First Published on May 8th, 2023 by Bob Ciura for SureDividend. Spreadsheet data updated daily
Real estate investment trusts – or REITs, for short – can be fantastic securities for generating meaningful portfolio income. REITs widely offer higher dividend yields than the average stock.
While the S&P 500 Index on average yields less than 2% right now, it is relatively easy to find REITs with dividend yields of 5% or higher.
The following downloadable REIT list contains a comprehensive list of U.S. Real Estate Investment Trusts, along with metrics that matter including:
- •Stock price
- •Dividend yield
- •Market capitalization
- •5-year beta
You can download your free 200+ REIT list (along with important financial metrics like dividend yields and payout ratios) by clicking on the link below:
In addition to the downloadable Excel sheet of all REITs, this article discusses why income investors should pay particularly close attention to this asset class. And, we also include our top 7 REITs today based on expected total returns.
Table Of Contents
In addition to the full downloadable Excel spreadsheet, this article covers our top 7 REITs today, as ranked using expected total returns from The Sure Analysis Research Database.
The table of contents below allows for easy navigation.
- •How To Use The REIT List
- •Why Invest In REITs?
- •REIT Financial Metrics
- •The Top 7 REITs Today #7: Piedmont Office Realty Trust (PDM) #6: City Office REIT (CIO) #5: Office Properties Income Trust (OPI) #4: Uniti Group (UNIT) #3: Brandywine Realty Trust (BDN) #2: SL Green Realty (SLG) #1: Innovative Industrial Properties Trust (IIPR)
How To Use The REIT List To Find Dividend Stock Ideas
REITs give investors the ability to experience the economic benefits associated with real estate ownership without the hassle of being a landlord in the traditional sense.
Because of the monthly rental cash flows generated by REITs, these securities are well-suited to investors that aim to generate income from their investment portfolios. Accordingly, dividend yield will be the primary metric of interest for many REIT investors.
For those unfamiliar with Microsoft Excel, the following images show how to filter for REITs with dividend yields between 5% and 7% using the ‘filter’ function of Excel.
Click here to download your Complete REIT Excel Spreadsheet List now. Keep reading this article to learn more.
Step 1: Download the Complete REIT Excel Spreadsheet List at the link above.
Step 2: Click on the filter icon at the top of the ‘Dividend Yield’ column in the Complete REIT Excel Spreadsheet List.
Step 3: Use the filter functions ‘Greater Than or Equal To’ and ‘Less Than or Equal To’ along with the numbers 0.05 ad 0.07 to display REITs with dividend yields between 5% and 7%.
This will help to eliminate any REITs with exceptionally high (and perhaps unsustainable) dividend yields.
Also, click on ‘Descending’ at the top of the filter window to list the REITs with the highest dividend yields at the top of the spreadsheet.
Now that you have the tools to identify high-quality REITs, the next section will show some of the benefits of owning this asset class in a diversified investment portfolio.
Why Invest in REITs?
REITs are, by design, a fantastic asset class for investors looking to generate income.
Thus, one of the primary benefits of investing in these securities is their high dividend yields.
The currently high dividend yields of REITs is not an isolated occurrence. In fact, this asset class has traded at a higher dividend yield than the S&P 500 for decades.
Related: Dividend investing versus real estate investing.
The high dividend yields of REITs are due to the regulatory implications of doing business as a real estate investment trust.
In exchange for listing as a REIT, these trusts must pay out at least 90% of their net income as dividend payments to their unitholders (REITs trade as units, not shares).
Sometimes you will see a payout ratio of less than 90% for a REIT, and that is likely because they are using funds from operations, not net income, in the denominator for REIT payout ratios (more on that later).
REIT Financial Metrics
REITs run unique business models. More than the vast majority of other business types, they are primarily involved in the ownership of long-lived assets.
From an accounting perspective, this means that REITs incur significantnon-cash depreciation and amortization expenses.
How does this affect the bottom line of REITs?
Depreciation and amortization expenses reduce a company’s net income, which means that sometimes a REIT’s dividend will be higher than its net income, even though its dividends are safe based on cash flow.
Related: How To Value REITs
To give a better sense of financial performance and dividend safety, REITs eventually developed the financial metric funds from operations, or FFO.
Just like earnings, FFO can be reported on a per-unit basis, giving FFO/unit – the rough equivalent of earnings-per-share for a REIT.
FFO is determined by taking net income and adding back various non-cash charges that are seen to artificially impair a REIT’s perceived ability to pay its dividend.
For an example of how FFO is calculated, consider the following net income-to-FFO reconciliation from Realty Income (O), one of the largest and most popular REIT securities.
Source: Realty Income Annual Report
In 2022, net income was $869 million while FFO available to stockholders was above $2.4 billion, a sizable difference between the two metrics. This shows the profound effect that depreciation and amortization can have on the GAAP financial performance of real estate investment trusts.
The Top 7 REITs Today
Below we have ranked our top 7 REITs today based on expected total returns.
