Monmouth REIT: Cast Your Net To Catch A Trophy 'Dividend' Fish

Industrial property is among the most stable, low-volatility asset classes in the United States as evidenced by the sector's historical occupancy rates of roughly 88%-92% (source: Reis Inc.). The tradeoff for the differentiated stability is that industrial property does not enjoy the higher yields of the riskier sectors. A fundamental reason for the industrial sector's stability is its responsiveness to demand and the associated lack of overbuilding. Because of the sector's short development cycle (six to nine months), industrial markets tend not to get over-built. Instead, the supply of buildings tends to stay in-line with demand. Here is a snapshot of the historical industrial construction trends (from 1996-current): As a result of limited construction (since the recession) and improved economic conditions, industrial occupancy rates (now around 90.5%) have begun to increase. Here is a snapshot of the industrial sector's occupancy rates from 1983-2012: Industrial REITs The FTSE NAREIT All Equity... Read more