SmartCentres Real Estate Investment Trust (SRU), H%26R Real Estate Investment Trust, RioCan Real Estate Investment Trust (REI. UN), Artis Real Estate Investment Trust (ARY), and Granite Real Estate Investment Fund (GRT) are some of the top Canadian REITs that investors can add to their portfolios. Real Estate Investment Trusts (REITs) are a great way to invest in real estate without having to own the property itself. REITs are companies that own and operate real estate and generate income through the payment of rents for its occupants.
To qualify as a REIT, the trust must pay at least 90% of its taxable income as a dividend or distribution to shareholders. In exchange for this generous payment, REITs are not required to pay any corporate taxes and also to own the property on which they collect rent.H%26R is one of Canada's largest REITs in terms of market capitalization and assets under management. Until the beginning of this year, the H%26R was a well-diversified REIT with residential and commercial stakes, headquartered in Toronto. If you look at the stock chart, you may notice a significant and sudden drop in the price of the REIT.
The REIT now focuses primarily on residential real estate and has maintained its 4.0% dividend yield that is distributed monthly. Of these properties, 67% are in Canada's Atlantic, 23% in Ontario and 10% are divided between British Columbia and Alberta.Killam REIT has earned an average of around 15% annually over the past five years, which doesn't even include the reinvested dividends it pays monthly. Dream Industrial REIT operates warehouses and fulfillment centers, as well as other industrial buildings. The REIT also has a stellar dividend yield of 4.25% and pays its distributions monthly.Riocan is one of the best-known Canadian REITs, but it is also one of the largest in terms of market capitalization and asset value.
The company owns 214 different properties in its portfolio and has an impressive committed occupancy rate of 96.4%, with 91.4% of these properties in Canada's six largest markets. Riocan pays a monthly dividend with a yield of 3.98%. Slate focuses on high-quality tenants, such as government agencies.Canadian Apartment Properties is no different, with a monthly payment and an annual return of 2.67%. Boardwalk REIT has a long history of performing well for Canadian investors, apart from a sharp decline a few years ago after its Alberta portfolio was hit hard.
Since then, Boardwalk REIT has more than recovered and has more than 33,000 properties in its portfolio.Boardwalk has been consistently performing throughout the pandemic and is currently trading at its 52-week high prices. The waterfront administration is also putting its money where its mouth is, with 26% of the shares owned by insiders, which is quite a high percentage. Boardwalk's distribution is not as high as other REITs, with a monthly payout with a return of only 1.77%.Morguard was one of the Canadian REITs hardest hit during the pandemic, as it has heavy exposure to retail properties such as malls and malls. There should be optimism that Morguard may rise once restrictions are lifted and that it should be able to restore the previous higher dividend yield in the future.Summit Industrial, a relatively unknown Canadian REIT, has 159 different warehouses and industrial centers across Canada.
It also provides some exposure to data centers, one of the only Canadian REITs that provides this. Summit pays decent but not spectacular return of 2.46% and pays distributions monthly.Smartcentres also has one of the best distributions, with a monthly payment with a return of 5.62%. High-dividend REIT stocks are excellent stabilizers in your portfolio and can add a sense of stability during times of volatility.Unfortunately for Questrade users, REITs do not fall under the category of ETFs, which means that trading fees are charged for transactions. Qtrade is a popular Canadian trading platform that offers all of these above mentioned REIT assets for you to add to your portfolio.Canadian investors will love Canadian REIT stocks because of their stable prices, steady growth, and generous monthly or quarterly distributions.
By investing in both residential and commercial REIT stocks, investors can ensure that their portfolios are further diversified and safe from declines in any specific sector or industry.Stocks have the potential for growth while REITs won't show as much growth in the short term but they can provide excellent cash flow to build your portfolio. Qtrade or Wealthsimple offer free trading on some trading platforms for REIT ETFs so it might be worth checking out if you use one of these platforms.