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28 Canadian REIT Stocks & ETFs with Expert Predictions (2019)

Melisa R. H.Melisa R. H. Posted On May 14, 2019
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REITs Overview
REIT stocks stand for real estate investment trusts. When an investor buys a REIT, they are buying a share in a commercial real estate portfolio. These portfolios own income-producing commercial real estate and pay good dividends. Most of them also operate their properties.

Usually, REIT stocks will focus on a particular segment of the real estate sector. However, ETFs and other specialty REITs will be a mix of diversified properties. REITs are great for diversifying your portfolio.

REITs are great high income securities alongside banks. Income investors favour this security as they give access to real estate combined with more liquidity than traditional real estate investments.

How can you buy REITs?
REITs can be purchased in any investment portfolio through a portfolio manager or on your own using an online brokerage. We recommend Questrade if you want to go through an online broker. You can read more about why we think it’s the perfect platform for any Canadian investor.

Certain REITs will focus on a specific part of the real estate market, while others will offer a diversified batch, such as with an ETF.

REITs and Risk?
REITs are considered volatile depending on where we are in the economic cycle. Oftentimes, a downturn in the economy and housing can cause volatility in REIT stocks. Canadian REIT stocks are facing pressure as the housing market in Canada enters less certain times. Real-estate market fluctuations will affect REITs directly. In a recession, these stocks can underperform. In recent years, investors dealing with a low interest rate climate have favoured REITs for income.

Other things to keep in mind are that there are usually higher management fees than with other investment securities. It’s also important to know that there are tax regulations and there are legal structures that makes it harder for growth in capital appreciation. However, they do offer stable cash flow and diversification for your portfolio if you don’t already own real estate.

Here is our selection of Canadian REIT Stocks & ETFs…

You might also like : Gimme Shelter (and a Dividend) : REITs.

💹 ETF

iShares S&P/TSX Capped REIT (XRE-T)
A Canadian REIT that is dominated by RioCan (REI.UN-T) and H&R Real Estate (HR.UN-T). RioCan operates many Canadian shopping centres.

iShares S&P/TSX Capped REIT (XRE-T) — Stockchase
iShares S&P/TSX Capped REIT (XRE-T) — Stockchase

Holds some office, some apartments. Some of those areas will be challenged. Try well-positioned retail REITs, ones where vacancies are low, or logistic warehouse-type REITs.

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Horizons Equal Weight Canada Reit Index Etf (HCRE-T)
This Canada focused REIT tries to follow the performance of the Solactive Equal Weight Canada REIT Index. Rates are pausing and traditionally, REIT stocks have done well during this period.

Horizons Equal Weight Canada Reit Index Etf (HCRE-T) — Stockchase
Horizons Equal Weight Canada Reit Index Etf (HCRE-T) — Stockchase

(A Top Pick Feb 07/20, Down 22%) REITs outperformed into early March at which point he exited. There will be a time when REITs will come back.

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BMO Equal Weight REITs Index (ZRE-T)
They broke out in March and has continued to do well. They have a dividend yield of 4.32%.

BMO Equal Weight REITs Index (ZRE-T) — Stockchase
BMO Equal Weight REITs Index (ZRE-T) — Stockchase

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. In the current state of REITs, ZRE is an equal weight ETF that reduces single company risk. A good choice for the sector today. Unlock Premium - Try 5i Free

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Harvest Global REIT Leaders Income ETF (HGR-T)
This ETF centres on gold and gold producers. This ETF will benefit from higher gold prices and offer stability. A great choice to hold gold in a different way.

Harvest Global REIT Leaders Income ETF (HGR-T) — Stockchase
Harvest Global REIT Leaders Income ETF (HGR-T) — Stockchase

Centres on the outlook for gold and gold producers. It's been an abandoned sector, but the fundamentals are pointing higher. US dollar has rolled over, starting to see inflation in the US, and it's held in well while markets have gone higher. There's been a move in the commodity in the last 6-8 weeks. Producers…

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Vanguard FTSE Cdn Capped REIT (VRE-T)
This index fund follows the performance of a broad range of Canadian real estate equity companies. It currently tracks the FTSE Canada All Cap Real Estate Capped 25% Index.

Vanguard FTSE Cdn Capped REIT (VRE-T) — Stockchase
Vanguard FTSE Cdn Capped REIT (VRE-T) — Stockchase

He likes real-estate as an asset class. He is more in private equity where volatility is lower and yield is better. He expects pretty significant destruction in retail and office REITs may have challenges with work from home. Broad REITs are probably not the best way to play this space. He prefers niche REITs.

