The Best REIT Stocks to Invest $1,000 in Right Now

Justin Pope, The Motley Fool

Sat, Apr 26, 2025, 5:50 PM 5 min read

Real estate is the oldest asset class in the book -- it's timeless.

But most individual investors lack the connections, knowledge, and financial resources to invest in commercial properties. That's where real estate investment trusts (REITs) come in. These publicly traded companies acquire and lease real estate. They distribute at least 90% of their taxable income to shareholders as nonqualified dividends.

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It makes REITs fantastic choices for dividend investors. Here are three world-class REITs covering three different types of real estate. Their strong financials, resilient dividend history, and attractive valuations make them the best REITs to invest $1,000 in today.

Many dividend investors know Realty Income (NYSE: O) as the "monthly dividend company" because it pays out monthly dividends rather than the quarterly schedule most companies follow. Realty Income owns and manages a portfolio of over 15,000 properties across the United States and Europe, specializing in net leases on single-tenant retail properties, including restaurants, stores, gyms, pharmacies, and other retail establishments.

High interest rates in recent years have bogged down Realty Income's stock, driving its dividend yield to about 5.5%, near decade highs. Don't worry, though; the dividend payout ratio is only 76% of Realty Income's 2024 funds from operations (FFO), and the company has paid and raised its dividend for 32 consecutive years.

The business has grown at a mid-single-digit pace over the long term. If that continues, Realty Income could be a sneakily productive long-term holding for those willing to reinvest the dividends over time. The stock trades at 14 times its FFO, a nice value for one of the market's most dependable REITs.

California has a massive economy and industrial base. If it were a country, California would have the world's 11th-largest economy. Rexford Industrial Realty (NYSE: REXR) owns and manages a portfolio of over 400 industrial properties concentrated in Southern California. Its properties house manufacturing, warehousing, distribution, and research and development for tenants across dozens of industries.

Rexford Industrial Realty's dividend yield has reached 5.3%, its highest on record. Abnormally high yields can be a red flag, but this appears more like an opportunity, as Rexford Industrial Realty's FFO comfortably covers the dividend at a 73% payout ratio. The company has managed to raise its dividend every year since its initial public offering in 2014, including during the COVID-19 pandemic.