Normally, investors looking for dividend growth wouldn’t expect to find it in the real estate investment trust (REIT) sector. But sometimes there are gems that get overlooked because they don’t conform to the norms. Rexford Industrial Realty (NYSE: REXR) is just such a genre-defying stock. Here are three reasons why this is one magnificent high-yield dividend growth stock you’ll want to consider buying and holding forever.
1. Rexford’s yield is attractive
To get the bad news out first, Rexford Industrial’s yield is a little below average for a REIT. Rexford’s dividend yield is 3.3% while the average REIT has a yield of roughly 3.7%. However, when you compare Rexford to the broader market, it looks a lot better. That 3.3% yield is nearly three times larger than the S&P 500 index’s paltry 1.2% yield.
REXR Chart
And, thanks to a dramatic pullback in Rexford’s stock price, the dividend yield is also near its highest levels of the decade. So you can find higher-yielding REITs, but Rexford’s yield still looks fairly attractive on both an absolute basis and relative to its own history.
2. Rexford’s dividend growth is hugely attractive
You can’t just look at Rexford Industrial’s yield and call it a day. The REIT’s most impressive dividend statistic is the rate of dividend growth it has achieved over the past decade. REITs are generally known as slow and steady growers; a mid-single-digit dividend growth rate is usually considered quite good. Rexford’s dividend expanded at an annualized rate of 13% over the past decade. That would be a huge number for any company but is downright phenomenal for a REIT.
REXR Dividend Per Share (Quarterly) Chart
When you add the dividend growth to the yield, it becomes clear that Rexford is a very attractive growth and income stock. In fact, over roughly the past 10 years the dividend has grown from $0.12 per share per quarter (in 2013) to $0.4175 per share (in 2024). That’s a nearly 250% leap, something that just about any dividend investor would appreciate.
3. Rexford’s business model is differentiated
Rexford is an industrial REIT, which isn’t…
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