The 13 Best REITs to Own in 2019

Real estate investment trusts (REITs) – a way for investors to gain access to assets such as apartments and office buildings while often collecting generous yields – had a disappointing 2018.

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Real estate investment trusts (REITs) – a way for investors to gain access to assets such as apartments and office buildings while often collecting generous yields – had a disappointing 2018. With just a few days left to go in the year, the Vanguard REIT ETF (VNQ (opens in new tab)) had lost 13.5% compared to a 12% decline for the broader market. This contrasts with 10-year average annual gains of just more than 12% for the VNQ.

Will REITs bounce back in 2019? Well, the same fear that hampered these real-estate plays in 2018 – rising interest rates – still is on the board for the coming year. And higher rates on bonds sometimes hamper the performance of REITs.

However, these companies are not created equal. The best REITs for 2019 could benefit from other powerful trends in 2019. For instance, cloud computing’s growth should continue to fuel robust demand for data storage services. A massive infrastructure spending bill could improve the fortunes of related REIT plays. And mobile-data growth, as well as the rollout of lightning-fast 5G technology, offers potential growth for cell-tower REITs.

Here are the 13 best REITs to buy and hold in 2019. Not only should they benefit from broad trends that could help them outperform their brethren, but REITs as a whole are trading at much more palatable valuations lately. Moreover, average dividend yields in the space currently exceed 4%; all the more reason for investors to stick with REITs if market rockiness continues in the coming year.

Data is as of Dec. 25, 2018. Dividend yields are calculated by annualizing the most recent quarterly payout and dividing by the share price.

Lisa Springer
Contributing Writer, Kiplinger.com

Lisa currently serves as an equity research analyst for Singular Research covering small-cap healthcare, medical device and broadcast media stocks.