - Crown Castle Inc. (CCI)

Crown Castle, a leading provider of communication infrastructure, has faced challenges due to higher interest rates and increased competition. Nonetheless, the company has a market cap of $50 billion, and its stock is down 15% in the past year.

Crown Castle owns and leases cell towers, small cells, and fiber communication operations. Despite recent scrutiny, demand for their infrastructure from major carriers remains strong.

With a dividend yield of 5.4% and an average dividend growth rate of 8%, Crown Castle offers an attractive income opportunity. Analysts project an AFFO of $6.93 per share in 2024.

REIT #9 - Mid-America Apartment Communities, Inc. (MAA)

Mid-America Apartment Communities, one of the largest apartment REITs, has seen its stock decline over 20% in the past year. The company has a market cap of $15 billion.

Despite challenges from high interest rates and slowing rental growth, Mid-America Apartment Communities has consistently generated higher Core FFO (Funds from Operations). The REIT offers a dividend yield of 4.4% and an AFFO multiple below its historical average.

REIT #10 - NNN REIT, Inc. (NNN)

NNN REIT, formerly known as National Retail Properties, is a net lease retail REIT that has been overshadowed by Realty Income. With a market cap of $7 billion, NNN REIT has seen its stock decline 10% in the past year.

The REIT owns a diverse portfolio of over 3,500 properties across various trade lines. With 34 years of dividend increases, NNN REIT offers a dividend yield of 5.55%.

Analysts expect an AFFO of $3.32 per share in 2024, presenting an attractive valuation opportunity.

Conclusion

REITs have faced challenges due to rising interest rates, but with favorable market conditions expected in 2024, they offer attractive investment opportunities. Each of the 10 REITs mentioned provides unique benefits and value propositions. Whether you're looking for consistent dividends or potential growth, these REITs are worth considering for your portfolio. Which one stands out to you the most? Let us know in the comments below.

Disclosure: This article is for informational purposes only and should not be construed as investment advice. It is important to conduct thorough research and seek professional guidance before making investment decisions.

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