Top 10 REITs (Real Estate) Stock To Invest In (December 2025)

The Other Large Asset Class

Real estate is a larger asset class than either stock or bonds. It is also a category that is perceived as difficult to invest in, as owning real estate usually means having to find and manage tenants, deal with renovation and maintenance, obtain a mortgage at a bank, etc.  It might also take months or years before managing to sell a property.  An alternative is REITs (Real Estate Investment Trusts), publicly traded stock of companies managing thousands or even tens of thousands of real estate assets.

REITs provide much higher liquidity, with the possibility to buy or sell their shares in a day and diversification.  REITs are legally mandated to distribute 90% of their taxable income in dividends to their shareholders. So, they are also a good option for building an income-focused portfolio.

Flats, Houses, Malls, And Others

Many REITs own what people think about first when they hear about investing in real estate. Flats, houses, or maybe commercial real estate like shops and malls. While this makes a large part of the REITs’ offer, there are also a lot of more specialized REITs.

Some are specialized in industrial properties, logistics, or technical services like cell phone towers and data centers. Others will own mostly land used for farming or forestry. So, investing in REITs can also give access to types of real estate assets that would not be investable directly for most investors.

Rising Rates

A question hanging over the real estate markets is the rising interest rates. In theory, the higher the rates, the lower the real estate price. In practice, it can be a lot more complicated, especially with inflation having increased drastically the replacement costs of existing buildings.

Source: Trading economics

Most likely, it is REITs and real estate companies needing massive refinancing, which will be hurt by higher interest rates. Companies that have locked in cheap capital might to the contrary see part of their debt “reimbursed” by inflation and benefit from the new inflationary context.

Top 10 REITs (Real Estate) Stocks To Invest In

1. Prologis, Inc.

Prologis, Inc. (PLD -0.34%)

Prologis is a massive logistic company that grew together with e-commerce and the need for warehouses it created (3x more than brick-and-mortar retail). It currently registers an all-time high occupancy, with 98% of its rented capacity.

At one point or another, 2.8% of the world’s GDP passes through Prologis’ warehouses and distribution centers, with a total footprint of 1,213 million square feet, serving 6,600 customers.

The company provides logistic assets to almost all the major global corporations in almost every industry.

A strong advantage of Prologis is that warehouses are just 3-6% of supply chain cost. So, for its clients, this is never a focal point of cost-cutting and, instead, something best subcontracted, while capital can be used for more strategic needs.

Prologis is remarkably efficient, with G&A (General and administrative expenses) at only 0.3%, thanks to its massive scale and past investment in scalable technologies.

Source: Prologis 

It is the 2^nd largest corporation with on-site solar production in the US, with a total of 410 MW of capacity installed. Prologis also has at its disposition a land bank (undeveloped lands) sufficient for $38B of investment.

The company is unlikely to suffer from rising rates or inflation, as its debt / adjusted EBITDA stood at 4.3x, with $5.7B in liquidity and the average interest on its debt at 2.6%, and 9/10^th of its at fixed rates.

Prologis is a stock for investors looking for exposure to the overall economy and trade, with the company’s scale giving it an edge in both efficiency and the ability to raise capital at the lowest possible cost.

2. American Tower Corporation

American Tower Corporation (AMT +0.92%)

Cell phone towers nowadays are owned by third parties, renting out the tower to multiple telecom operators. This allows the telecom companies to share the costs of the tower, making the whole industry more efficient in the process.

American Tower is the largest operator of such facilities, with 226,000 communication sites, 42,000 in the US & Canada, and 184,000 worldwide. Its largest international markets are in India (more towers than in any other country, including the US), Germany, Spain, Latin America, and Africa.

Source: American Tower Corporation

The company is benefiting from the growing demand for mobile bandwidth, with 5G deployment and the emergence of IoT (Internet of Things) expected to keep this trend ongoing. Overall, American Tower forecasts that total mobile data usage in the US will almost triple between 2023 and 2028, with a similar trend in the rest of the world.

Source: American Tower Corporation

With American Tower, investors gain exposure to a critical telecom infrastructure with a strong economic moat and a market still experiencing aggressive growth.

The international exposure of American Tower is also attractive, as it puts it in the position of capturing the increasing penetration of the Internet in developing countries. In the long run, American Tower’s long history of successful acquisitions should also help it enter new markets.

3. Equinix, Inc.

Equinix, Inc. (EQIX +0.6%)

Equinix provides digital infrastructure in the form of data centers and associated services. In total, it manages 250 data centers and is planning to open 57 others.

Virtually every company with a massive need for cloud services or reselling cloud services is working with Equinix, including Amazon, Microsoft, Google, and Netflix. This is largely due to industry-leading uptime performance (period without interruption of services) of 99.9999%.

Source: Equinix

Equinix has shown steady growth, with 14% revenue growth year-to-year in Q2 2023. The company derives its revenues from North America ($890 in Q2 2023), EMEA ($687M), and Asia ($442M).

Equinix has generated a “10-year total annualized equity return including reinvested dividends as of YE 2022 of  ~15%” and has also grown its dividend for the last 8 years since its conversion into a REIT in 2015.