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🏛 Financials

Canada
Smart REIT (SRU.UN-T)
A retail REIT that operates 60% in Ontario and the rest elsewhere. They have performed very well and pays a good dividend. Their biggest tenant is Walmart. They are also developping aggressively in Toronto.

Smart REIT (SRU.UN-T) — Stockchase
Smart REIT (SRU.UN-T) — Stockchase

Focus on Walmart and adjacent retail. Likes Walmart, but the adjacent retail faces headwinds. Management team says better growth in residential than in retail. She'd take this cue and invest in companies that already have residential exposure. Talk of distribution cut.

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Choice Properties REIT (CHP.UN-T)
A spin off company by Loblaws and the properties are leased to Loblaw stores. They have built-in future growth in the redevelopment of urban properties.

Choice Properties REIT (CHP.UN-T) — Stockchase
Choice Properties REIT (CHP.UN-T) — Stockchase

80% of its assets are retail. He shies away from retail, but Loblaw owns half of those assets, which is stable and boasts high rent collection. The company is in good hands and the dividend is safe. Managers are doing a good job to diversify into apartments and industrial spaces to diversify away from retail.

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WPT Industrial REIT (WIR.U-T)
A REIT that focuses on building facilities, mostly warehouses, that are used in traditional and online retail as well as manufacturing. They have a US focus and pay their dividends in USD. A name that can grow with e-commerce.

WPT Industrial REIT (WIR.UN-T) — Stockchase
WPT Industrial REIT (WIR.UN-T) — Stockchase

He loves industrial REITs because of e-commerce. Their holdings are all in the US. Interest rates are low, so refinancing is cheap. Best in class. (Analysts’ price target is $19.53)

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Northwest Healthcare Property REIT (NWH.UN-T)
A trust that runs medical office buildings in Canada, Germany, Brazil and other locations. They are diversified across the world and recently announced a project in Australia. They pay 6.9% yield.

Northwest Healthcare Property REIT (NWH.UN-T) — Stockchase
Northwest Healthcare Property REIT (NWH.UN-T) — Stockchase

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. A very decent REIT. They have a stable base of business with good income. Not cheap on valuation but the last quarter results were good and it has weathered the pandemic well. Unlock Premium - Try 5i Free

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Dream Office REIT (D.UN-T)
One of the largest Real Estate Investment Trusts in Canada. They specialize in office buildings. A lot of their operations are focused in Toronto.

Dream Office REIT (D.UN-T) — Stockchase
Dream Office REIT (D.UN-T) — Stockchase

Dream Office vs. Dream Industrial Never a fan of Dream Office, which had a lot of Alberta exposure. He prefers the industrial side, which has performed better and faces little competition; there are only 3-4 industrial REITs in Canada. Hold both, don't buy or sell.

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Plaza Retail REIT (PLZ.UN-T)
They are developers with tenants like Shoppers Drug Mart. The trust specializes in shopping and retail in Atlantic Canada and Quebec. Analysts see a strong management team and their operations are seen to be best in class.

Plaza Retail REIT (PLZ.UN-T) — Stockchase
Plaza Retail REIT (PLZ.UN-T) — Stockchase

The retail space was in tough shape before the pandemic, it is only worse now. He would be leery of investing in a declining sector.

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Pure Multi-Family REIT LP (RUF.U-X)
Peter Imhof sees this REIT as a good defensive play with a good yield. A good play on the US demand on apartments that gives you some exposure to the US market. There was a take-over deal discussed recently and the company has struck a committee to facilitate a possible sale.

Pure Multi-Family REIT LP (RUF.U-X) — Stockchase
Pure Multi-Family REIT LP (RUF.U-X) — Stockchase

He has never really fully understood their business model. There has been a recent take out off for $7.61 US per share. This is a real offer and the money would be there. Prior to that they had worked with a third-party, so it is precluding them from engaging in the current offer. Looming in…

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InterRent REIT (IIP.UN-T)
Their main holdings are apartments in Toronto, Ottawa and Montreal. There are good fundamentals for apartments and dividend increases are expected to be announced in the coming years.

InterRent REIT (IIP.UN-T) — Stockchase
InterRent REIT (IIP.UN-T) — Stockchase

Likes it. Stock's performed really well. Q3 results strong. Trading at a 5% discount to NAV. Still upside. Primarily in GTA, Hamilton, Ottawa, Montreal. Buy underperformers and renovate them to the advantage of shareholders. Strong recurring free cashflow, growing distribution. Yield is 2.3%.

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Slate Office REIT (SOT.UN-T)
They recently cut dividends to rebalance to buy property in Chicago. There are some vacancies that they are struggling to fill in Toronto. They have a sustainable payout of nearly 10%.

