Most REITs increased dividends during 2014, indicating confidence in FFO growth. Improved profitability makes additional dividend increases likely.
Health Care REITs offer attractive yields of 5.5% on average. Industrial REITs now yield 4.7% (up due to stock price underperformance), while Office REITs yield 4.0% on average. Yields for Residential REITs are now 3.8%. Both Retail REITs and Specialty REITs now yield 4.4% on average. Despite dividend increases, Hotel REITs are still the lowest yielding sector at 3.0%. Financial REITs offer income investors the highest yield, at 9.0% on average.
Variability in yield for each sector is greater than shown here. Average yield for all REITs as of September, 2014 is 4.6%.
REIT Growth and Income Monitor covers 132 REITs with total market cap of $736 billion, as of the end of September, 2014.
During August, 2014, Specialty REITs expanded market cap from new coverage. Iron Mountain added to Storage REITs, while pending REIT conversion of Equinix added to Data Center REITs. New coverage of Specialty Cell Tower REIT Crown Castle added $25 billion to total market cap of Specialty REITs.
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