Equinix has a 3.6x net leverage ratio, but with debt maturing on average in 8.1 years and borrowing rates of 2.18%, with only 1/20^th not fixed rate debt.

The case for Equinix stock is the same as for the cloud industry as a whole, with Equinix, a key partner in creating “virtual” real estate for almost all major corporations, either directly or indirectly, through all the major cloud providers like Amazon’s AWS. Its expertise also allowed it to attract top talent and to build data centers at scale, optimizing its operations and supply chain to the maximum.

4. Welltower Inc.

Welltower Inc. (WELL +0.09%)

Welltower real estate consists of healthcare facilities, like medical offices, senior housing, and rehabilitation centers (medical care out of hospitals). Welltower manages 1,400 properties in the US, Canada, and the UK.

Demographic changes with an aging population are boosting the company’s activity, with occupancy increasing by 1.9% year-to-year in Q2 2023 and net operating income growing by 24.2%. This is helped by a decline in senior housing growth despite the growing demand.

Source: Welltower

Welltower is quickly expanding through acquisitions, with $3B worth of assets already acquired or in progress in 2023. This follows previous aggressive expansion plans, with no less than $11B of capital deployed since the end of 2020. In that context, Welltower is looking to profit from temporary distress in real estate assets and trying to buy them at a discount from large financial institutions like Fannie Mae.

The company is also aggressive in its deleveraging plans, even if the current debt / EBITDA is still high at 5.5x, with variable debt at 13.2% of total debts.

Welltower is a niche REIT operating in a sector permanently supported by the aging of the baby boomer generation, which is now getting to the age of selling their house, moving into senior facilities, and needing more healthcare. This supports Welltower by growing the market and improving the unit economic per room rented. The company has a long acquisition history and is likely to become one of the largest actors in the growing healthcare & senior facilities REITs sector.

5. VICI Properties Inc.

VICI Properties Inc. (VICI +0.63%)

VICI is a REIT centered on casinos, other gaming/gambling properties, and gold courses.

It handles 124 million square feet, 60,300 hotel rooms, and 450+ bars, restaurants, nightclubs, and sportsbooks. Among the crown jewel of VICI assets are 3 casinos in the Las Vegas Strip: Caesars Palace Las Vegas, MGM Grand, and the Venetian Resort Las Vegas. Around half of the properties are in Las Vegas, and the rest are in many locations in the US and Canada.

VICI was the 4^th largest REIT IPO in 2018 and has grown its EBITDA 4-fold since. VICI was also added to the S&P500 index in June 2022, making it one of the stocks automatically purchased by passive investors into this very popular US index.

One of the largest portions of the company’s debt is a $5B investment-grade bond due in 2032. So, while the company debt is rather high, the payment schedule should make it relatively short and medium-term safe.

Source: VICI

VICI has plans to expand internationally, but for now, it is mostly focused on North America. Obviously, the company profits are tightly correlated to the health of the gambling industry and luxury spending in general. So, while it has benefited from international tourism and the growing wealth of the top 1%, it could equally come under pressure if the wealth gap shrinks.

6. AvalonBay Communities, Inc.

AvalonBay Communities, Inc. (AVB +0.08%)

AvalonBay is a REIT-owning residential property with a predilection for the most dynamic areas with high employment levels, high quality of life, and “lower housing affordability.” Or, more plainly, expensive areas with well-paying jobs and expensive real estate.

It owns 88,659 apartment homes in 13 states, in 294 apartment communities.

Source: Avalon

Occupancy is standing at 96% and remains stable, with rental revenues having grown by 6.5% year-to-year. The properties are diversified, with a mix of urban and suburban, and mostly mid-rise and small multi-family buildings.

AvalonBay’s high-end market has proven profitable, with 11.3% CAGR performance since its IPO and 4.8% annualized dividend growth.

The company’s rental offer is complemented by AvalonConnect, a fully integrated connectivity service with Internet, WiFi, and Smart Home systems, increasing the convenience of its rental for white-collar professionals, especially with the rise of Work From Home (WFH).

Between its locations on the coasts and its focus on high earners, AvalonBay has likely benefited from the tech boom of the last decade and the record stock market price levels. So, this is something to keep in mind for investors, as any serious trouble in these sectors could lead to less demand for AvalonBay apartments.

7. Alexandria Real Estate Equities, Inc.

Alexandria Real Estate Equities, Inc. (ARE -0.33%)

Alexandria develops and then rents out real estate to the life science and AgriTech industry, like research labs, testing facilities, etc… that come already fully equipped. It currently has around 1,000 tenants on its 74.6 million square feet of real estate, spread between 432 properties.

Alexandria facilities are located in the main American innovation clusters in California, Seattle, and the Northern East Coast.

Source: Alexandria Real Estate

The company is benefiting from the boom in new biotech technologies like RNA therapies, gene therapies, and other innovations in the sector. Providing a flexible lab and research facilities space also allows pharmaceutical and biotech companies to vary their footprint depending on new projects and the success of their R&D efforts. Alexandria is a key partner of these companies, happy to focus their capital on developing and selling drugs instead of real estate capex.

