Updated on January 12th, 2024 by Bob Ciura. Spreadsheet data updated daily.
Real estate investment trusts, or REITs, offer a fantastic opportunity for investors to generate significant income from their portfolios. Unlike traditional stocks, REITs typically provide higher dividend yields, making them an attractive option for income investors.
While the S&P 500 Index currently yields less than 2%, it's relatively easy to find REITs with dividend yields of 5% or higher. To make it easier for you to explore and analyze various REIT options in the market, we have created a comprehensive list of U.S. Real Estate Investment Trusts. This list includes important financial metrics such as stock price, dividend yield, market capitalization, and 5-year beta.
How to Use the REIT List to Find Dividend Stock Ideas
REITs allow investors to benefit from real estate ownership without the hassle of being a landlord. These securities are particularly well-suited for those aiming to generate income from their investment portfolios. As such, the primary metric of interest for many REIT investors is the dividend yield.
If you're unfamiliar with Microsoft Excel, don't worry. We've included step-by-step instructions on how to filter for high dividend REITs with dividend yields between 5% and 7%. This will help you identify high-quality REITs while eliminating those with exceptionally high and potentially unsustainable dividend yields.
First, download the complete REIT Excel spreadsheet list from the provided link. Then, follow the simple instructions outlined with images to filter for REITs within your desired dividend yield range. By doing so, you'll be able to identify the top REITs that meet your investment goals.
Why Invest in REITs?
REITs are an excellent asset class for investors looking to generate income. One of their primary benefits is their high dividend yields. This is not an isolated occurrence; in fact, REITs have historically traded at higher dividend yields than the S&P 500.
The high dividend yields of REITs are a result of the regulatory requirements these trusts must follow. To qualify as a REIT, they must distribute at least 90% of their net income as dividends to their unitholders. This structure ensures that investors can enjoy a steady stream of income from their REIT investments.
REIT Financial Metrics
REITs operate under unique business models, primarily involving the ownership of long-lived assets. This leads to significant non-cash depreciation and amortization expenses, which impact their bottom line.
To better understand a REIT's financial performance and dividend safety, they developed a financial metric called funds from operations (FFO). FFO reflects the company's net income adjusted for non-cash charges that may impair a REIT's ability to sustain its dividend payments.
For instance, Realty Income, one of the largest and most popular REIT securities, reported a significant difference between its net income and FFO. These disparities highlight how depreciation and amortization expenses can affect the GAAP financial performance of REITs.
Top 7 REITs Today
Based on expected total returns, we have ranked the top 7 REITs today. These rankings consider dividend yield, expected growth on a per unit basis, and valuation multiple changes. It's worth noting that these REITs carry heightened risks, and we encourage investors to thoroughly consider their risk/reward profile before investing.
Here are the top 7 REITs:
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Office Properties Income Trust (OPI)
- Expected Total Return: 39.4%
- Dividend Yield: 25.8%
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Clipper Properties (CLPR)
- Expected Total Return: 21.3%
- Dividend Yield: 7.3%
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Brandywine Realty Trust (BDN)
- Expected Total Return: 19.8%
- Dividend Yield: 12.8%
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Medical Properties Trust (MPW)
- Expected Total Return: 17.0%
- Dividend Yield: 8.8%
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Douglas Emmett Realty (DEI)
- Expected Total Return: 17.6%
- Dividend Yield: 5.4%
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UMH Properties (UMH)
- Expected Total Return: 16.8%
- Dividend Yield: 5.2%
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American Assets Trust (AAT)
- Expected Total Return: 16.5%
- Dividend Yield: 5.6%
Each of these REITs offers substantial potential for returns, but it's crucial to conduct thorough research and understand the associated risks.
Final Thoughts
Our comprehensive REIT spreadsheet list provides you with a starting point for exploring the world of real estate investment trusts. However, it's important to note that this database isn't the only place to find high-quality dividend stocks. Companies with long histories of steadily rising dividend payments are also excellent options for income-focused investors.
To uncover more high-quality dividend stocks, we recommend exploring our Dividend Kings List, Dividend Aristocrats List, and Blue Chip Stocks List. Additionally, if you're looking to create a customized dividend income stream, check out our Monthly Dividend Stocks List and the 20 Highest Yielding Monthly Dividend Stocks.
Remember, investing in REITs and any other securities requires careful consideration of risk and reward. Ensure you evaluate each investment opportunity thoroughly before making any decisions.