Which REIT Should You Add to Your Portfolio? Three Dividend-Yielding Real Estate Plays Worth Considering

When it comes to building long-term wealth, few strategies beat collecting steady income from stocks that consistently raise their payouts. Real estate investment trusts have proven particularly adept at this, and three names stand out: Realty Income, Mid-America Apartment Communities, and Rexford Industrial Realty.

The Case for Income-Focused Investing

Historically, dividend payers have crushed their non-yielding counterparts in total returns. But here’s the secret sauce: those that regularly bump up their distributions perform even better. REITs occupy a special place in this universe because many have engineered business models specifically designed to expand payouts year after year.

These three companies have delivered exactly that track record, making them compelling candidates for investors hunting for reliable income streams.

Realty Income: The Predictable Income Machine

With 133 consecutive monthly dividend increases since going public in 1994, Realty Income operates like clockwork. That’s 113 consecutive quarters of hikes—a stretch that few companies anywhere can match.

The numbers tell the story. Its payout has climbed at a steady 4.2% yearly clip, translating to a current yield sitting around 5.7%. Over three decades, this has powered a 13.7% annualized total return.

What enables this consistency? A fortress-like balance sheet combined with a disciplined 75% payout ratio of adjusted funds from operations. This leaves plenty of dry powder to reinvest while maintaining dividend safety. The REIT boasts one of the sector’s strongest financial positions, ranked among the top 10 balance sheets.

The diversification story matters too. Realty Income spreads exposure across retail, industrial, gaming, and other property types throughout the U.S. and Europe, all wrapped in long-term net leases. The pipeline? Enormous. The company reviewed $97 billion in potential deals through Q3, converting just 4% into closures—a disciplined approach that’s paid off. With roughly $14 trillion in addressable net-lease real estate markets available, growth runway extends for decades.

Mid-America Apartment Communities: Steady Builder

After 16 straight years of dividend expansion, Mid-America Apartment Communities has compiled a track record that demands respect. The apartment-focused REIT has never cut its payout in over 30 years as a public company.

Payouts have expanded at a 7% compound annual pace over the past decade—well above average—currently offering a 4.5% yield. This consistency has supported a 9.6% annualized total return over 20 years.

The REIT maintains plenty of flexibility for future increases. A conservative dividend payout ratio and top-tier credit metrics mean capital remains available for growth. Development pipelines are substantial: seven properties under construction representing $800 million in investment coming online over the next few years, plus significant land acquisitions in Kansas City and Arizona earmarked for future phases.

Rexford Industrial Realty: Embedded Growth Story

Southern California-focused Rexford Industrial Realty has taken dividend growth to another level, posting a 15% compound annual increase over the past five years. At 4.2% yield, the fund trades at compelling valuations.

The growth story runs deep. Already-signed leases contain automatic rent escalators averaging 3.7% annually, which should inject $105 million in incremental net operating income over coming years. Add in repositioning and redevelopment projects currently underway—projected to contribute another $70 million once stabilized—plus capture of higher rents on lease renewals (conservatively worth $20 million more), and you’re looking at $195 million in additional NOI from existing assets alone. That represents a 28% boost before pursuing any new acquisitions.

This embedded expansion virtually guarantees dividend growth will continue flowing, assuming market conditions remain reasonable.

The Bottom Line

Dividend-paying equities form the cornerstone of patient wealth-building. When those companies systematically raise distributions, returns tend to accelerate over multi-decade horizons. Realty Income’s mechanical consistency, Mid-America’s steady expansion, and Rexford’s internally-driven growth each offer distinct merits—making all three worthy additions for income-seeking portfolios focused on the long game.