11 Best Canadian REIT Stocks (Sep 2022): Get Monthly Dividends

Buying an investment property to rent out is not the only way to invest in real estate. Many REIT stocks exist in Canada which allow you to get real estate exposure through your investment accounts.

In terms of returns, REIT total return performance over the past 20 years has outperformed the S&P 500 Index.

Since the S&P 500 is a difficult benchmark to outperform, this is excellent news for investors considering investing in REITs. This might not translate exactly to the Canadian market, but it’s a good indicator of the potential of REITs.

We will cover the best Canadian REIT stocks below and why they may be an excellent addition to your portfolio.

Pros and Cons of REITs

Like all other investments, REITs have their pros and cons when it comes to investing:

Pros
  • The ability to add real estate exposure to your investment accounts
  • Much higher liquidity than buying and selling a physical property
  • Great income potential
  • The ability to access sectors that you may not normally be able to invest in (office space)
  • Potential for more tax efficiency by deferring taxes (RRSP accounts) or being tax exempt (TFSA) altogether.
  • Buying and selling properties can be time-consuming. Trading REITs is extremely easy and takes very little time.
Cons
  • Daily stock performance changes can cause higher volatility than owning physical property.
  • Some REIT sectors may underperform based on market trends or conditions
  • Lack of control over performance and management of properties
  • Investing in REIT stocks also puts you at the mercy of the REIT manager. They may do a better or worse job of managing the properties in their portfolio.

The increased liquidity of REITs can be a double-edged sword. In a market crisis, REIT stocks can fall aggressively when investors are flocking to cash and liquidating positions. Directly owning physical properties will likely not have the same effect.

Canada’s Monthly Dividend Paying REITs

Here is a full list of all the REITs in Canada:

CompanyTickerMarket CapDividend Yield
(12-Month Trailing)
Automotive PropertiesAPR-UN.TO$662.90 Million5.86%
Allied PropertiesAP-UN.TO$3.64 Billion5.93%
ArtisAX-UN.TO$1.15 Billion5.88%
BoardwalkBEI-UN.TO$2.28 Billion2.2%
BTB BTB-UN.TO$288.42 Million8.67%
Canadian Apartment Properties CAR-UN.TO$7.34 Billion3.38%
Choice PropertiesCHP-UN.TO$9.59 Billion5.49%
CrombieCRR-UN.TO$2.67 Billion5.75%
CTCRT-UN.TO$3.67 Billion5.37%
Chartwell Retirement Residences CSH-UN.TO$2.27 Billion6.2%
Dream IndustrialDIR-UN.TO$2.86 Billion6.12%
Dream Office D-UN.TO$788.31 Million5.86%
First CapitalFCR-UN.TO$3.18 Billion2.87%
GraniteGRT-UN.TO$4.62 Billion4.23%
H&RHR-UN.TO$3.26 Billion5.18%
InterRentIIP-UN.TO$1.63 Billion2.85%
Killam Apartment REIT KMP-UN.TO$1.81 Billion4.36%
Minto ApartmentMI-UN.TO$546.15 Million3.31%
Morguard North American ResidentialMRG-UN.TO$873.99 Million4.48%
MorguardMRT-UN.TO$324.13 Million4.79%
NorthWest Healthcare PropertiesNWH-UN.TO$2.77 Billion6.81%
Plaza Retail REIT PLZ-UN.TO$416.12 Million7.09%
RioCan Real Estate Investment Trust REI-UN.TO$5.91 Billion5.05%
Slate Grocery REIT SGR-UN.TO$829.71 Million6.1%
Slate Office REIT SOT-UN.TO$376.88 Million9.01%
SmartCentresSRU-UN.TO$4.53 Billion6.83%
True North TNT-UN.TO$1.05 Billion9.98%

Best Canadian REIT Stocks

Diversified REITs

1.     H&R Real Estate Investment Trust

H&R REIT Logo
  • Ticker: HR-UN.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 4.33%
  • Payout Ratio: 11.80%
  • Dividend Yield (12-Month Trailing): 5.18%
  • Upcoming Dividend Date: Sep 15, 2022
  • Market Cap: $3.26 Billion
  • Average Analyst Rating: 2.3 - Buy

H&R REIT is one of the largest publicly-traded REITs in Canada. H&R is classified as a diversified REIT, investing in retail, office, industrial, and residential properties. The REIT invests across both the US and Canada.

H&R’s portfolio has the highest allocation towards residential properties (approximately 35% of the total portfolio). Currently, the portfolio has just over 20 residential properties, mainly in the US.

