Rate Ruckus Has Routed REITs. These 4 Now Pay Up to 14.6%

Brett Owens, Chief Investment Strategist
Updated: March 27, 2026

Oil is up, and everything else is down. Stocks. Bonds. Even gold, the traditional safe haven!

Real estate stocks are on sale as well. Which means we contrarians need to go shopping. Today we’ll look at four real estate investment trusts (REITs) yielding between 6% and 15%.

Right before the conflict started, I mentioned that we were looking at an attractive setup for price appreciation in REITworld.

As the Fed cuts rates, the dividends that REITs pay become increasingly attractive to income investors. Money markets don’t pay 5% any longer. Neither do many bond funds. But REITs pay … 

And rates are likely to continue lower due to the rollout of AI across the economy. Automation is capping wage growth. Customer support, for example, is well on its way to being automated. Next up we’ll see bookkeeping, compliance and even legal work increasingly handled by machines. Softer inflation gives the Fed room to cut more than Wall Street expects.

The longer-term outlook has not changed. (A big hint for anyone with a mature, big picture mindset!) But in the short term, the Federal Reserve has pushed “pause” on its rate-cutting trend.

Earlier this year, we could chalk it up to economic data. Now? The central bank is clearly in wait-and-see mode because of the Middle East.

“The thing I really want to emphasize is that nobody knows,” Fed Chair Jerome Powell recently said. “The economic effect [of the Iran war and oil disruptions] could be bigger, they could be smaller, they could be much smaller or much bigger. We just don’t know.”

As a result, the market has all but given up on any additional near-term relief in interest rates. FedWatch, which uses 30-day Federal funds futures prices to determine the probability of changes to the Fed’s target rate, shows an 88% likelihood that the Fed will stay put at its late-April meeting.

And, In Fact, There’s a 12% Probability That Rates Go Up

Source: CME FedWatch

That’s misery for REITs, which thrive when borrowing costs fall and their dividends look good in comparison to shrinking bond yields—but struggle when rising rates produce the opposite effect.

Virtually All of Real Estate’s 2026 Gains Have Been Erased

Again: The longer-term drivers of lower interest rates are still intact for now, which means this could be an ideal time to look for REIT deals. On my radar for a closer examination are these four landlords, which currently dole out between 6.1% and 14.6%.

Sabra Health Care REIT (SBRA)
Dividend Yield: 6.1%

Sabra Health Care REIT is a senior-focused healthcare play with roughly 360 property investments across the U.S. and Canada.

A little less than half of the portfolio, as measured by annualized cash net operating income (NOI), comes from skilled nursing and transitional care real estate. Another quarter or so is managed senior housing, with the remainder split among behavioral health properties, leased senior housing and specialty hospitals, among others.

The COVID crisis delivered a major shock to this type of real estate, but the long-term trends have remained in its favor—and that continues today. Supply is low. Pricing power is high. And Sabra is looking at expanding its senior housing operating portfolio (SHOP) via acquisitions.

As a result, shares have simultaneously been less volatile than the market but also plenty productive. In fact, the stock has steadily been making its way toward pre-COVID highs.

Returns Look Even Better When We Include the Dividend, But …

Sabra’s distribution hasn’t budged since slashing it by a third during the depths of the COVID doldrums.

It’s not for lack of room. SBRA pays 30 cents per share quarterly, so $1.20 across the year. Estimates for this year’s adjusted funds from operations (AFFO) are $1.60 per share. That’s a 75% AFFO payout ratio, which leaves room for at least some growth. But even though many other REITs have returned to dividend growth post-COVID, it’s not exactly surprising that Sabra has been hesitant.

The latest dip gives us a decent yield of around 6%, and SBRA trades at a decent 12 times AFFO estimates. It’s OK, but it’s hardly bargain territory yet.

Millrose Properties (MRP)
Dividend Yield: 10.4%

I highlighted several new dividend payers last July, including Millrose Properties (MRP), one of the more unusual REITs to ever hit the market.

Millrose was spun off by homebuilder Lennar (LEN) in 2025. The company exists to buy and develop residential land, then sell finished homesites back to Lennar and other homebuilders through option contracts with predetermined costs. Lennar, for instance, will pay Millrose an 8.5% annual option fee.

