Best Real Estate Stocks January 2024

The best real estate stocks for January 2024

Prologis, Inc. (PLD)

Why we chose it

Prologis, Inc. is a logistics real estate company that focuses on highly competitive and high-growth markets. It serves approximately 5,800 customers in the B2B and retail/internet commerce segments. At the end of 2022, Prologis owned or had investments in properties and development projects totaling 1.2 billion square feet in 19 countries. For 2022, the company had revenue of $5.97 billion, up from $4.76 billion in 2021. Net income was $3.36 billion, up from $2.93 billion in 2021.

American Tower Corporation (AMT)

Why we chose it

American Tower Corporation wasfounded in 1995, is a RIIT that owns, operates and develops wireless and teleradio communications, including over 221,000 communications facilities, of which 43,000 are located in the United States and Canada. The company has more than 5,600 employees in 22 countries. In 2022, AMT increased total annual revenue by 14.5% to $10.7 billion, while net income decreased 34% from the previous year to $1.7 billion.

Equinix, Inc.(EQIX)

Why we chose it

Equinix was founded in Silicon Valley in 1998 as a data center provider that allows competing networks to connect and exchange data traffic. The company became a RIIT in 2015 to gain tax advantages, and its currentglobal infrastructure is larger than the 10 largest competitors combined. The company provides customers with access to more than 1,800 network services, 2,900 cloud and IT services, 1,250 financial services and 600 content and digital media services.

Public Storage (PSA)

Why we chose it

The iconic orange and white 'Public Storage' sign is recognizable across the country, and for good reason. Public Storage opened its first self-storage facility in 1972 and has since become the largest owner and operator of such facilities in the world. The company owns nearly 2,500 self-storage facilities in the United States and Europe totaling more than 170 million square feet. Public Storage is one of the largest landlords in the world and serves more than one million customersin 38 states and seven European Union countries.

Crown Castle International Corp. (CCI)

Why we chose it

Crown Castle International is a REIT that owns, operates and leases more than 40,000 communications towers and 80,000 miles of fiber optic line, and offers services through a variety of models, including private ownership or collaboration with local governments or other partners. The company's infrastructure also supports more than 110,000 small cells and provides fiber solutions to all major markets in the United States. The company has set a goal of creating a reduced environmental footprint by implementing a shared infrastructure model that reduces the total number of towers, small cell networks, fiber optic lines and data centers required tocustomer provisioning. This reduction in infrastructure also has less impact on other resources such as water and energy.

Welltower Inc. (WELL)

Why we chose it

Welltower is a healthcare REIT founded in 1970. The company owns and operates healthcare, including senior living facilities, post-acute care facilities, and outpatient healthcare services. In 2018, the company completed the acquisition of Quality Care Properties, HCR ManorCare and Arden Courts, previously the second-largest provider of post-acute care and long-term care services in the U.S.

Simon Property Group, Inc.(SPG)

Why we chose her

Simon Property Group is a REIT that owns, manages and develops retail, restaurant and entertainment properties. The companyis one of the largest owners and operators of such businesses in the world. in North America - 37 states and Puerto Rico - as well as in Europe and Asia. In addition to being the largest mall operator in the U.S., SPG also owns and operates premium outlet and lifestyle centers and has overseas facilities. With a total of over 23,274 specialty stores in their portfolio, the company generates $60 billion in annual sales in the U.S. from 3 billion annual customers.

Realty Income Corporation (O)

Why we chose her

Realty Income Corp is a REIT that was founded in 1969 with the primary purpose of providing investors with a monthly income that will grow over time. Realty Income dividends are paid out of income,received from rental properties, and since going public in 1994, the company has grown its portfolio to more than 11,000 properties in all 50 states (as well as Puerto Rico, the United Kingdom and Spain). Like the other companies on this list, Realty Income is working hard to reduce its environmental footprint, including the launch of its Green Financing Framework program to raise capital to acquire and develop green building-certified buildings and projects that contribute to their sustainability goals.

Digital Realty Trust, Inc.(DLR)

Why we chose it

Digital Realty Trust is a REIT that owns and operates carrier-neutral data centers and provides acloud-based enterprise solutions. Founded in 2004, Digital Realty provides colocation and node-based traffic exchange services to customers around the world. The company operates over 290 data centers in 26 countries on 6 continents.

Vici Properties Inc.(VICI)

10-year average annualized return

Why we chose it

Vici Properties is a relatively new REIT that emerged from the bankruptcy of gaming company Ceasars Entertainment in 2017year. The old Ceasars Entertainment company famously owned the Caesars Palace casino in Las Vegas, as well as other gaming and hotel properties across the U.S., and underwent numerous corporate reorganizations before it filed for bankruptcy in 2015. Today, Vici owns more than 50 hotel, casino, track and golf course properties in the United States and Canada. The company does not operate these hotel properties, but contracts with third parties to operate them.

Types of real estate stocks

Like any sector of the stock market, real estate stocks can be divided into sub-sectors according to their business. The real estate sector is usually divided into the following sub-sectors:

• residential. Residential real estate stocks are companies,Specializing in owning and leasing residential properties for tenants, including apartments, condos, and luxury housing.
• Commercial. Commercial real estate stocks primarily relate to the ownership, management, or development of office or retail space to accommodate various types of businesses.
• Healthcare. Healthcare real estate stocks buy, build, or manage healthcare, including senior living facilities, assisted living facilities, and post-acute care centers.
• Specialized stocks. In addition to REITs that invest in core real estate types, there are also stocks that invest in entertainment spaces (e.g., arenas) and othersites.

In addition to the various types of real estate stocks that own, manage or develop physical properties, there are also stocks that invest in operations indirectly related to real estate. This includes companies such as mortgage REITs that invest in various mortgage-backed bonds.

The benefits of investing in real estate stocks

• Diversity. Real estate stocks give investors the opportunity to invest in an entire portfolio of properties represented in a single stock.
• Professional management. Real estate management companies offer shareholders professional management that is designed to maximize shareholder value by managing thethe company's real estate portfolio.
• Liquidity. Openly traded real estate stocks give investors the ability to invest in physical real estate without having to select, acquire, and manage the properties themselves. In addition, investors can sell shares much more easily if they need money.
• Tax advantages. Companies that earn passive income from rental real estate inherit several key tax advantages.
• Regular income. Investors who own shares of REITs typically receive regular dividends based on the size of their investment.

The risks of investing in real estate stocks

• Management costs. It's true that real estate shareholdersreceive professional management, but that management has a cost. The salaries and benefits of company managers can significantly reduce a real estate company's net operating income.
• Moderate growth. Unlike technology stocks and some more volatile investments, REITs have traditionally been low-yielding. Their primary value to shareholders usually comes from regular dividends.
• Interest rate risk. Because real estate companies often finance their portfolios with loans, changes in interest rates create risks for investors. When interest rates rise, a company may generate less net income that can be paid out as dividends.
• Possiblemarket downturns. Real estate markets periodically experience downturns, especially during recessions. Recent examples include the 2008 financial crisis and commercial real estate during the Covid-19 pandemic in 2020 and 2021.

How to buyreal estate stocks

Investors who want to purchase real estate stocks can do so through a brokerage account or a tax qualified retirement account such as an individual retirement account (IRA). In some cases, investors may even be able to invest through a corporate 401(k) retirement account. If you don't already have a trading account or are looking for a new trading platform, check out our list of the best online brokers and best investment apps. You should alsoremember that investing in individual stocks, even those backed by physical assets such as real estate, is significantly riskier than buying a diversified fund. It is therefore crucial for investors to thoroughly research companies and assess their financial position before investing.