With inflation and rising interest rates creating turmoil in the economy and financial markets, these are tough times to be a consumer – or an investor.
Well, today we’re going to kill two birds with one stone . We’re going to put some of that grocery money back in your pocket and help you sleep better even as markets gyrate. The following real estate investment trusts have several things in common. First, all three derive a large chunk of their rental income from grocery stores, drug stores and other defensive businesses. Second, all pay monthly distributions that yield more than 5 per cent. Third, because their revenue comes largely from non-cyclical businesses with long-term leases, their unit prices tend to be more stable than those of some other investments.
In addition to their defensive characteristics, they also offer modest potential for growth thanks to their property development pipelines, which include retail, residential, industrial and mixed-use projects. A caveat: Developing real estate is a time-consuming and capital-intensive business. None of these REITs is likely to deliver substantial capital gains or big distribution increases in the near term. What they do offer are stable payouts that yield more than many dividend stocks. That makes them suitable candidates for investors seeking above-average income as part of a well-diversified portfolio. Remember to do your own due diligence before investing in any security.