Highest REIT Yields By Real Estate Sector

Real estate investment trusts - REITs - have been pretty good to investors so far this year. The largest REIT ETF's are up about 13 percent for the first half of 2011. Rising share prices will result in declining yields, and the average yield for real estate trusts is in the low 3 percent range. REIT investors looking for yield can do significantly better than the averages. Here are the current top yielding REIT stocks in the different sectors of commercial real estate. Healthcare: Sabra Healthcare REIT Inc. (Nasdaq: SBRA), with a 38 cent quarterly dividend, sports a current yield of 7.8 percent.  Sabra was spun off by Sun Healthcare (SUNH) late last year and initiated dividend payments in May of this year. Three other healthcare REITs are yielding over 7 percent. Apartments: Most of the apartment REITs yield near the average for all REIT stocks. Associated Estates Realty Corp. (AEC) has the high yield at 4.2 percent with its 17 cent quarterly dividend. AEC has headquarters in Ohio with a $680 million market cap Hotel / Lodging: Yields in this sector of commercial real estate range from a significant portion of stocks with suspended dividends up to the 7.4 percent yield of Hospitality Properties Trust (NYSE: HPT) on a 45 cent quarterly dividend. Commercial: Monmouth Real Estate Investment Corp. (NYSE: MNR) has been paying a 15 cent quarterly dividend for years. The share price stays in a range to keep the yield near the current 7.0 percent. Office: Several office REITs had yields over 6 percent and Government Properties Income Trust (NYSE: GOV) tops the list at a 6.2 percent yield. The $1.1 billion market cap stock currently pays a 42 cent quarterly distribution. Mortgage: The mortgage REITs holding residential MBS have distribution yields well into the double digits with the best known stocks yielding 13 percent or more. The current top yield is American Capital Agency Corp. (Nasdaq: AGNC) at 19.5 percent. The market is betting the dividends will decease when the spread between MBS yields and borrowing costs narrow. Retail: The highest yield among the shopping center and strip mall REITs belongs to Agree Realty Corp. (NYSE: ADC), paying a 40 cent quarterly distribution for a 7.1 percent yield. The market cap of ADC is $215 million. You can see, REIT yields vary significantly by real estate sector and there is as much or more variance within the sectors regarding distribution yields. So far in 2011, REIT investors are having cake and eating it too with stock price increases and fat dividend yields.... Read more