Expected total returns are in turn made up from dividend yield, expected growth on a per unit basis, and valuation multiple changes. Expected total return investing takes into account income (dividend yield), growth, andvalue.
Note: The REITs below have not been vetted for safety. These are high expected total return securities, but they may come with elevated risks.
We encourage investors to fully consider the risk/reward profile of these investments.
For the Top 10 REITs each month with 4%+ dividend yields, based on expected total returns and safety, see our Top 10 REITs service.
Top REIT #7: Piedmont Office Realty Trust (PDM)
- •Expected Total Return: 24.8%
- •Dividend Yield: 12.7%
Piedmont Office Realty Trust, Inc. owns, manages, develops, redevelops, and operates high-quality office properties located primarily in sub-markets within seven major Eastern U.S. office markets.
The REIT derives most of its revenues from U.S. government entities, business services companies, and financial institutions in the Sunbelt region. PDM is fully integrated and self-managed.
Source: Investor Presentation
On February 8th, 2023, Piedmont released fourth quarter and full year 2022 results. The company reported core funds from operations (FFO) of $0.50 per share for the quarter, a penny short of last year’s results in the fourth quarter.
PDM saw a 1.6% increase in same store net operating income on a cash basis and a -0.7% decrease on an accrual basis year-over-year for the quarter ended December 31st, 2022. The company leased 433,000 square feet in the quarter, including 164,000 of new tenant leasing.
For the full year, Piedmont achieved FFO per share of $2.00, which surpassed 2021’s results by three cents (+1.5%).
As of December 31st, 2022, Piedmont’s average net debt-to-Core EBITDA was 6.0 for the fourth quarter on an annualized basis, and the debt-to-gross assets ratio was 37.6%. Piedmont expects 2023 core funds from operations in the range of $1.80 to $1.90 per share.
Click here to download our most recent Sure Analysis report on Piedmont (preview of page 1 of 3 shown below):
Top REIT #6: City Office REIT (CIO)
- •Expected Total Return: 26.1%
- •Dividend Yield: 15.4%
City Office REIT is an internally-managed real estate investment trust focused on owning, operating, and acquiring high-quality office properties located in “18-hour cities” in the Southern and Western United States.
Its target markets possess a number of attractive demographic and employment characteristics, which the trust believes will lead to capital appreciation and growth in rental income at its properties.
Source: Investor Presentation
The company was able to grow its funds from operations-per-share in both 2021 and 2022, which was a strong feat. While rising interest rates are forecasted to be a headwind in the current year, City Office should continue to cover the dividend easily, as we are forecasting a payout ratio of 61% for the company’s current dividend of $0.80 per share per year.
City Office currently trades with a very high dividend yield of 14.5%, which is very strong. Since we are also forecasting some minor funds from operations growth over the coming years, and since we believe that City Office has upside potential towards what we deem fair value, the expected total return is north of 20% per year over the coming five years.
Click here to download our most recent Sure Analysis report on Office Properties (CIO) (preview of page 1 of 3 shown below):
Top REIT #5: Office Properties Income Trust (OPI)
- •Expected Total Return: 27.5%
- •Dividend Yield: 15.3%
Office Properties Income Trust is a REIT that currently owns more than 160 buildings, which are primarily leased to single tenants with high credit quality. The REIT’s portfolio currently has a 90.6% occupancy rate and an average building age of 17 years. The U.S. Government is the largest tenant of OPI, as it represents 20% of the annual rental income of the REIT.
Source: Investor Presentation
In mid-February, OPI reported (2/15/2023) financial results for the fourth quarter of fiscal 2022. The occupancy rate edged down sequentially from 90.7% to 90.6% and normalized funds from operations (FFO) per share dipped -6% over the prior year’s quarter, from $1.20 to $1.13.
Due to asset sales and the expiration of some leases, FFO per share have decreased -21% in total in the last three years. More than 90% of the debt of OPI is at fixed rates but we expect interest expense to increase this year due to high interest rates.
Click here to download our most recent Sure Analysis report on OPI (preview of page 1 of 3 shown below):
Top REIT #4: Uniti Group Inc. (UNIT)
- •Expected Total Return: 29.3%
- •Dividend Yield: 15.7%
Uniti Group is a Real Estate Investment Trust (i.e., REIT) that focuses on acquiring, constructing, and leasing out communications infrastructure in the United States. In particular, it owns millions of miles of fiber strand along with other communications real estate.
On February 24th, Uniti Group reported Q4 results. Consolidated revenues were $283.7 million, down by 3.2% year-over-year. The REIT generated $0.44 per share in AFFO, beating analyst consensus estimates by $0.06. Furthermore, net income per share was $0.13. The company guided for 2023 revenue of between $1.154 billion and $1.174 billion, in-line with consensus estimates of $1.16 billion.
It is primarily working to drive this growth through refinancing its debt at significantly lower rates in order to generate increased cash flow from existing revenue streams while also leasing up its under-utilized assets. In the near-term, however, higher interest rates are delaying this tailwind, resulting in the large decline in AFFO per share expected in 2023.
