Real estate investment trusts are falling as the sector continues to decline, as the Vanguard Real Estate ETF VNQ is down about 31% year-to-date. With the REIT sector back down to levels not seen since January 2019, now may be an opportune time to scoop up undervalued shares.
This is especially true with REITs as they tend to surpass all other asset classes, providing an annualized total return of 10.8% from 1992 to 2017. In the near term, rising rates and inflation can cause a sticky situation for real estate investment trusts, so it may be wise to switch to shopping center REITs, as consumers will always need necessities such as groceries.
Learn more about these two high-yielding REITs that are benefiting from shopping centers in the United States.
Regency Centers Corp. REG is offering a dividend yield of 4.72% or $2.50 per share, utilizing quarterly payments, with a track record of increasing its dividends once in the past year. Regency Centers is the largest shopping center-focused retail REIT, with 80% of properties featuring a grocery and grocery store representing 20% of its annual base rent.
Since the IPO of 9.73%, Regency Centers has an interest in 404 properties, which includes more than 54 million square feet of retail space. Six of the top 10 tenants of the Regency Centers are grocery stores such as Kroger Co KR, Publix, and Amazon.com Inc's AMZN subsidiary Whole Foods.
Acadia Realty Trust AKR is offering a dividend yield of 5.58% or 72 cents per share annually through quarterly payments, with an inconsistent track record of increasing its dividends. Acadia Realty Trust has approximately 192 properties as of Sept. 27, 2022, which is a real estate investment trust that specializes in the operation, management, leasing, renovation, and acquisition of shopping centers and mixed-use properties with retail components.
Our operating results exceeded expectations, and we finished a strong quarter. Kenneth F. Bernstein, president and CEO of Acadia Realty Trust, stated that the strength continues to play out over the next several years with the continued momentum in Street retail.