H&R also has a sizable office allocation, which is approximately 33% of the total portfolio. This consists of over 20 properties in Canada and 4 properties in the US.

The retail segment is next in the portfolio, with just under a 20% allocation. This segment contains 40 properties in Canada and 15 properties in the US.

Last is the industrial segment, with 69 properties in Canada and three properties in the US.

In total, H&R REIT owns 416 properties with just under 30,000 square feet of real estate. The fair market value of these properties is approximately $10 billion CAD.

As a diversified REIT, H&R is a great choice to consider because it invests across multiple real estate categories. This allows you to somewhat diversify risk over time as market conditions change.

2.     Canadian Net Real Estate Investment Trust

Canadian Net Logo
  • Ticker: NET-UN.V
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 4.99%
  • Payout Ratio: 29.45%
  • Dividend Yield (12-Month Trailing): 4.77%
  • Upcoming Dividend Date: Dec 30, 2022
  • Market Cap: $140.03 Million
  • Average Analyst Rating: 1.6 - Buy

Canadian Net REIT is another diversified REIT in Canada, although many times smaller in market capitalization than H&R. It invests exclusively within Canada, with 59% of its properties in Quebec, 29% in Ontario, and 13% in Nova Scotia.

NET.UN focuses on high-quality commercial real estate. It aims for long-term, management-free, net basis leases. It targets fairly small properties – those that are too large for individual investors but too small for larger REITs to consider.

The REIT has a 59% allocation toward retail properties, 24% toward national service-station and c-store chains, and 15% toward quick-service restaurants. It also has a 2% allocation towards other properties that do not fall within the first three.

Net REIT has a shorter performance track record than H&R REIT. It also focuses on relatively smaller properties, pays a higher forward dividend, and comes with a lower payout ratio.

Similar to H&R REIT, Net REIT is a great REIT stock to consider because it invests across multiple real estate segments. This allows you to diversify away from any particular weakness in a specific sector.

Retail REITs

3.     Plaza Retail Real Estate Investment Trust

Plaza REIT Logo
  • Ticker: PLZ-UN.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 6.75%
  • Payout Ratio: 28.19%
  • Dividend Yield (12-Month Trailing): 7.09%
  • Upcoming Dividend Date: Oct 17, 2022
  • Market Cap: $416.12 Million
  • Forward P/E Ratio: 19.24
  • Average Analyst Rating: 2.7 - Hold

Plaza Retail REIT is a REIT stock within the retail category. It invests exclusively in properties within Canada, with a 61.7% allocation to Atlantic Canada, 16.9% allocation to Ontario, 20.1% allocation to Quebec, and only 1.3% allocated to Western Canada.

Plaza Retail REIT obtains its net operating income (NOI) from strip malls (68.1%), single retailers (22.5%), single quick service restaurants (5.2%), and enclosed retailers (4.2%).

Plaza has a large internal team of professionals that are able to help with extensive property developments or redevelopments. Insiders also own a significant ownership position in Plaza Retail REIT.

PLZ.UN has a medium-length performance track record and pays an excellent dividend yield to investors.

In terms of size, it is a fairly large REIT by market capitalization. It focuses on smaller properties and frequently gets involved in developing or redeveloping them. Its properties are frequently occupied by national tenants.

Plaza Retail REIT is a great choice to consider as a retail Canadian REIT stock with a very high-income stream.

4.     Slate Grocery Real Estate Investment Trust

Slate Grocery REIT Stock
  • Ticker: SGR-UN.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 7.73%
  • Payout Ratio: 50.54%
  • Dividend Yield (12-Month Trailing): 6.1%
  • Upcoming Dividend Date: Sep 15, 2022
  • Market Cap: $829.71 Million
  • Average Analyst Rating: 2.7 - Hold

Slate offers Canadian investors a US, grocery-retail-focused REIT. The REIT is 95% grocery-anchored and has 107 properties across 23 states in the US. The REIT’s properties cover 13.2 million square feet.

Slate Grocery REIT’s top grocery tenants include Walmart, Kroger, Costco, and Target. In an inflationary environment, grocery stores tend to lead as a percentage of total consumer spending. The REIT was very active during the COVID-19 pandemic, getting involved in numerous acquisitions.

Slate has a medium-length performance track record and pays a high dividend yield to investors. With a payout ratio of over 100%, Slate’s high dividend yield is likely unsustainable in the future and will likely decrease.