It’s truly a unique structure, so I wanted to revisit it after we had more data to look at.

So far, no complaint on the bottom line—Millrose delivered higher AFFO across every quarter of 2025, and estimates are for MRP to maintain or modestly grow AFFO every quarter across the next couple of years. And the REIT has been happy to push almost all of that back to investors, raising the distribution every quarter of its existence so far.

Though I Doubt a 99% AFFO Payout Ratio Is Doable Forever

Rate uncertainty has clearly been weighing on shares of late. But what’s more interesting to me is that the administration’s executive orders to spark increased homebuilding haven’t done more to liven up shares.

I’ll also point out that MRP, at a 26% debt-to-capitalization ratio, is still plenty below its 33% max leverage target. Getting closer could spur more growth.

Meanwhile, shares trade at roughly 9 times AFFO estimates for this year. That’s definitely nice in a bubble, though MRP doesn’t have nearly enough trading history for us to know whether that valuation will be more norm or exception.

Innovative Industrial Properties (IIPR)
Dividend Yield: 14.4%

Innovative Industrial Properties (IIPR) acts as the first landlord and primary lender of choice for cannabis operators. In fact, this REIT is a capital lifeline for the industry.

IIPR buys dispensary facilities from the operators who are often short on cash and can’t finance their buildings because of the many roadblocks set up between cannabis businesses and banks. In the transaction, IIPR hands them a chunk of cash they badly need. Then it leases the facility back to the operator for 15 to 20 years.

Because traditional banks won’t touch the space, Innovative Industrial Properties negotiates incredibly favorable leases. They have long durations, built-in rent escalators and guarantees from the large corporate multi-state operator-lessees.

IIPR is essentially a “Godfather landlord” in a restricted industry. Cannabis peddlers need cash and have nobody else to turn to. So, they take the deal.

The REIT industry might have taken a hit in 2026, but we wouldn’t know it by looking at IIPR, which is one of the best-behaving stocks in the space this year.

IIPR Gained Ground After Earnings, Gave Very Little Back

It’s a promising sign of relative strength from a stock that lost its luster years ago. IIPR’s price has cratered by 80% over the past five years—a bubble that simply popped.

Still, the slow but persistent march of cannabis legalization remains a long-term tailwind. IIPR is paying investors a high 14% dividend, though coverage has tightened up of late (2025 dividends of $7.60 actually outstripped AFFO of $7.24 per share). And we’re not paying much—after commanding crazy valuations of 30 to 40 times AFFO years ago, IIPR trades at less than 8 times AFFO estimates.

MFA Financial (MFA)
Dividend Yield: 14.6%

We can’t talk about high-yield REITs without discussing mortgage REITs (mREITs) like MFA Financial (MFA), which are the crème de la crème when it comes to eye-popping real estate payouts.

A reminder: Mortgage REITs borrow money at short-term rates to purchase mortgages (and other assets) that pay income tied to long-term rates, then profit off the difference. Their hope, then, is that short-term rates will be lower than long-term rates (which they usually are), and that short-term rates decline while long-term rates hold steady or move lower. The mREITs’ existing mortgages, which were issued when rates were higher, will yield more than newly issued ones, and thus be worth more.

Understandably, worries that the Fed might put off (or simply avoid altogether) any rate cuts in 2026, based on how the war with Iran resolves, has spooked mREITs right alongside traditional equity REITs.

MFA Is Holding Up Stronger Than Most, However

The company delivered an encouraging fourth-quarter report that provided some much-needed relief in a critical area: “distributable earnings per share” (DE), a non-GAAP measure of profitability that MFA favors.

I wrote in September that MFA was staring down the barrel of a significant dividend coverage problem—a potentially painful situation, but one that was expected to improve in 2026. And in fact, MFA finished 2025 with just $1.00 in DE versus $1.44 in dividends paid.

But its fourth quarter was much better than expected. Distributable EPS was better than expected. Economic book value per share inched higher in Q4, but management said it was up 3% so far in the current quarter. The investment portfolio improved by nearly 10%.

