Best Canadian REITs

by Avrex on February 20, 2013

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Real Estate Investment Trusts, with their nice income yields, continue to be popular with investors. Avrex Money has compiled and ranked a complete list of all the Canadian REITs on the Toronto stock exchange (TSX).

Avrex Price/ Payout
Rank Company Ticker Yield AFFO Ratio REIT Sector
1 Artis REIT AX.UN 6.82% 14.66 91.7 Diversified I (Off/Ind/Ret)
2 Morguard Real Estate Inv Trust MRT.UN 5.09% 19.53 81.7 Commercial
3 First Asset Canadian REIT RIT.UN 4.67% - 26.8 Fund
4 Northwest Healthcare Prop REIT NWH.UN 6.04% 16.56 94.5 Retire/Health
5 Retrocom Mid-Market REIT RMM.UN 8.17% 12.24 117.5 Retail
6 Cominar REIT CUF.UN 6.29% 15.74 93.0 Diversified I (Off/Ind/Ret)
7 Dundee International REIT DI.UN 6.93% 13.89 96.4 Commercial
8 Dundee REIT D.UN 5.81% 17.03 92.1 Office
9 Partners REIT PAR.UN 8.10% 12.34 106.0 Retail
10 Boardwalk REIT BEI.UN 3.00% 33.64 71.3 Residential
11 BTB REIT BTB.UN 8.61% - 27.4 Diversified I (Off/Ind/Ret)
12 Primaris Retail REIT PMZ.UN 4.67% 21.79 93.9 Retail
13 Timbercreek Global Real Estate TGF.UN 6.41% - 44.6 Fund
14 Calloway REIT CWT.UN 5.34% 18.68 89.8 Retail
15 Brookfield Canada Office Prop. BOX.UN 4.00% 24.71 92.9 Office
16 H&R Real Estate Invest. Trust HR.UN 5.90% 16.90 90.0 Diversified I (Off/Ind/Ret)
17 Pure Industrial Real Estate AAR.UN 5.94% 16.92 84.3 Industrial
18 Northern Property REIT NPR.UN 4.82% 20.49 77.5 Residential
19 RioCan Real Estate Investment REI.UN 5.14% 19.63 97.6 Diversified II (Office/Retail)
20 Allied Properties REIT AP.UN 3.88% 25.83 82.9 Office
21 Canadian Apartment Property (CAP REIT) CAR.UN 4.26% 22.55 85.1 Residential
22 REIT INDEXPLUS Income Fund IDR.UN 6.56% - - Fund
23 Crombie REIT CRR.UN 6.05% 16.53 98.6 Diversified II (Office/Retail)
24 InterRent REIT IIP.UN 2.60% 37.33 54.2 Residential
25 Cdn. Real Estate Investment REF.UN 3.30% 29.61 63.1 Diversified I (Off/Ind/Ret)
26 Chartwell Retirement Residence CSH.UN 4.98% 20.03 76.2 Retire/Health
27 Morguard Sunstone Real Estate MSN.UN 5.52% - 178.1 Fund
28 InnVest REIT INN.UN 9.28% - 51.2 Hospitality
29 Temple Hotels TPH 8.38% - 86.0 Hospitality
30 KEYreit KRE.UN 9.01% - 239.5 Retail
n/a Loblaw’s Choice Properties REIT CHP-UN - - - Retail
n/a Agellan Commercial REIT ACR.UN - - - Diversified I (Off/Ind/Ret)
n/a American Hotel Income Properties REIT LP HOT.UN - - - Hospitality
n/a Canadian REIT Income Fund RIU.UN 4.81% - - Fund
n/a Connor Clark & Lunn Real Ret RRB.UN - - - Fund
n/a Dundee Industrial REIT DIR.UN 6.08% - - Industrial
n/a HealthLease Properties REIT HLP.UN 7.71% - - Retire/Health
n/a Holloway Lodging REIT HLR.UN - - - Hospitality
n/a Huntingdon Capital HNT - - - Diversified I (Off/Ind/Ret)
n/a Lanesborough REIT LRT.UN - - - Residential
n/a Middlefield Can-Global REIT RCO.UN 6.37% - - Fund
n/a Morguard North American REIT MRG.UN 5.13% - - Residential
n/a N.W. Intl Healthcare Prop.REIT MOB.UN-X 7.44% - - Retire/Health
n/a North American REIT NRF.UN 6.19% - - Fund
n/a Pure Multi-Family REIT LP RUF.U-X 7.11% - - Residential
n/a True North Apartment REIT TN.UN-X 7.08% - - Residential
n/a US Agency Mortgage-Backed REIT USM.UN - - - Fund

