2 Industrial REITs to Buy for Income in 2024
Industrial real estate investment trusts (REITs) own and manage income-generating industrial properties, such as warehouses, distribution centers, logistics facilities, and manufacturing plants. Industrial REITs generate income by leasing the properties.
Investors in industrial REITs can benefit from the demand for space in the logistics and manufacturing sectors. The growth of e-commerce and the need for efficient supply chain management have contributed to the growth of the space in recent years. Similar to other REITs, industrial REITs are required to distribute a significant portion of their income to shareholders in the form of dividends.
Prologis
Prologis Inc. (NYSE:PLD) is one of the world's largest owners, developers, and managers of industrial properties, including distribution facilities, logistics centers, and warehouses, with ownership interests in approximately 1.2 billion square feet across the globe. Its largest clients include industry giants like Amazon (NASDAQ:AMZN), FedEx (NYSE:FDX), Home Depot (NYSE:HD), and UPS (NYSE:UPS).
Prologis currently pays a quarterly dividend of $0.87 per share, equating to $3.48 per share annually, which gives it a yield of about 2.7% today. The company has also raised its annual dividend for 10 consecutive years, making it a great play for both dividend income and dividend growth.
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Stag Industrial
Stag Industrial (NYSE:STAG) owns and operates 568 industrial properties in 41 states containing 112 million square feet as of September 30, 2023. Like Prologis, Stag counts Amazon and FedEx as two of its largest clients, along with XPO (NYSE:XPO) and WestRock (NYSE:WR).
Stag pays a monthly dividend of $0.123333 per share, equating to about $1.48 per share annually, which gives it a yield of about 3.9% today. In addition to being a monthly income stock, Stag has raised its annual dividend every year since its 2011 initial public offering, making it qualify as a dividend-growth play as well.
Another way to invest in industrial properties
Commercial real estate, including industrial, has historically outperformed the stock market, but few investors have the capital or resources needed to invest in this asset class. A platform backed by industry giant Marcus & Millichap is changing that, allowing individuals to invest in commercial real estate with as little as $5,000. If public REITs don't interest you, then maybe this will.
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