In terms of market capitalization, Slate is a very large REIT stock available to Canadians. The REIT is also currently involved in several ESG initiatives, which may be attractive for investors focused on responsible investing solutions.

If you are looking to add real estate exposure that is strictly US-focused, Slate Grocery REIT stock is a great option to consider.

5.     First Capital Real Estate Investment Trust

First Capital Logo
  • Ticker: FCR-UN.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 2.86%
  • Payout Ratio: 45.00%
  • Dividend Yield (12-Month Trailing): 2.87%
  • Upcoming Dividend Date: Oct 17, 2022
  • Market Cap: $3.18 Billion
  • Average Analyst Rating: 2.0 - Buy

First Capital REIT is another retail-focused Canadian REIT stock. The REIT had properties in 148 neighbourhoods across Canada and has over 22.5 million square feet of leasable space.

Notable properties include Shops at King Liberty, Leaside Village, One Bloor East, and Yorkville Village. A substantial portion of their properties is located in higher-end neighbourhoods or areas of Canada.

First Capital REIT’s market capitalization is massive, making it one of the largest REITs in Canada. The REIT currently has 157 properties in Eastern Canada and 59 properties in Western Canada.

FCR.UN has a low dividend yield and a relatively lower payout ratio than most other REITs on our list. This may make it less attractive for investors that are looking for a high dividend yield or high monthly cash flows.

One of First Capital’s main focuses is community involvement. First Capital has a huge emphasis on ESG, diversity & inclusion, and supports artists across the communities in which they are present.

If you are looking for a REIT stock with a long performance track record, large market capitalization, and heavy involvement in its community, First Capital REIT may be a good option.

Residential REITs

6.     Minto Apartment Real Estate Investment Trust

Minto Apartment Logo
  • Ticker: MI-UN.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 3.16%
  • Payout Ratio: 5.77%
  • Dividend Yield (12-Month Trailing): 3.31%
  • Upcoming Dividend Date: Oct 14, 2022
  • Market Cap: $546.15 Million
  • Average Analyst Rating: 1.9 - Buy

Minto Apartment Real Estate Investment Trust is a large residential REIT in Canada. The REIT owns 32 high-quality, multi-residential properties in major cities like Toronto, Montreal, Ottawa, Calgary, and Edmonton.

MI.UN is Canada’s only entirely urban residential REIT. Minto’s residential properties have over 7,500 suites in total across Canada. The majority of Minto’s rental properties are located in the city of Ottawa.

The executive management team has a lot of experience and an average of eight years with the Minto team. The REIT’s market capitalization is fairly large.

Minto owns a 40% interest in its own REIT, along with investors. Minto has one of the highest-in-place rents among its publicly-traded competitors.

Minto Apartment REIT has a fairly short performance track record and pays a relatively lower dividend than most REIT stocks on our list. Its low payout ratio likely shows that Minto is reinvesting its earnings into expanding its operations and that the current dividend is sustainable going forward.

If you are looking for exposure to residential real estate without purchasing condominium or apartment units, Minto Apartment REIT is a great choice to consider.

7.     Flagship Communities Real Estate Investment Trust

Flagship Communities Logo
  • Ticker: MHC-U.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 3.28%
  • Payout Ratio: 9.95%
  • Dividend Yield (12-Month Trailing): 3.29%
  • Upcoming Dividend Date: Oct 17, 2022
  • Market Cap: $313.79 Million
  • Average Analyst Rating: 1.9 - Buy

Flagship Communities REIT is a US-focused residential REIT listed on the Toronto Stock Exchange. MHC.UN is one of the biggest developers of manufactured housing communities (MHC) in the US Midwest. The REIT is involved with communities across Kentucky, Indiana, Ohio, Arkansas, Illinois, and Missouri.

Flagship Communities REIT owns and operates 67 communities with a total of 11,876 lots. Manufactured housing refers to factory-built homes such as trailers that can be placed on a vacant lot of land.

MHC.UN is positioned to be a consolidator within the fragmented manufactured housing community industry. This is because the MHC in the US is mainly owned by local owner-operators.

The REIT stock has an extremely short performance track record and has a relatively small market capitalization compared to other REITs on our list. It pays a relatively lower dividend but has a low payout ratio, outlining that Flagship Communities is investing heavily into growing its operations.

If you are looking for a unique REIT that is focused on US real estate throughout the Midwest, Flagship Communities REIT is an excellent option to choose here in Canada.

