3 REITs to Buy for Retirement: July 2024
Real estate investment trusts (REITs) represent one of the best ways to get exposure to investing in real estate without having to take on the risks and capital expenditures of purchasing your own property. When buying into a REIT, investors are essentially giving their money as a loan to a capital management firm, which then invests that money into further property as the value of that property grows so two does the dividend yield of the REIT lowering it to provide comfortable returns on the original investment made.
Yet with all of the REITs on the market, it can be difficult to determine which ones are the right ones to buy for the long term. This is exceptionally important to know when preparing a retirement portfolio and keeping a close eye on the best REITs to buy for retirement is critical for hedging against the impending dissolution of Social Security, and pervasive inflation the dollar is facing today. As such, here are three well-diversified and well-positioned REITs to buy for an easier retirement.
Boston Properties (BXP)
Starting off this lift of REITs, Boston Properties (NYSE:BXP) started off with a fairly straightforward premise: investing in Boston office buildings. Today, the company represents one of the largest REITs in the United States, with millions of square feet of commercial and retail space under its management.
One aspect that sets BXP’s REIT management apart, however, is its focus on sustainably built structures. As part of this initiative, the company has set a goal of achieving Leadership in Energy and Environmental Design (LEED) for its entire portfolio. Beyond being good for the environment, this reduces much of the wear and expenses on its properties, keeping them more affordable to operate and maintain.
Furthermore, despite the broader trend of commercial real estate devaluation due to office space supply remaining high with demand stagnating, BXP has found a niche with its well-located and flexibly designed office buildings. This has allowed the REIT to maintain a 5.87% yield for investors, which automatically makes it a solid pick for long-term play.
Healthpeak Properties (DOC)
Perhaps one of the most stable forms of property development, healthcare buildings have become lucrative investing vehicles due to the increasingly monetized nature of the American healthcare system. As a result, a highly specialized REIT such as Healthpeak Properties (NYSE:DOC) continues to trade steadily and keep shareholders happy through dividend provision.
Thanks to the increasing demand for hospital space and the generally uncommon occurrence of its decreasing property value, buying into hospital structures can be steadily lucrative over time. That’s because hospitals are exceptionally utilitarian and are built with decades not centuries of service provision in mind.
Thus, the 5.74% yield provided by Healthpeak could be a strong compounding force for your retirement savings. Moreover, DOC stock doesn’t face the same broader real estate pressures that the average REIT is facing since hospital space and infrastructure demand is growing parallel to population increase in the United States.
Ventas (VTR)
Another healthcare REIT with a broad focus on senior care facilities, Ventas (NYSE:VTR) has the makings of some of the best REITs to buy for retirement. It has several subspecializations across several healthcare categories such as assisted living, memory care, research institutions, and medical offices. Much like Healthpeak, Ventas’ strength lies in the long-term relevance of its various properties. That’s because all people will inevitably age and some will need more care than others while medical research and healthcare provision will always be central to the global economy.
That said, Ventas does provide a lower yield than Healthpeak at 3.38% but for much more portfolio diversity. This means it represents a broader form of REIT investing. Moreover, the company operates across the United States, Canada, and the United Kingdom, representing its commitment to functioning across several different healthcare systems and increasing its potential for expansion down the road.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
On the date of publication, Viktor Zarev did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