Avrex Rank – Is derived based on several valuation metrics. For illustration purposes, only two of those metrics are listed in the table above. A rank of ‘n/a’ indicates that there is insufficient data for a ranking.
P/AFFO – Price per ‘Adjusted Funds From Operation’. A lower number is better for this valuation metric.
Payout Ratio – Expressed as a percentage. A lower number ‘could’ indicate a safer distribution payout.

Asset Allocation

As an individual investor, where do REITs fit within your portfolio?

The Avrex Money portfolio has 6 % invested in REITs. This consists of owning individual REITs as well as owning the following REIT Index ETFs for further diversification:

By way of comparison, large pension funds hold 9 % of their assets in real estate. Considering that many individual investors also have real estate, in the form of home ownership, I feel that the 6 % allocation to REITs is adequate.

Since REITs are not highly correlated to the movement of equities, they provide effective diversification within your portfolio. REITs are great long-term holdings in your retirement account.

[Disclaimer: The above rankings are opinions only and should not be considered investing advice. Perform your own due diligence. Contact a professional before making any investing decisions.]

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{ 11 comments… read them below or add one }

My Own Advisor February 20, 2013 at 10:09 AM

Great post. Surprised that CWT and REI are not higher on the list….these are great REITs.

I also like your call on Vanguard ETFs for REITs, but iShares has a nice product as well: XRE even though the MER is higher. I’ve owned XRE for 5 years, loved the returns.

Cheers,
Mark

Reply

Avrex February 21, 2013 at 12:29 AM

thanks MOA.
Your REI and CWT are two of the largest REITs in Canada. I would agree with you that they are very solid REIT companies that are worthy of investment. But, yes, some of the smaller REITs bubbled their way past them, to the top of my list.

Reply

IKan February 21, 2013 at 5:23 PM

So how is the list arranged????
It is not by yield, price, AFFO, Ratio, alphabetically….??

IKan, not figure it out.

Reply

Avrex February 22, 2013 at 2:00 AM

The ranking is proprietary. The table only lists two of the metrics that are used in the overall ranking.

Reply

Bet Crooks February 22, 2013 at 9:04 PM

3-6% in REITs seems reasonable if you have a good chunk of your net worth in personal/residential real estate. Diversifying by buying REITS in commercial and industrial properties may help too.

Reply

Bernie February 23, 2013 at 1:00 PM

It would be interesting to also have a percentage distribution growth metric in your table.

Reply

Avrex February 23, 2013 at 1:38 PM

Yes, perhaps that could be added in a future update to this table.

Reply

gibor February 25, 2013 at 1:33 AM

Great post!
I couldn’t find something similar about 2-3 weeks ago when wanted to add couple of REIT in my TFSA. Mostly I considered AFFO payout and yield withon big REIT. First 3 on my list came: AX, CUF and D, so bought first 2.
Also holding PMZ for couple of years and pretty happy with it.
btw, I`m 10% in REIT

Reply

Jaycee September 27, 2013 at 3:48 PM

How do REITS react to rising interest rates? I’m old and I need a “sure” bet.

Reply

asp January 4, 2014 at 12:15 PM

How about an update to this article? Valuations have changed alot over the last 10 months, and there are some interesting new players in the field.

Reply

Avrex January 4, 2014 at 3:33 PM

Coming soon! :)
We try to update this list annually with the latest valuations. And yes, we’ll be looking at some of the new players too.

Be sure to sign up for the free email updates, so you don’t miss the next update (hopefully in February).

Reply

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