It also provides Alexandria with one of the highest EBITDA margins in the REIT industry, standing at 69% in 2022.

Source: Alexandria Real Estate

The tenants are from all life science industry sectors, with a large segment comprising large corporations and institutional research, making it not very sensitive to VC capital availability, which could have been a concern in a biotech sector known for its cyclicality.

Source: Alexandria Real Estate

The company has adopted a cautious approach to financing, with a relatively high level of debt (5.1x of EBITDA) but also a very long duration, with the remaining debt term reaching 13.2 years, no maturity before 2025, and financed with just 3.53% interest rate, virtually all at fixed rates.

Biotechnology is now reaping the fruits of decades of genomics and RNA technology development. So, it is likely that the biotech R&D efforts will only intensify from here, providing plenty of growth opportunities for Alexandria.

8. Vornado Realty Trust

Vornado Realty Trust (VNO -0%)

One sector of real estate that has not performed well during the pandemic and after is office space. Lockdowns and then Work From Home (WFH) have seemingly permanently reduced office demand.

Vornado is a REIT specializing in office space, mostly in Manhattan but also a little in San Francisco and Chicago. Vornado owns 19.9 million square feet of office space in 30 properties, as well as 2.5 million square feet of street retail space and 1,663 residential units.

While the sector is experiencing a crisis, it is unclear if prime real estate like downtown NY will be affected the same way as offices in secondary locations. With the stock down almost 75%, it is also possible that this is already more than priced-in.

A major growth driver for Vornado will be the ongoing re-development of the Penn district, centered around the Penn train station and the Madison Square Garden. It is recently becoming a new tech cluster, with companies like Amazon, Meta, Apple, and Samsung opening offices there.

Source: Vornado

Vornado is an investment for contrarian investors. They will need to focus on still solid FFO (Funds From Operations), the success of the Penn redevelopment, and count on the thesis that office spaces in the most important financial center in the US will still be in high demand moving forward.

9. Innovative Industrial Properties, Inc.

Innovative Industrial Properties, Inc. (IIPR +0%)

Sometimes, REITs’ main appeal to their clients is their access to cheap capital to build or purchase real estate, which can then be rented out. This is the case for IIPR, as it caters to the legal cannabis industry in the US.

Cannabis is still an illegal drug at the federal level, and almost all cannabis companies are unable to access capital from banks and institutional investors. This means that they frequently need to pay up to 10-15% interest rates on any loans they manage to secure.

But modern legal cannabis cultivation is a highly capital-intensive industry, requiring millions of square feet of very advanced greenhouses. So, IIPR provided them with greenhouses that would have been a lot more expensive. Would the cannabis companies have had to build them themselves?

Source: IIPR

In addition, IIPR’s scale and expertise allow it to build at cheaper costs and provide valuable technical expertise in indoor agriculture topics like humidity management, pest control, air cleaning, and chemical extraction.

IIPR is present in 19 US states and is notable for very long lease terms of 15-20 years. It has grown aggressively since 2016, with operating income growing at a triple-digit CAGR.

Source: IIPR

IIPR also shows a remarkably low level of debt for a REIT, with only a 330M bond at 5.5% to be repaid in 2026. This makes it a lot safer than most REITs in the context of inflation and rising interest rates.

The cannabis sector has been in something of a crisis since 2021 due to delays in changes in federal drug regulations, despite more than half of the US states now having legalized the drug. This also affected IIPR share prices, pushing its dividend yield to almost double digits, making it one of the highest yields in the REIT industry.

10. Farmland Partners Inc.

Farmland Partners Inc. (FPI -1.22%)

One type of real estate asset that can provide yield uncorrelated to the property and rental prices is farmland. This type of asset is much more correlated to international commodity prices.

Farmland is also the largest real estate sector in the US, as large as apartments and double industrial real estate. Despite this size, financial institutions almost do not own it at all.

Source: Farmland Partners Inc

Farmland Partners is the largest US farmland REIT, with 190,000 acres in 20 states.

The company properties’ value has been supported by several trends, most notably a rising global population combined with a steady decline in arable lands. The remarkable 0% vacancy in Farmland Partners’ portfolio illustrates the high demand for such properties.

Source: Farmland Partners Inc

10% of the company’s portfolio is in long-term investment, often hard to do for individual farmers, like planted orchards (citrus, avocados, nuts) and grapevines, which take several years of effort and investment before bringing any harvest. Nevertheless, investment and patience can pay off, with these properties making 30% of Farmland Partners’ assets by value.

Farmland income is provided by rents, but the company also benefits from agriculture land long-term appreciation, usually at or above inflation. Since 1970, farmlands have been appreciating at 5.9% CAGR.

Source: Farmland Partners Inc

Another earning potential for Farmland Partners is when some individual plots can be turned more profitable by building solar or wind farms or selling them to real estate developers. Currently, Farmland Partners has 250+ MW of solar and wind generation in development in 9 projects, with 18 more projects under option.

The main attraction of Farmland Partner to investors is its relatively low correlation to the other real estate markets. With talks of a new commodity supercycle, adding an uncorrelated asset class with a track record of steady 5-10% returns to a portfolio could be an interesting option.