There’s still risk—MFA still needs to execute to get out of the woods, and a stalled Fed could hamper that—but this mREIT likely is still in a better position than it was half a year ago.

A Fully Paid Retirement for Just $600,000?

A 15% yield would do wonders for any retirement portfolio.

However, if we own 15% yielders that force us to religiously watch every earnings report for fear of a dividend cut, we might not make it to retirement.

If we’re going to retire on dividends alone, we don’t just need high yields—we need no-doubt payers that aren’t an earnings disappointment away from ruining our income stream.

And those are the kinds of dividends I prioritize in my “9% Monthly Payer Portfolio.”

These generous stocks and funds pay up to 14.9% and average more than 9% across the board. That’s enough to live on dividends alone—without ever needing to sell a single share to generate cash.

The math on this portfolio is easy to follow:

• A $600,000 nest egg could earn $54,000—in many places in the U.S., that’s enough for a fully paid retirement without even factoring in Social Security!
• And if you have managed to stow away a cool million bucks to work with, the 9% Monthly Payer Portfolio would pay you a downright lush $90,000 in dividend income every year.

Better still? You’d be cashing dividend checks not annually, not quarterly, but each and every month. That means no “lumpy” payouts. No complex dividend calendars. No dumping money into certain stocks because you’re getting underpaid every third month.

Just paydays as smooth as when you were collecting a paycheck!

Nothing in Contrarian Outlook is intended to be investment advice, nor does it represent the opinion of, counsel from, or recommendations by BNK Invest Inc. or any of its affiliates, subsidiaries or partners. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person.

We take a look at the first presentations of our ISA season event.

Kepler Trust Intelligence

Disclaimer

This is not substantive investment research or a research recommendation, as it does not constitute substantive research or analysis. This material should be considered as general market commentary.

Day 1 – Greencoat UK Wind | Alan Ray

The Greencoat UK Wind (UKW) team discuss the trust’s recent results, and, more broadly, the importance of onshore and offshore wind to the overall energy mix for the UK. They spend some time considering some of the opportunities to upgrade and re-power the current portfolio and look at the landscape for further development of the sector, noting the success of the UK government’s most recent auction for new projects. They also touch upon their capital allocation policy, designed as a response to the wide discount, and the need for consolidation in their peer group.

Click here to watch the UKW recording

Day 2 – Bankers | Josef Licsauer

In the session, Richard Clode discusses how the Bankers Investment Trust (BNKR) seeks to balance global equity exposure, avoiding strong growth or value tilts and instead focussing on bottom-up stock selection. Whilst geopolitical developments remain an important backdrop, diversification across regions and sectors is central to managing risk and identifying companies capable of delivering sustainable growth. Artificial intelligence is a key theme, with Richard highlighting how the technology is evolving through several stages, producing new market leaders and disrupting incumbents, though emphasising that attractive investments can still be found in companies with strong fundamentals and reasonable valuations.

Click here to watch the BNKR recording

Day 3 – JPMorgan European Growth & Income | Alan Ray

JPMorgan European Growth & Income’s (JEGI) manager Timothy Lewis discusses the team’s investment process, and how they harness the resources available to them at JPMorgan. He also looks at some of the companies and sectors that have driven JEGI’s very strong performance, at some of the ‘off benchmark’ small companies in the portfolio and considers some of the bigger picture factors, such as valuations, fiscal stimulus and energy prices, that are shaping investors’ approach to investing in Europe.

Click here to watch the JEGI recording

Day 4 – City of London | Josef Licsauer

In this webinar, manager Job Curtis discussed how City of London Investment Trust (CTY) combines a long-term record of dividend growth with strong total returns, underpinned by a valuation-driven, income-focussed investment approach. He highlighted the trust’s diversified exposure across sectors and geographies, emphasising cash-generative companies with strong balance sheets that support dividends and capital expenditure. Job also considered the impact of macroeconomic factors, including UK interest rates, Middle East tensions affecting oil and energy, and global growth dynamics. Overall, Job reinforced CTY’s focus on downside protection, selective stock opportunities and consistent income delivery in a challenging market environment.

