Alternative Real Estate Income: Collect The Rent Checks Without The Hassle Of Being The Landlord

The Crown Castle International portfolio consists of more than 40,000 cell towers, approximately 70,000 on-air or under-contract small cell nodes, and about 80,000 route miles of fiber.

For investors, Crown Castle has been a solid dividend growth stock.

The company targets 7% to 8% long-term growth of the dividends per share.

Easterly Government Properties (DEA) is exclusive in its niche, with a portfolio 100% dedicated to U.S. Government Agencies through the General Services Administration.

Easterly currently owns 74 properties and adds a few each year to the portfolio. Management projects the REIT will double its portfolio over the next decade.

Easterly’s appeal is that it has a tenant that will always make lease payments. Dividend growth has been slow since the 2015 IPO. Again, the focus here is on the strength of having the U.S. government as your primary tenant.

Currently, the shares yield 4.4%.

The Pacer Benchmark Data & Infrastructure Real Estate SCTR ETF (SRVR) owns a portfolio of data center and telecom infrastructure REITs. Crown Castle International, discussed above, is its third-largest holding. This fund is the REIT equivalent of a tech stock ETF.

While many REIT groups crashed early in 2020 as the economy shut down, SRVR returned 22.37% for the 12 months ending on June 30, 2020.

The ETF has $800 million of assets. The weighted average market cap of the portfolio is $41 billion.

The current yield is 2.8%.

The Hoya Capital Housing ETF (HOMZcovers all aspects of homeownership or rental.

The portfolio breaks down to 30% in residential REITs and real estate operators, 30% in homebuilders and home building products, 20% in home improvement and furniture retailers, and 20% in mortgage lenders, title and mortgage insurance companies, and real estate technology companies. I think they have the housing universe covered.

The ETF is relatively new, with an IPO in March 2019. HOMZ pays monthly dividends, but the yield of 2% is just icing on the cake to have the housing sector covered with a single investment.

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