Published Fri, 12 Apr 2019 09:15:00 -0400 on Seeking Alpha
Does your portfolio have real estate exposure? With the Fed raising rates in 2018, the real estate sector fell -6.59%. But now in 2019, after the Fed has become more dovish, interest-rate sectors have performed much better year to date, with the real estate sector among the leaders, rising by 17.74%:
While real estate still trails the tech, consumer discretionary, and industrial sectors year to date, the good news for income investors is that the real estate sector offers much better yields.
With that in mind, we went looking for real estate income vehicles and came up with three closed-end funds, all of which yield 7% or more, but are still trading at discounts to NAV.
The Principal Real Estate Income Fund (PGZ) is by far the smallest of this trio, with ~$205M in assets, vs. $1.43B for Cohen & Steers Quality Income Realty Fund (NYSE: RQI) and $1.97B for Cohen & Steers REIT and Preferred Income Fund (RNP).
The other major difference with PGZ is that its primary concentration is in mortgage-backed debt, 64%, while RQI holds ~79% in real estate common equities, and RNP holds 50%.
PGZ's top 10 holdings include debt from JPMorgan (JPM), Goldman Sachs (GS), and Wells Fargo (WFC):
PGZ also holds 18.6% in non-US real estate securities and 16.6% in US real estate securities, giving it a bit more geographical diversification:
(Source: PGZ site)
RQI and RNP have similar top 10 holdings, with several equities... Read more
|Stock name||Last trade||P/E||Earnings/Share||Dividend/Share||Dividend yield|
|COHEN & STEERS QUALITY INCOME REALTY FUND||13.60||0.0||0.00||0.00||6.94|
|COHEN & STEERS REIT||21.93||0.0||0.00||0.00||6.72|
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