Slate Office REIT (SOT.UN-T) — Stockchase
Slate Office REIT (SOT.UN-T) — Stockchase

He is not bull on the office space. They have been growing in sub-markets he is not keen on. 37% is in Atlantic Canada and he is not keen on their holdings.

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Boardwalk REIT (BEI.UN-T)
A well-known REIT that operates multiple communities including Boardwalk Communities, Structures Metropolitaines, and Boardwalk Retirement Community. They were affected by the slow-down in Alberta and are refocusing on Ontario.

Boardwalk REIT (BEI.UN-T) — Stockchase
Boardwalk REIT (BEI.UN-T) — Stockchase

Best of the apartment REITs. Trades at a big discount to NAV. Rent collection rate is 99%. They're defensive. Holdings in Alberta benefit from a high-growth rate in the general economy as oil comes back. (Analysts’ price target is $40.02)

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Slate Retail REIT (SRT.UN-T)
A grocery-anchored real estate investment trust in secondary markets in the U.S. midwest. A stable operation that is well-run. Managements are also large shareholders.

Slate Retail REIT (SRT.UN-T) — Stockchase
Slate Retail REIT (SRT.UN-T) — Stockchase

This would be a hold for him, if not a sell. It has US grocery stores in small centres. It has an external management contract, which he feels is not in alignment with share holders.

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Dream Industrial REIT (DIR.UN-T)
The industrial warehouse sector in general has been experiencing high demand. DIR.UN-T is well positioned to take advantage of this trend. They are adding value and the technological move will help grow the company.

Dream Industrial REIT (DIR.UN-T) — Stockchase
Dream Industrial REIT (DIR.UN-T) — Stockchase

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. In the current environment, industrial or residential REITs are preferable. It is fairly cheap and the distribution is safe. Unlock Premium - Try 5i Free

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Dream Global REIT (DRG.UN-T)
A lot of their focus is in Europe with lots of regulations. It is one of the top performing REITs that is considered more defensive. They pay a dividend of 5.9%

Dream Global REIT (DRG.UN-T) — Stockchase
Dream Global REIT (DRG.UN-T) — Stockchase

Really likes it. Agreed to be acquired by Blackstone. Wouldn't recommend it at this point. Doesn't see a higher bidder. Great opportunity to look at other Canadian REITs with global assets. Look at Granite REIT instead.

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Granite REIT (GRT.UN-T)
A global real estate operator composed mainly of former holdings of Magna International. Their balance sheet is looking good and they are well-positioned. They have a low payout ratio for a REIT.

Granite REIT (GRT.UN-T) — Stockchase
Granite REIT (GRT.UN-T) — Stockchase

A very good REIT. They spun out their Magna industrial assets and recent quarters have been strong. Growing well. It's defensive, not totally industrial though. He likes it. He is neutral/likes this.

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Allied Properties REIT (AP.UN-T)
A leader in the industrial space in Canadian cities. One of the highest quality Canadian REITs available. They are trading at a premium but is one of the more defensive securities.

Allied Properties REIT (AP.UN-T) — Stockchase
Allied Properties REIT (AP.UN-T) — Stockchase

Stockchase Research Editor: Michael O'Reilly AP.UN is a REIT that manages office space primarily in Toronto and Montreal. As vaccines are rolling out, we expect the worst is now over for this space, signaling a time to re-enter. It trades at less than 7x earnings and pays a good dividend backed by a 29% payout…

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Inovalis REIT (INO.UN-T)
A leading Canadian REIT stock that focus on owning and managing a portfolio of high-quality assets in Germany and France. They announced a purchase of a building in Germany recently.

Inovalis REIT (INO.UN-T) — Stockchase
Inovalis REIT (INO.UN-T) — Stockchase

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Management has a decent record although recent quarters saw some misses with 5 out of the last 8 missed expectations. Shares have done well since 2016 asides covid's impact. Insiders own over 20%. Unlock Premium - Try 5i Free

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Morguard North American REIT (MRG.UN-T)
A Canadian REIT stock that focus on high-quality multi-suite residential properties in Canada and the United States. They pay a dividend of 3.85%.

Morguard North American REIT (MRG.UN-T) — Stockchase
Morguard North American REIT (MRG.UN-T) — Stockchase

A hold. A value name in apartments in Canada and the U.S. He's impressed with how stable their Toronto portfolio is, holding occupancy quite well. MGR is in the US sunbelt and Chicago. MRG is higher-leveraged. He's seeking REITs that are defensive. He doesn't see as much growth here vs. the REITs he already owns.…

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Agellan Commercial REIT (ACR.UN-T)
A portfolio with US properties. They also operate in Toronto. Their specialty is acquiring and owning industrial, office and retail properties.

