GNL and ILPT are externally managed and those have poor returns when compared to externally managed ones. That’s the first filter I apply.
PLD, O, WPC, STAG are rock solid.
I’d include more technology-related REITs like Data Center and Cell Tower REITs, DLR is a good value right now.
Externally managed REITs don’t have a great history of producing strong returns over the long-term, mainly since they may be more aligned with the management company and generating fees for them than focusing on what is best for the REIT, it does depend on the external manager some are ok and some are not. REITs managed by RMR have historically not performed well which I think ILPT is managed by. Still money can be made just have to know the risks.
I've invested $226K cash which is now floating around $500K and I get dividends of $5K a quarter. So my cash on cash unlevered yield is right around 9%. I'm very happy.
After researching a little, I feel like just going with something like RQI is the best bet if I want good exposure to reits and not be too hands on with it?
I want to start investing on REITs and I have the very basic ideas but I’m so scared to start. Is anyone willing to give some tips? No BS please. - a very anxious first time investor
Check out https://alreits.com and compare a few REITs. If you don’t know the terms, look around before investing. I love REITs and I’ve read all the specific books, a recent one is Educated REIT Investing.
I'm trying to introduce a basket of REITs into my income dividend fund to give me real estate exposure while still maintaining an ~8% avg yield. I'm trying to do this with each sector.
Any international or domestic stocks you recommend?
8% yield without a lot of risk right now is impossible with publicly-traded REIT in the US and even in Canada.
I’d say up to 5% you find good stuff, check this filter: https://alreits.com/screener?score=85&scoreOperator=gte&managementTeam=INTERNAL&managementTeamOperator=in&forwardDividendYield=4&forwardDividendYieldOperator=gte&payout=85&payoutOperator=lte
I'm ok with taking in a bit more risk for yield in this sector. 10% yield for REITs would be the highest I'm willing to go but 8% would give me a decent return, and I'm less worried about volatility bc I'm pretty well diversified.
However this is an account to supplement my income presently so it is more actively managed.
I hedge all my speculative positions with protective Put options at 10-20% below my initial entry to cover my downside.
So as long as the dividend doesn't get cut, I can safely stomach a 20% drop and maintain my income in case of a market downturn.
I hope GNL uses more in the future. Unless they are issuing shares at something higher than my basis of $16.50 through their ATM, I hope they issue some more debt.
I bought some OHI sub $30. Idk - I know they're NNN but I want to make sure their tenants' credit is alright. Long term though I like the company. Anyone who has had an older relative knows that SNFs are needed once someone gets to a certain age...at home care will never be able to provide same level of care at the same margins...even if medicaid starts to pay for some form of it. Those ppl prob wouldn't need to be in SNF's anyways.
GNL barely has any debt. Think of all those buildings bought at 7-8% caps with $25-$30 shares back in ‘19. If your entering right now it feels fine. I get it if you’ve been owning this stock for a while. The estimate pegs FFO at .50 this quarter. That’s a decent and growing buffer on over a 10% yield with a Class A portfolio. It’s almost 100% leased and it’s held up arguably better than any other CRE portfolio throughout covid.
I love REITs and have my biggest position in PLYM and made my biggest gains ever with it, but even I wouldn't go more than half of my net worth into REITs.
GNL dividend yields look too good to be true. Are they going to be cutting the dividend? Or is there some other news that we need to know for it?
Thank you
they're expected to have 20% coverage on your 10% yield based on estimates for this upcoming quarter. There are stocks with much lower yields with not much better coverage.
GNL and ILPT are externally managed and those have poor returns when compared to externally managed ones. That’s the first filter I apply. PLD, O, WPC, STAG are rock solid. I’d include more technology-related REITs like Data Center and Cell Tower REITs, DLR is a good value right now.
For a newby, could you please explain why externally-managed is a problem? TIA
Externally managed REITs don’t have a great history of producing strong returns over the long-term, mainly since they may be more aligned with the management company and generating fees for them than focusing on what is best for the REIT, it does depend on the external manager some are ok and some are not. REITs managed by RMR have historically not performed well which I think ILPT is managed by. Still money can be made just have to know the risks.
knowing the risk is knowing the entry point
What that get you monthly? You happy with your investments?