Click here to watch the CTY recording

Day 5 – Rights & Issues | Ryan Lightfoot-Aminoff

As a new presenter to our audience, Rights & Issues’ (RIII) manager Matt Cable began the presentation with some background on the trust. This included a brief history lesson of the 63-year-old vehicle, which focusses on UK smaller companies, and the journey to being under the leadership of Matt and the Jupiter firm. He went on to describe his process, which contains four elements including a top-down overlay to help mitigate risks, although stock selection is predominantly bottom-up. Matt discussed the ongoing impact of M&A which has continued to be a factor in the UK smaller companies market, and has been a notable supporting factor to performance in the past year. However, the market’s disregard for quality has been a headwind, with Matt discussing a number of examples both in the presentation and again in the Q&A session.

Click here to watch the RIII recording

 Henderson Far East to replace Just Group on FTSE 250 effective Apr 1

City of London Investment Trust (CTY)17 March 2026

Disclaimer

Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by City of London Investment Trust (CTY). The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

Overview Overview Analyst’s

CTY’s 60th year of dividend increases, a first for the trust sector.

Overview

City of London Investment Trust (CTY) is approaching a landmark this year: the potential delivery of its 60th consecutive year of Dividend growth, a record unmatched in the investment trust sector. This consistency has been a hallmark of the strategy under Job Curtis, who has managed the trust since 1991, alongside deputy manager David Smith, appointed in 2021.

The trust’s durability stems from a conservative, balanced approach to portfolio construction, combining higher-yielding stocks with companies capable of stronger long-term capital and dividend growth. Ensuring a diversified income pool has helped smooth earnings over time, whilst the investment trust structure provides an extra buffer through revenue reserves, tapped during lean periods such as the COVID-induced disruptions in 2020.

This disciplined approach has supported long-term returns and recent Performance, despite market volatility. Over the 12 months to 12/03/2026, CTY delivered NAV and share price total returns of 25.9% and 28.3%, respectively, outpacing the FTSE All-Share Index. Returns were bolstered by several high-conviction holdings, including NatWest Group and Phoenix Group Holdings, alongside strategic underweights elsewhere.

The managers have also increased the Portfolio’s exposure to selected UK REITs, where signs of stabilising demand and improving rental growth are emerging, including via a new position in Big Yellow Group. The property sector has faced headwinds from higher interest rates, but CTY has leveraged market weakness to acquire high-quality assets trading at substantial discounts to underlying values.

Having traded at a Discount in early April 2025, CTY sharply returned to more familiar premium territory and currently trades at a small premium of around 0.6%, in line with its five-year average.

Analyst’s View

Few UK equity income strategies can match the long-term consistency of CTY, in our view. Under Job’s stewardship, the trust has quietly compounded income and capital for more than three decades, comfortably ahead of the broader UK market. This year’s potential 60th consecutive dividend increase would further cement CTY’s status as the pre-eminent AIC Dividend Hero, a testament to the resilience of its underlying portfolio, prudent use of revenue reserves, and the managers’ long-term disciplined approach.

We also like the trust’s commitment to a traditional dividend model. Payments are expected to come from revenue, rather than realised capital gains, a discipline that matters in weaker markets, where investors may be seldom keen to receive income funded by their own capital. This focus on earnings-driven dividends should, therefore, provide a more dependable foundation for long-term income growth. The current yield, modestly above the FTSE All-Share Index, is attractive but remains sensitive to interest-rate shifts; a rise in rates could again temper demand for higher-yield investment trusts, as investors return to favouring lower-risk cash and gilt options, as we saw in 2022 and 2023.

Looking more broadly, however, we think the UK market remains compelling. Despite strong recent returns, it is still under-owned globally, and valuations are reasonable relative to many international peers. Persistent inbound M&A activity suggests overseas buyers recognise the value of UK assets, reinforcing the opportunity set. In this context, CTY offers a pragmatic route to access the UK market’s potential through a diversified portfolio of established, cash-generative businesses, at the lowest ongoing Charge in the AIC UK Equity Income sector.