By adding leasing to its assets it can generate extremely high returns on investment capital as additional customers require minimal additional capital expenditures, but bring in strong cash flows.
Click here to download our most recent Sure Analysis report on UNIT (preview of page 1 of 3 shown below):
Top REIT #3: Brandywine Realty Trust (BDN)
- •Expected Total Return: 30.3%
- •Dividend Yield: 19.7%
Brandywine Realty owns, develops, leases and manages an urban town center and transit-oriented portfolio which includes 163 properties in Philadelphia, Austin and Washington, D.C. The REIT has a market capitalization of $1.1 billion and generates 74% of its operating income in Philadelphia, 22% of its operating income in Austin and the remaining 4% in Washington, D.C.
As Brandywine Realty Trust generates the vast portion of its operating income in Philadelphia and Austin, it is worth noting the advantages of these two areas. According to official reports, Philadelphia has the highest growth rate of highly educated citizens since 2008 while Austin is the fastest-growing metropolitan area, the best place to start business and it has retrieved all the jobs lost due to the pandemic.
In early February, Brandywine Realty Trust reported (2/1/23) financial results for the fourth quarter of fiscal 2022. Its occupancy slipped sequentially from 90.8% to 89.8% and its funds from operations (FFO) per share dipped from $0.36 to $0.32, in line with the analysts’ consensus. This was the first quarter in which the impact of rising interest rates on interest expense was evident.
As the REIT faces debt maturities, it has to issue new debt at high interest rates. Due to this headwind and its high debt load, the stock has plunged 47% over the last 12 months, to a 13-year low. Due to high interest expense, management provided guidance for FFO per share of $1.12-$1.20 in 2023.
Click here to download our most recent Sure Analysis report on BDN (preview of page 1 of 3 shown below):
Top REIT #2: SL Green Realty (SLG)
- •Expected Total Return: 30.5%
- •Dividend Yield: 14.4%
SL Green Realty Corp was formed in 1980. It is an integrated real estate investment trust (REIT) that is focused on acquiring, managing, and maximizing the value of Manhattan commercial properties.
It is Manhattan’s largest office landlord, and currently owns 61 buildings totaling 33 million square feet.
Source: Investor Presentation
In late January, SLG reported (1/25/2023) financial results for the fourth quarter of fiscal 2022. Its same-store net operating income rose 3.3% over the prior year’s quarter but its occupancy rate dipped sequentially from 92.1% to 91.2%.
Given also the negative effect of some assets sales, its funds from operations (FFO) per share decreased -3% over the prior year’s quarter, from $1.52 to $1.47. The REIT missed the analysts’ consensus by $0.01.
Click here to download our most recent Sure Analysis report on SLG (preview of page 1 of 3 shown below):
Top REIT #1: Innovative Industrial Properties (IIPR)
- •Expected Total Return: 32.3%
- •Dividend Yield: 10.4%
Innovative Industrial Properties, Inc. is a single-use “specialty REIT” that exclusively focuses on owning properties used for the cultivation and production of marijuana. Because the industry is in the midst of a legal transition, there are constraints on capital available to businesses engaged in the marijuana business.
Related: The Best Marijuana Stocks: List of 100+ Marijuana Industry Companies
The ongoing legalization of cannabis in the US has led to stunning returns and portfolio growth. The $2.8 billion REIT owns ~111 properties in 19 states. Amid the cannabis boom over the past few years, as well as its exclusivity in terms of the listing giving the trust access to public markets, Innovate Industrial Properties remains one of the fastest-growing REITs in the world.
Source: Investor Presentation
On February 27th, 2023, Innovative Industrial announced its Q4-2022 and full-year earnings for the period ending December 31st, 2022. For the quarter, revenues and normalized AFFO/share were $70.5 million and $2.12, an increase of 19.5% and 14.6%, respectively. The company’s growth was primarily driven by the nine properties that were acquired throughout the year. Contractual rental escalations at certain properties also boosted results.
As of December 31st, 2022, 100% of IIPR’s properties were leased with a weighted average remaining lease term of approximately 15.3 years. That’s two months less than the previous quarter’s WALE, but it is still a very impressive total. Unfortunately, the company collected 94% during the quarter due to a few of its tenants going out of business.
Click here to download our most recent Sure Analysis report on IIPR (preview of page 1 of 3 shown below).
Final Thoughts
The REIT Spreadsheet list in this article contains a list of publicly-traded Real Estate Investment Trusts.
However, this database is certainly not the only place to find high-quality dividend stocks trading at fair or better prices.
In fact, one of the best methods to find high-quality dividend stocks is looking for stocks with long histories of steadily rising dividend payments. Companies that have increased their payouts through many market cycles are highly likely to continue doing so for a long time to come.
This article was first published by Bob Ciura for Sure Dividend
Sure dividend helps individual investors build high-quality dividend growth portfolios for the long run. The goal is financial freedom through an investment portfolio that pays rising dividend income over time. To this end, Sure Dividend provides a great deal of free information.
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