These REITs are adapting to the new market

Article Excerpt

RioCan and H&R continue to build new residential and industrial properties to cut their exposure to the retail industry. Their new properties—along with store reopenings as the pandemic eases—should help both REITs raise their distributions in the next few years. All in all, each trust remains attractive thanks to high-quality properties and tenants. RIOCAN REAL ESTATE INVESTMENT TRUST, $22.60, is a buy. The REIT (Toronto symbol REI.UN; Units outstanding: 317.7 million; Market cap: $7.2 billion; TSINetwork Rating: Average; Dividend yield: 4.3%; offers you a stake in 223 shopping centres and other properties across Canada. They include 15 projects under development with a focus on the residential segment, including condos/townhouse and apartments. Its overall occupancy rate is a high 96.0%. Due to new COVID-19 lockdown orders in Ontario and other provinces, RioCan’s revenue in the first quarter of 2021 fell 3.3%, to $276.80 million from $286.26 million a year earlier. Despite the shutdowns, the trust still collected 93.9% of rents in the…

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