Agellan Commercial REIT (ACR.UN-T) — Stockchase
Agellan Commercial REIT (ACR.UN-T) — Stockchase

A portfolio of US properties. It also has some interesting properties around the DVP area in Toronto. The CEO is one of the few people that not only knows how to buy, but also how to sell. Thinks that at some point, he will sell the entire company if he can, or bit by bit.

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True North Commercial REIT (TNT.UN-T)
They announced a strong start to 2019 with an acquisition of Federal government tenant office property in downtown Ottawa. They pay a dividend of 8.93%.

True North Commercial REIT (TNT.UN-T) — Stockchase
True North Commercial REIT (TNT.UN-T) — Stockchase

He would avoid this one. Office space is difficult to re-tenant. They have an external management structure for their assets, which does not necessarily leave great alignment.

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Melcor REIT (MR.UN-T)
They are actively buying back stocks in order to have the present value reflect the intrinsic value. A stable company that remains well-positioned to capitalize on opportunities that are presented while Alberta recovers.

Melcor REIT (MR.UN-T) — Stockchase
Melcor REIT (MR.UN-T) — Stockchase

Dividend safe? They did a convertible debenture that he participated in. This is an Edmonton based land bank company. A longer term play. What tends to happen is goes quietly along for a while then they sell off an asset, which causes a spike up. It does not have a large enough dividend to hold…

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Partners REIT (PAR.UN-T)
A Canadian REIT stock that is based in Toronto. They operate in retail and mixed-use retail community and neighbourhood centres. They pay a strong dividend of 10.47%.

Partners REIT (PAR.UN-T) — Stockchase
Partners REIT (PAR.UN-T) — Stockchase

It is highly leveraged and the payout ratio is close to 100%, recently they cut the dividend and there was management turnover. There were a lot of complicated transactions, some of which were not arm’s length.

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Australian REIT Income Fund (HRR.UN-T)
The REIT focuses on the Australian market segment. The dividend is at 5.92%.

Australian REIT Income Fund (HRR.UN-T) — Stockchase
Australian REIT Income Fund (HRR.UN-T) — Stockchase

One of the only REITs that he still holds. He likes Australia. The problem with this one was when they first set it up, the Australian currency took a big hit right off the bat and that’s why it came down. They are now hedged. Great entry point at this level.

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United States
Vanguard REIT ETF (VNQ-N)
This US REIT ETF follows the general pattern across the industry. It is an extremely well diversified ETF and is one of the largest REIT funds.

Vanguard REIT ETF (VNQ-N) — Stockchase
Vanguard REIT ETF (VNQ-N) — Stockchase

He is talking about US REITS generally and using the Vanguard REIT ETF to show the pattern across the industry. The EFT was trading in a consolidation range ($80-85’s) all of last year, then there was a sharp drop. The ETF has been retracing but the price (now $75.88) is not close to where it…

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Market Vectors Mortgage REIT ETF (MORT-N)
A index fund that follows closely the “Mortgage REITs Index”. They pay a dividend of 7.19%.

Market Vectors Mortgage REIT ETF (MORT-N) — Stockchase
Market Vectors Mortgage REIT ETF (MORT-N) — Stockchase

Generally likes mortgages. You get higher yields and there is harder collateral security. You are a step removed from the volatility of underlying real estate prices. 30% of it is in two securities, which concerns him somewhat.

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Armour Residential REIT (ARR-N)
They had a disappointing first quarter but also announced that they are going to keep dividends the same. They focus primarily in fixed rate residential, residential mortgage-backed securities and U.S. Government-sponsored enterprises.

Armour Residential REIT (ARR-N) — Stockchase
Armour Residential REIT (ARR-N) — Stockchase

Around 14% is pretty typical yield for mortgage REITs. This owns Agency Mortgage REITs, both fixed and adjustable rates. If you look through the results of the capital raise they did recently, it was dilutive, so their book value per share was about $7 which dropped to $6.70-$6.80. He doesn’t like to see this. Core…

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SPDR DJ REIT ETF (RWR-N)
RWR is one of the oldest real estate ETFs on the market. They follow the Dow Jones U.S. Select REIT Index. They pay a yield of 3.68%.

SPDR DJ REIT ETF (RWR-N) — Stockchase
SPDR DJ REIT ETF (RWR-N) — Stockchase

US real estate ETF? Well diversified un-levered real estate investment.

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Partners REIT (PAR.UN-T)

Partners REIT (PAR.UN-T) — Stockchase
Partners REIT (PAR.UN-T) — Stockchase

It is highly leveraged and the payout ratio is close to 100%, recently they cut the dividend and there was management turnover. There were a lot of complicated transactions, some of which were not arm’s length.

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