Bull

• Lowest OCF in the AIC UK Equity Income sector
• Consistency and experience of manager who has delivered long-term outperformance of the FTSE All-Share Index in capital and income terms
• A near six-decade-long track record of growing the dividend

Bear

• Cautious approach means that NAV can underperform in some market conditions
• Income track record highly attractive, so manager might risk long-term capital growth in trying to maintain it
• Structural gearing can exacerbate the downside

---

Dividends re-invested £1.52 > £19.77

From his book How to Make Money in Stocks, he lists twenty one costly mistakes, which I will post over the next few weeks.

Temple Bar Investment Trust Plc – Annual Financial Report for the year ended 31 December 2025

20th March 2026

Temple Bar Investment Trust Plc

Annual Financial Report for the year ended 31 December 2025

London, 20 March 2026 – Temple Bar Investment Trust Plc (LSE:TMPL), the UK-listed investment company that focuses on intrinsic value and long-term growth by investing primarily in UK-listed securities, has today announced annual results for the year ended 31 December 2025.

Highlights:

• Net Asset Value (“NAV”) total return with debt at fair value of +33.9% (2024: +19.9%) once again exceeding the Benchmark, the FTSE All-Share Index, which delivered +24.0% (2024: +9.5%)
• Share price total return of +45.3%, (2024: +19.1%)
• Dividend of 15 pence per ordinary share – an increase of 33.3% (2024: 11.25 pence), representing a yield of 4%
• The Company’s market capitalisation is £1.1bn at the time of writing, up from £776m at the start of 2025

Charles Cade, Chairman of Temple Bar Investment Trust comments:

“2025 was another strong year for the Company’s performance, both in absolute terms and relative to the FTSE All-Share Index, the Company’s benchmark. The Net Asset Value total return with debt at fair value was +33.9% and the share price total return was +45.3%, compared with a total return of +24.0% for the Benchmark.

“Returns were primarily driven by stock selection rather than broader market movements, reflecting the Portfolio Manager’s focus on company fundamentals, valuation discipline and active engagement with investee companies.

“The Board continues to monitor the Company’s net revenue position closely and, based on the latest forecasts, expects to maintain a progressive dividend policy with future annual dividends increasing over time. It is the Board’s current intention to increase the quarterly dividends to 3.90p per share in 2026 (2025: 3.75p per share), an increase of 4.0% on 2025, representing an annualised dividend yield of 4.3%, based on the share price at the time of writing.  

I am pleased to report that 2025 was another strong year for the Company’s performance, both in absolute terms and relative to the FTSE All-Share Index, the Company’s benchmark. The Net Asset Value total return with debt at fair value was +33.9% and the share price total return was +45.3%, compared with a total return of +24.0% for the Benchmark.

Since Redwheel took over the management of the Company’s portfolio at the end of October 2020, the Net Asset Value total return to the end of 2025 has been +199.8% compared with +103.7% for the Benchmark, representing outperformance of 8.9% per annum.

Dividend and Dividend Policy

Total dividends for the year amounted to 15.00p per share (2024: 11.25p per share), an increase of 33.3% and representing a yield of 4.0% at the year end.

The Board continues to monitor the Company’s net revenue position closely and, based on the latest forecasts, expects to maintain a progressive dividend policy with future annual dividends increasing over time. However, the pace of this growth is unlikely to match the significant increases seen in the past few years which have been partly due to a strong recovery in underlying dividends post-COVID, but also reflect a change in the Company’s distribution policy.

Last year, the Board recognised that many listed companies have been altering the nature of their distributions to shareholders, with substantial growth in the level of share buybacks either alongside or instead of dividends. According to Computershare’s UK Dividend Monitor, share buybacks represented 42.1% of the total distributions by UK listed companies in 2025. Unlike dividends, share buybacks by portfolio companies are not recognised as revenue in your Company’s accounts. Reflecting this, shareholder authority was obtained at the last AGM to amend the Company’s dividend policy to enhance the dividend it pays from its net revenue by using our capital reserve

Outlook

It would be easy for investors to take fright given the uncertain macro-economic and geopolitical outlook. In the UK, economic growth remains anaemic, with a rising tax burden on businesses and renewed inflationary fears following the recent surge in energy prices. It is worth recognising, though, that the Company’s performance is not closely correlated to the health of the UK economy. Indeed, the Portfolio Manager estimates that only approximately 35% of the underlying revenue of portfolio companies comes from the UK. In part, this reflects the global nature of many UK listed companies, particularly in the Oil and Mining sectors, but it is also a result of the Company’s exposure of up to 30% in businesses listed overseas.