Industrial REITs

8.     Nexus Industrial Real Estate Investment Trust

Nexus Industrial Logo
  • Ticker: NXR-UN.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 6.30%
  • Payout Ratio: 42.30%
  • Dividend Yield (12-Month Trailing): 7.03%
  • Upcoming Dividend Date: Sep 15, 2022
  • Market Cap: $716.07 Million
  • Average Analyst Rating: 1.9 - Buy

Nexus Industrial REIT is an industrial REIT in Canada that owns a portfolio of quality industrial, office, and retail Canadian properties. It aims to continue growing its presence within Canada, potentially expanding into the US.

NXR.UN owns a total of 106 properties across its portfolio, with 24 acquired in 2021 and 9 acquired in the first half of 2022.

The REIT’s industrial portfolio currently generates 84% of its net operating income (NOI). The retail portfolio generates 11% of NOI and the office portfolio generates just 5% of NOI.

Nexus Industrial invests across 9 provinces and territories with a large number of properties in Quebec, Ontario, and Alberta. The REIT trades at conservative multiples for an industrial REIT and has a conservative capital structure. This allows it to access debt easily if needed in the future.

The REIT has a medium-length performance track record and is fairly large in terms of market capitalization. It pays a high dividend yield but also has a relatively high payout ratio.

If you are looking for a Canadian-focused industrial REIT, Nexus Industrial REIT is an excellent choice.

9.     Summit Industrial Income Real Estate Income Trust

Summit Industrial Logo
  • Ticker: SMU-UN.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 3.13%
  • Payout Ratio: 14.40%
  • Dividend Yield (12-Month Trailing): 3.2%
  • Upcoming Dividend Date: Sep 15, 2022
  • Market Cap: $3.24 Billion
  • Average Analyst Rating: 2.2 - Buy

Summit Industrial Income REIT is the largest industrial-focused REIT in Canada. It owns properties only in Canada, with 55.3% in Ontario, 23% in Alberta, 21.5% in Quebec, and 9.5% across the rest of Canada.

The number of properties in the portfolio has grown from just 30 in 2013 to 156 by the end of 2021.

Summit has a strong focus on ESG metrics. The REIT uses a green financing framework, has closed a successful green bond offering, and uses a green unsecured development credit line for eco-friendly buildings.

Summit Industrial Income REIT believes there is still a lot of opportunity for growth within the industrial real estate space in Canada, as the industry remains highly fragmented with a high degree of non-institutional ownership.

SMU.UN has a very long performance track record and a massive market capitalization. It pays a relatively low dividend yield but has an extremely low payout ratio. This indicates that a lot of earnings are being invested back into the business. 

Summit Industrial Income REIT is an excellent choice to consider within the industrial space.

Office REITs

10.  True North Commercial Real Estate Investment Trust

True North Commercial Logo
  • Ticker: TNT-UN.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 9.50%
  • Payout Ratio: 81.46%
  • Dividend Yield (12-Month Trailing): 9.98%
  • Upcoming Dividend Date: Oct 17, 2022
  • Market Cap: $1.05 Billion
  • Average Analyst Rating: 3.0 - Hold

True North Commercial REIT focuses exclusively on office space across Canada. It owns a portfolio of high-quality assets across five provinces with a high percentage of government and credit-rated tenants.

The REIT owns 46 properties and has a total of 4.8 million square feet within its portfolio. True North Commercial is focused on an aggressive acquisitions program and looks for office properties with credit-worthy tenants that have long-term lease maturities.

TNT.UN uses best-in-class, third-party property managers to manage their assets efficiently. One major asset manager is Starlight Investments. 96% of their properties are occupied, and 76% of their tenants are either the government or credit-rated tenants

The REIT has a long performance track record and a large market capitalization. It pays an extremely high dividend yield but also has a very high payout ratio. This makes it unlikely for the high dividend yield to be sustainable in the future.

If you are looking for a Canadian office REIT with a very high dividend yield, TNT.UN is a great option to consider for your portfolio.

11.  Slate Office Real Estate Investment Trust

Slate Office Logo
  • Ticker: SOT-UN.TO
  • Listed on: Toronto Stock Exchange
  • Forward Dividend Yield: 8.96%
  • Payout Ratio: 42.99%
  • Dividend Yield (12-Month Trailing): 9.01%
  • Upcoming Dividend Date: Oct 17, 2022
  • Market Cap: $376.88 Million
  • Average Analyst Rating: 2.9 - Hold

Slate Office REIT is a global office REIT that trades on the Toronto Stock Exchange. It operates assets across North America and Europe and focuses on government and high-quality credit tenants.

