Investors that have read my previous commentary on the overall real estate sector, and real estate investment trusts (REITs) in particular, will know that industrial real estate is among the niche sub-sectors I am most bullish on today from the perspective of a conservative long-term investor.
In this article, I am going to discuss why I believe Dream Industrial REIT (TSX:DIR.UN) is among the best picks in this space right now.
Dream Industrial is, as one would expect, heavily exposed to the macroeconomic drivers which will ultimately dictate what form we can expect to see a recovery take. I do believe there will be winners and losers coming out of this recession.
I view industrial real estate as being among the real estate sub-sectors that will perform the best in the years to come. This is because industrial real estate is far more leveraged to secular growth in increased shipping times (driven by e-commerce, mainly).
Dream Industrial’s high-quality portfolio of industrial real estate conveniently located near urban centers makes this a great way to play these long-term trends.
This solid business model supports a dividend yield of approximately 7% at the time of writing. This yield only currently requires a dividend payout ratio of approximately 55%, one of the lowest in the sector, speaking to the strength of earnings Dream Industrial has shown, as well as the strength of investor sentiment with respect to Dream Industrial’s ability to maintain and grow its dividend long-term.
Invest wisely, my friends.