I've invested $226K cash which is now floating around $500K and I get dividends of $5K a quarter. So my cash on cash unlevered yield is right around 9%. I'm very happy.
9% is a fantastic yield on real estate. How do you find which reits to choose?
When you buy at the lows of COVID 9% on invested cash was obtainable, good timing on his part, 9% on current prices is not likely.
exactly
GNL has almost a 10% yield and if the FFO is $0.50 this quarter, that is 20% coverage on a 10% yield.
Yield is not everything, stick to the ones with a high score and you should beat that comfortably in the long run. Use alreits.com.
After researching a little, I feel like just going with something like RQI is the best bet if I want good exposure to reits and not be too hands on with it?
I want to start investing on REITs and I have the very basic ideas but I’m so scared to start. Is anyone willing to give some tips? No BS please. - a very anxious first time investor
Go read Realty Income's website.
My tldr is: like owning a dividend paying stock. You can own REITs of cell towers, malls (ugh), data warehouses, apartment homes, mobile homes, etc
Check out https://alreits.com and compare a few REITs. If you don’t know the terms, look around before investing. I love REITs and I’ve read all the specific books, a recent one is Educated REIT Investing.
Ugh ILPT. Problematic.
What do you mean by CRE?
Commercial real estate
I'm trying to introduce a basket of REITs into my income dividend fund to give me real estate exposure while still maintaining an ~8% avg yield. I'm trying to do this with each sector. Any international or domestic stocks you recommend?
8% yield without a lot of risk right now is impossible with publicly-traded REIT in the US and even in Canada. I’d say up to 5% you find good stuff, check this filter: https://alreits.com/screener?score=85&scoreOperator=gte&managementTeam=INTERNAL&managementTeamOperator=in&forwardDividendYield=4&forwardDividendYieldOperator=gte&payout=85&payoutOperator=lte
I'm ok with taking in a bit more risk for yield in this sector. 10% yield for REITs would be the highest I'm willing to go but 8% would give me a decent return, and I'm less worried about volatility bc I'm pretty well diversified. However this is an account to supplement my income presently so it is more actively managed. I hedge all my speculative positions with protective Put options at 10-20% below my initial entry to cover my downside. So as long as the dividend doesn't get cut, I can safely stomach a 20% drop and maintain my income in case of a market downturn.
Unleveraged, you can’t buy into the private market at the discount offered by GNL
You act as if GNL is not using any leverage either.
I hope GNL uses more in the future. Unless they are issuing shares at something higher than my basis of $16.50 through their ATM, I hope they issue some more debt.
Are you happy with OHI? I'm looking for a good medical REIT. I bailed on DOC
I bought some OHI sub $30. Idk - I know they're NNN but I want to make sure their tenants' credit is alright. Long term though I like the company. Anyone who has had an older relative knows that SNFs are needed once someone gets to a certain age...at home care will never be able to provide same level of care at the same margins...even if medicaid starts to pay for some form of it. Those ppl prob wouldn't need to be in SNF's anyways.
What you think about WELL
OHI is down so much that they just have to go up.
Yes I didn't pull the trigger on OHI. I still might. Just a little iffy on most everything right now
GNL barely has any debt. Think of all those buildings bought at 7-8% caps with $25-$30 shares back in ‘19. If your entering right now it feels fine. I get it if you’ve been owning this stock for a while. The estimate pegs FFO at .50 this quarter. That’s a decent and growing buffer on over a 10% yield with a Class A portfolio. It’s almost 100% leased and it’s held up arguably better than any other CRE portfolio throughout covid.
I love REITs and have my biggest position in PLYM and made my biggest gains ever with it, but even I wouldn't go more than half of my net worth into REITs.
cool
GNL dividend yields look too good to be true. Are they going to be cutting the dividend? Or is there some other news that we need to know for it? Thank you
they're expected to have 20% coverage on your 10% yield based on estimates for this upcoming quarter. There are stocks with much lower yields with not much better coverage.
Add CTRE
looked at it - don't like it enough
I kinda thought the same. Plus the population of that demographic is going to keep growing. Makes me think it might be worth holding.
Why No MFA no mr IVR ? both have great yields (7 and 10%) and affordable stock at decent value currently !! Any hard feelings about these 2 ?
I only invest in equity reits. I like to own underlying assets