REITs: A (Slightly Anxious) Investor’s Guide

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Right. So, the market. Honestly, it’s exhausting. One minute it’s all doom and gloom, the next everyone’s talking about ‘irrational exuberance’ again. I decided, for my own sanity (and the sake of not checking my portfolio approximately every 30 seconds), to look at something…solid. Something that isn’t a cryptocurrency promising the moon. Which led me to REITs. Real Estate Investment Trusts. Sounds…responsible, doesn’t it? Like grown-up investing. I’m tentatively hopeful.

The basic idea is they own properties – shopping centers, data centers, casinos, the works – and rent them out. They’re legally obliged to hand most of their profits back to us investors as dividends. It’s almost…generous. Almost. Of course, there’s always a catch. Interest rates, naturally. 2022 and 2023 were…challenging. Higher rates meant it cost more to buy new properties, and tenants were feeling the pinch. The dividends suddenly didn’t seem so attractive when you could get a decent return from just…putting your money in a bank. The sheer mundanity of it all!

But here’s the thing. The Federal Reserve started cutting rates. Six times! It’s like a tiny glimmer of hope in a world of spreadsheets and financial jargon. Which means REITs might actually be…desirable again. Before everyone else realizes this and the prices shoot up. So, I’ve done some digging. And, after much deliberation (and several cups of tea), I’ve identified three that seem…promising. Don’t judge me if it all goes wrong. I’m just a woman trying to navigate the complexities of late-stage capitalism.

Realty Income

First up: Realty Income. They’re enormous. Like, really enormous. Over 15,500 properties across the US and Europe. They lease to the businesses that, frankly, survive everything. Drugstores, discount stores, convenience stores. The places people still go even when the economy is collapsing. 7-Eleven, Dollar General, Walgreens… they’re the stalwarts. The reliable ones. It’s…comforting. They’ve been around since 1994, and their occupancy rate has stayed stubbornly above 96% since then. Currently, it’s at 98.7%. Which, let’s be honest, is slightly terrifying. How do they do that?

It’s a ‘triple-net lease’ arrangement, which means the tenants pay for maintenance, insurance, and property taxes. Which is brilliant, really. It’s like they’re doing all the work, and Realty Income just…collects the rent. They pay a forward yield of 5.3%, and they’ve increased their payout 132 times since they went public. 132! I’ve barely managed to increase my savings account balance by that much. They expect their adjusted funds from operations (AFFO) to grow by 1-2% in 2025, which should easily cover their dividend. At $61, it seems…reasonable. A safe place to park your cash, as they say. A little bit boring, perhaps, but boring is good right now.

Vici Properties

Next up: Vici Properties. This one’s a bit different. They own casinos and entertainment properties. Casinos! It feels…risky. But apparently, they’ve managed to maintain a 100% occupancy rate since 2018. 100%! How is that even possible? They lock their tenants into long-term leases, and most of those leases are tied to the Consumer Price Index. Which means they can raise rents to keep up with inflation. It’s…ingenious, really. And also slightly unsettling. They’re also a triple-net lease REIT, so the tenants are responsible for everything. It’s like they’re running the show, and Vici just…collects the winnings.

They’ve been raising their dividends every year since they went public, and they currently pay a forward yield of 6.1%. At $29, it seems…like a bargain. A slightly decadent bargain, perhaps, given the whole casino thing, but a bargain nonetheless. They expect their AFFO to rise by 4-5% in 2025, which should easily cover their dividend. It’s…tempting. Very tempting.

Digital Realty

Finally: Digital Realty. This one’s all about data centers. Data centers! Apparently, everything is moving to the cloud, and someone needs to store all that data. Digital Realty operates over 300 data centers for over 5,000 customers, including half of the Fortune 500. IBM, Oracle, Meta… they’re all clients. It feels…important. Like being part of the future. Or at least, profiting from it.

Their AFFO dipped a bit over the past four years, and they stopped raising their dividends. But that was mainly because they were selling off older, less profitable data centers. They’re focusing on the high-growth hyperscale data centers. Makes sense, I suppose. They expect their core FFO to rise by 8-9% in 2025, which should cover their dividend. They currently pay a forward yield of about 3%. It’s…steady. Reliable. A bit unexciting, perhaps, but sometimes that’s exactly what you need. It’s a balanced way to profit from the whole cloud infrastructure thing, without getting swept up in the AI hype. And let’s be honest, the AI hype is terrifying.

So, there you have it. My (slightly anxious) guide to REITs. Don’t blame me if it all goes wrong. I’m just a woman trying to make sense of the market, one dividend at a time. Units of Cryptocurrency Lost: 0. Hours Spent Watching Charts: 18. Number of Panicked Texts to Friends: 12. I need a lie down.

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2026-01-19 21:53