Investors may find safety in healthcare REITs

Sector REITs are offering decent dividends compared to other “safe” investments

Mar.March 15, 2020 12:00 PM
Looking for a safe place to put your money to wait out the coronavirus pandemic? Healthcare stocks and real estate investment trusts in the sector aren’t a bad idea.

REITs and companies that own hospitals, medical offices, and medical science research facilities are expected to weather the pandemic and are considered safe bets even outside of health crises, according to CNN.

Kenneth Leon, an analyst with CFRA Research recommends three entities in particular: Alexandria Real Estate Equities, Healthcare Trust of America, and Medical Properties Trust.

They are each paying dividend yields of between 2.7 percent and 5 percent, making them attractive alternatives to bonds as the Federal Reserve slashes interest rates.

Companies that own senior living centers, however, probably aren’t the best bet. Leon said senior living centers will have trouble safely showing prospective new residents their facilities, pointing out that many underwent lockdowns during the flu seasons of 2018 and 2017.

The spread of Covid-19 is putting pressure on most other real estate sectors, particularly residential markets in areas with numerous cases of the virus. Home sales are down in Milan and Italy’s Lombardy region, for example. Daily deals in Seoul are down 90 percent.
Miami-Dade County has suspended all eviction activities as part of its declaration of a state of emergency.

New York landlords are stockpiling soaps and hand sanitizers and ramping up cleaning of their buildings. After an employee tested positive for the virus, Newmark Knight Frank stationed nurses at its Park Avenue office to screen clients and employees. [CNN] — Dennis Lynch

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