Industrial REITs

Industrial REITs own and manage properties used in manufacturing and production as well as distribution and even storage of goods.

Like all other REITs, industrial REITs must pay at least 90% of their net revenue back to shareholders. This allows investors an efficient, diversified mode of investing in property types otherwise inaccessible, such as factories, warehouses, distribution centers and (now surging in popularity) e-commerce fulfillment centers.

What all of these buildings have in common is a minimal need for structural customization. Industrial REITs have an advantage over other REITs in that they require comparably low startup capital to build or prepare their properties — industrial centers need floor plans, locations outside of town for delivery truck accessibility and next to no aesthetic makeover to appease tenants’ more emotional wants.

This leaves industrial REITs with minimal expenses and allows them to be highly efficient, returning greater profits back to their shareholders. There are 19 REITs of this type trading on major US stock exchanges.

Some large-cap industrial REITs include Duke Realty Corporation (NYSE: DRE), STAG Industrial, Inc (NYSE: STAG) and Monmouth Real Estate Investment Corporation (NYSE: MNR).

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