Slate focuses on acquiring real estate at a discount to replacement cost and creates value through their expertise.

The REIT owns 55 properties, the majority of which are in North America. It owns 7.7 million square feet of space with 67% of tenants being either the government or high-quality credit tenants.

SOT.UN has a medium-length performance track record and is decently sized in terms of market capitalization. It pays a very high dividend of just under 9% but also comes with a relatively high payout ratio of over 50%. The high payout ratio can make it difficult to maintain such a high dividend over time.

Relative to True North, Slate has a similar dividend yield with a much lower payout ratio.

If you are looking to invest in office space within a global context, Slate Office REIT stock is an excellent choice to consider here in Canada.

How REITs Work

REITs (or real estate investment trusts) are fairly straightforward to understand. They are companies that pool money from investors and buy real estate properties to manage. Rental income and capital gains are then paid back to investors.

REITs typically focus on different real estate areas. Some common categories include:

  • Retail REITs
  • Residential REITs
  • Healthcare REITs
  • Office REITs
  • Mortgage REITs
  • Hotel and Motel REITs

Some REITs may perform relatively better or worse, depending on market trends or conditions. Throughout the COVID-19 sell-off of 2020, office and retail REITs underperformed as people were stuck at home.

REITs can be publicly traded (such as REIT stocks) or privately traded. A REIT has some flexibility in choosing between whether to reinvest its earnings back into the business (to grow) or to pay it out to investors in the form of a dividend.

The sustainability of a REIT’s dividend can be judged based on how high its payout ratio is. This will be discussed in further detail below.

What to Look For in a Good REIT

There are several elements to look for in a good REIT before deciding to put your money to work.

  1. A long performance track record with a decently-sized market capitalization: The performance track record can showcase how well the REIT management team has done in generating returns for investors. A larger market capitalization shows a higher level of investor interest.
  2. High dividend yield: This is especially true for investors that are looking for an income stream from their real estate investment. While constant cash flows are very useful, keep in mind that dividends are cash that the company is not using to grow its business further.
  3. Low payout ratio: A lower ratio likely indicates a more stable and sustainable dividend in the future. REITs with a high payout ratio (especially over 100%) will likely have to reduce their dividend in the future. A combination of a low payout ratio and a high dividend is ideal.
  4. Performance during periods of market stress: Depending on the REIT’s sector, it may be more or less prone to sell-offs. This can be invaluable to investors, especially those that are more risk averse.

How to Buy the Best Canadian REIT Stocks

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Conclusion

REIT stocks are an important element to be considered when building a well-constructed portfolio. Including real estate in your investment portfolio increases diversification and will likely increase your portfolio’s yield.

There are many excellent REIT stocks available in Canada across different REIT sectors.

If you are looking to add real estate exposure to your portfolio but don’t want to invest through a REIT, real estate stocks also exist as an option. Within Canada, there are several that may be excellent complements or substitutes to REITs.

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Author Bio - Christopher Liew is a CFA Charterholder with 11 years of finance experience and the creator of Wealthawesome.com. Read about how he quit his 6-figure salary career to travel the world here.

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11 thoughts on “11 Best Canadian REIT Stocks (Sep 2022): Get Monthly Dividends”

  1. Hi ! Im so new to all of this ! Can I have your opinion about which one will you choose as a beginner ? And will you choose more than one ?

    Thanks so much !

    Reply
  2. Hi Chris, if I purchase a REIT now at 4% dividend yield and the rate increases a few years later, will I earn the new, higher, rate or will I be locked in at the rate I bought it at?

    Reply
  3. Hi Chris, I was wondering why people wouldn’t always invest in the REITs with the highest dividend yield percentages. For example, the 11% dividend yield is far better than the 4% yield, so why would people choose to invest their money there instead of the higher rate.

    Reply
    • Great question Tyler, so the dividend yield is just one piece of the puzzle. You have to look at the payout ratio (how much of their earnings is a company paying out to it’s shareholders?) if it’s too high it’s not a good sign that it will be sustainable. Also, you have to look at past and future growth of the stock. A company might have a high dividend, but the stock might have decreased in value, or hardly grown, or have poor growth prospects for the future.

      Reply
  4. Hi Chris…

    It was a good read … I was trying to search the mentioned stcks with their ticker name in wealthsimple trade and couldn’t find them like the first one Northview apartment and the fourth one too slate office …..Am I missing something

    Reply

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