3 Dividend Aristocrat REITs

Investors who are considering buying Real Estate Investment Trusts, or REITs, should not only look at the dividend yield as the only reason for purchasing. Many REITs have high yields, but sometimes an extremely high yield can be a sign of deteriorating fundamentals. Income investors should avoid dividend cuts whenever possible.

One way to do this is to focus on stocks with long histories of dividend growth. Even among REITs, there are a select few that have raised their dividends for more than 25 consecutive years. The 3 REITs currently on the Dividend Aristocrats list are below:

  • Essex Property Trust (ESS)
  • Realty Income (O)
  • Federal Realty Investment Trust (FRT)

This article will discuss these 3 Dividend Aristocrat REITs in greater detail.

Dividend Aristocrat REITs


Dividend Aristocrat REIT: Essex Property Trust

Essex Property Trust is a residential REIT that owns multi-family apartment communities located in West Coast markets, primarily California and Washington. It has targeted 8 specific coastal markets in California and Washington. These are cities with large populations and economic growth. Essex has ownership interests in nearly 250 apartment communities consisting of over 60,000 apartment homes.

There remains limited supply in these core markets. This has led to stable results for Essex, even in the current challenging environment. In the 2021 second quarter, Essex’s core FFO-per-diluted share declined 3.8% to $3.04 from $3.16 year-over-year. Same-property gross revenue fell by 3.0% and same-property net operating income fell by 4.2% from Q2 2020. 

Essex’s recovery is gaining strength. Essex also raised its forecast for same-property revenue growth and core FFO-per-share for the full year. Consensus analyst expectations prior to the COVID-19 outbreak were for mid-single digit growth in FFO per share between in the coming years. We conservatively estimate mid-single-digit growth over the next five years from 2021 through 2026.

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