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Real Estate Investment Trusts (REITs) are a type of investment vehicle that own and operate income-producing real estate properties. They offer a way for investors to gain exposure to the real estate market without having to purchase and manage properties themselves. REITs are required by law to distribute at least 90% of their taxable income to shareholders in the form of dividends, making them a popular income-generating investment option.
Substantial valuation spreads have emerged between REITs and the rest of the market, making them an attractive investment opportunity. Historically, REITs have outperformed other asset classes during periods of rising inflation and interest rates. As the economy continues to recover from the pandemic, inflation and interest rates are expected to increase, which could lead to significant outperformance ahead for REITs.
Barron's has identified the 10 most sustainable U.S. real estate investment trusts with the help of Calvert Research and Management. These REITs have a strong commitment to environmental, social, and governance (ESG) issues, making them a socially responsible investment option.
Minto Apartment Real Estate Investment Trust (MI.UN) announced that Minto Properties Inc. has agreed to acquire a portfolio of properties for $200 million. The acquisition will increase the REIT's portfolio by 1,200 suites in Toronto, Ottawa, and London, Ontario.
Marwest Apartment Real Estate Investment Trust (MAR.UN) reported financial results for the year ended December 31, 2022. The REIT's net income increased by 10.6% compared to the previous year, and it generated funds from operations of $0.65 per unit.
The addition of Blackstone Real Estate Income Trust (BREIT) to LODAS Markets' secondary marketplace offers new options for investor liquidity beyond redemptions. Investors can now buy and sell shares of BREIT on the secondary market, providing them with greater flexibility and liquidity.
Stock prices of Brookfield DTLA and Hudson Pacific have fallen to record lows, presenting buying opportunities for investors. These REITs own properties in the Los Angeles market, which has been hit hard by the pandemic. However, as the economy recovers and people return to work, these properties are expected to see increased demand.
REITs have sold off heavily in recent months, creating historic buying opportunities for investors. Two top REIT picks to consider are Welltower Inc. (WELL) and Prologis Inc. (PLD). Welltower specializes in healthcare real estate, while Prologis focuses on logistics properties.
With smaller banks likely to pull back from commercial real estate lending, REITs could pick up the slack. REITs have the advantage of being able to access capital markets to finance their properties, making them an attractive option for borrowers. Currently, REITs are trading at a discount to their net asset value, making them a cheap investment option.
Investors in Farmland Properties Inc. (FPI) have been disappointed to see the REIT continuing to trend downward. FPI owns farmland and other agricultural properties, which have been impacted by the pandemic and trade disputes. However, as the economy recovers and trade tensions ease, FPI could see improved performance.