Dividends per Share

It remains the Directors’ intention to distribute, over time, by way of four quarterly dividends, substantially all of the Company’s net revenue income after expenses and taxation. Further, an additional 3.0p per share per annum (0.75p per share per quarter) is currently paid using the Company’s capital reserves.

The Portfolio Manager aims to maximise total returns from the portfolio. The Company has paid dividends totalling 15.0p   per ordinary share for the year ended 31 December 2025 (2024: 11.25p), representing a dividend yield of 4.0% at the year-end (2024: 4.1%). The Board hopes to continue sustainable dividend growth over the coming years supported by the use of the Company’s capital reserves. Further information can be found in the Chair’s Statement.

TMPL

Quote

“There are two emotions in the market fear and greed, the problem is we hope when we should fear and fear when we should hope.”

Or

We hope with a losing position that Mr. Market will make good our mistakes.

We fear that Mr. Market will take away part or all of our profit.

If you bought from the chart, you missed the first part of the reversal but you could have traded most of the rally. After such strong price action, you wouldn’t have needed much persuasion to take all or part profits.

You may have to wait quite a long time to see such a strong chart.

You can only get in at the bottom of a rally and out at the top by luck, so don’t waste too much mental energy beating yourself up when you don’t.

With a cloud chart, generally if the price is above the cloud the sun is shining on your trade.

In the cloud watch to see which way it breaks.

Below the cloud, it’s raining on your parade.

Mr. Market to stay in business ensures nothing works all the time.

The plan for the SNOWBALL for the new financial year starting soon is £10,500 and the fcast is £10,500

The income for the SNOWBALL for this financial year will be £13,738, the amount includes some special dividends so it’s unlikely to be equalled this year.

The SNOWBALL has a comparator share VWRP where the 4% rule is applied. Current value £146,469, despite losing £11,318 from its recent high, still not too shabby.

Applying the 4% rule, after allowing for a 3 year cash buffer income of £5,200

Looking at the table above: the value of VWRP to match the income in the table would need to be £450,000 plus a cash buffer. GL with that.

Whilst all weeks are good weeks for a dividend re-investment plan, some weeks are better than others.

PEYS Partner Group leaves the watchlist.

NESF current yield 18% but will fall after the next dividend is paid to around 9%.

Mr. Market is providing some great yields for dividend re-investment, GL with you choices.

The SNOWBALL will have 11k to re-invest next week.

The four Trusts that I am interested in are

CTY,MRCH,TMPL,SUPR

Unless there is a surprise takeover announcement and that’s a slim chance and

I will only be willing to buy an opening position in two of the Trusts, sometimes the hardest part of investing is doing nothing.

If MRCH trades down to its recent low the yield will be a tad over 5%, which would be of interest for a pair trade to balance out one of the higher yielder renewables.

Will it go lower and therefore a better yield ? A little while before its xd date so there is no real hurry to buy apart from FOMO on the yield, remember it will be a buy and hold forever.

The large majority of non-Saba shareholders have shown by their votes in previous general meetings of the Company that they have no wish to be in a Saba controlled vehicle, and the Board understands from discussion with shareholders to date that many would like to remain invested in the Company’s current mandate, or, if not, in another suitable investment company. In particular, given the very strong long-term performance of Herald, which has delivered a 2,904% NAV total return since inception, many shareholders have significant capital gains on their holdings. The Board is conscious that should the Company be forced to proceed with the Backstop Tender Offer, in the absence of an alternative, such shareholders will be faced with a choice of realising these gains in the Backstop Tender Offer, which would crystallise an unwanted tax event, or keeping their investment in what will likely become a Saba managed and controlled vehicle.

Herald haven’t paid a dividend for many a year. To hold the share long term was an act of faith, which ultimately made a large return. Whilst always easier in hindsight, buy the dips.