Thanks to their tax structures, real estate investment trusts (REITs) have long been a wonderful way for investors to boost their incomes and total returns through high dividend yields. Even better is when those REITs have been able to deliver strong dividend growth over the long haul as well, providing inflation-resistant growth for portfolios. Our latest Dividend Capture Pick is one such REIT, raising its payout steadily since the end of the Great Recession!
You can check out the Best Dividend Capture Stocks List to explore all the stocks.
The secret to our pick’s success has been its property type, as well as its operating regions. Our pick is one of the largest apartment owners in the nation, with nearly 60,000 units under its umbrella. That size and scope has allowed our pick to benefit from the rise of the renter nation and high mortgage rates. The best part is that those units are in economically diverse and strong areas such as San Francisco, New York City, Austin, and Nashville. This helps keep our pick’s occupancy rates high and their cash flows humming right along.
Growth has remained strong at our pick as well.
Our pick has continued to upgrade older complexes and buildings with new green and LEED certifications. This has helped drive higher rents for its properties. A new focus on energy efficiency and smart apartments has also helped increase rents beyond rates of inflation. An added benefit is that our pick has continued to be an efficient recycler of capital, selling older properties, while using the proceeds to develop new properties in other highly desirable areas. The end result is that our pick has steady and strong cash flow growth, all benefiting its shareholders.
As such, our pick has become a wonderful dividend capture play. A dividend capture strategy involves buying a stock before its ex-dividend date and then selling it after it has recovered the payout. With an ex-dividend date of Thursday, April 10, our pick is primed for the strategy, as is evident from its historical track record of a recovery period within an average of 3.2 days after going ex-dividend.
For investors looking for a quick total return of income and capital appreciation, our latest apartment REIT pick could be a lucrative option.
