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The economic outlook remains grim, with the growing likelihood of a recession because of the still-elevated inflation and the recent banking crisis. Hence, quality REITs Gaming and Leisure Properties, Inc. (GLPI), Ladder Capital Corp (LADR), and Whitestone REIT (WSR) could be ideal investments since they offer high-yield dividends that could cushion your portfolio against any potential repercussions of an unpredictable economy.
The consumer price index (CPI) rose 0.4% in February, resulting in an annual inflation rate of 6%. Although inflation fell for the eighth consecutive month, it remains significantly higher than the Fed’s target of 2%. Continued interest rate hikes to tame stubborn inflation and recent banking woes are raising the odds of a recession this year.
This year’s persistent theme of uncertainty is likely to have no significant implication for Real Estate Investment Trusts (REITs) because of their strong operational performance and balance sheets. REITs tend to perform better during periods of high inflation as they benefit primarily from increasing prices of their properties.
Moreover, REITs display financial robustness with historically low leverage and well-structured fixed-rate debt resulting in minimal current interest expenses. Most importantly, they distribute at least 90% of taxable income to shareholders in the form of dividends, resulting in a…
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