Updated on March 31st, 2025 by Felix Martinez
CT Real Estate Investment Trust (CTRRF) has three appealing investment characteristics:
#1: It is a REIT, so it has a favorable tax structure and pays out the majority of its earnings as dividends.
Related: List of publicly traded REITs
#2: It is a high yield stock based on its 6.4% dividend yield.
Related: List of 5%+ yielding stocks
#3: It pays dividends monthly instead of quarterly.
Related: List of monthly dividend stocks
You can download our full list of 76 monthly dividend stocks (along with relevant financial metrics like dividend yields and payout ratios), which you can access below:
CT Real Estate Investment Trust’s trifecta of favorable tax status as a REIT, a high yield, and a monthly dividend make it appealing to individual investors.
But there’s more to the company than just these factors. Keep reading this article to learn more about CT Real Estate Investment Trust.
Business Overview
CT Real Estate Investment Trust (CT REIT) is a closed-end investment trust that owns commercial properties in Canada.
Its portfolio comprises over 375 properties totaling approximately 31 million square feet of gross leasable area, primarily of net lease retail properties across Canada.
CT REIT is a leading net lease REIT in Canada that significantly benefits from its relationship with Canadian Tire Corporation, its most significant tenant and controlling unitholder.
This close association and alignment are a key competitive advantage, providing important insight into real estate acquisitions and development opportunities. Such opportunities, combined with predictable rent hikes, are the primary growth drivers of CT REIT.
CT REIT exhibits strong performance metrics. Its asset portfolio currently has an exceptionally high occupancy rate of 99.4%.
Source: Investor Presentation
In addition, the REIT receives 96.3% of its annualized base rent from investment-grade tenants, and its remaining leases average 7.7 years, one of the longest periods in the REIT universe.
Canadian Tire Corporation, which is the major tenant of CT REIT, has a history of 102 years, a strong market position in Canada and ample room for future growth.
Source: Investor Presentation
It also has annual revenues of $402 million and a BBB credit rating. The merits of having a major tenant with strong business performance and a solid financial position are obvious.
Growth Prospects
CT REIT is ideally positioned to leverage its relationship with Canadian Tire Corporation and pursue third-party net lease opportunities to complement organic growth. It also benefits from average annual rent hikes of about 1.5%.
Since its IPO, CT REIT has acquired and leased more than 2 million square feet of industrial properties to Canadian Tire Corporation. In addition, other properties of Canadian Tire Corporation are likely to meet CT REIT’s investment criteria.
The company reported strong results for Q4 and FY 2024. Q4 property revenue increased 3.9% to $145.4 million, with net operating income (NOI) up 3.6% to $115.6 million. Net income for the quarter surged 253% to $135.3 million, driven by higher revenues and fair value adjustments. Full-year net income grew 89.3% to $434.2 million. Funds from operations (FFO) rose 1.7% to $79.0 million, and adjusted funds from operations (AFFO) increased 2.1% to $73.0 million. Distributions per unit increased 3.0% to $0.231.
In 2024, CT REIT invested $176 million in projects, adding 400,000 square feet of gross leasable area (GLA). The REIT completed $103 million in projects, contributing 322,000 square feet to the portfolio. The company also initiated three new investments totaling $59 million, which will add 284,000 square feet of GLA. As of December 31, 2024, 881,000 square feet were under development, 88.4% of which is pre-leased.
The REIT maintained a high occupancy rate of 99.4% and an indebtedness ratio of 41.1%. CT REIT continues to capitalize on its development pipeline and strong balance sheet to generate consistent returns for unitholders.
Dividend & Valuation Analysis
In contrast to many REITs, which cut their dividends in 2020-2021 due to the coronavirus crisis, CT REIT proved resilient to that downturn thanks to its robust business model. The REIT grew its FFO per share by 4% in 2020 and by 7% in 2021, and thus it raised its dividend (in USD) by 5% in 2020 and by another 5% in 2021.
Moreover, CT REIT is currently offering a 6.4% dividend yield. Thanks to its defensive business model, reasonable (for a REIT) payout ratio of 75%, and interest coverage of 3.6, the trust is not likely to cut its dividend in the absence of a severe recession.
In reference to the valuation, CT REIT has traded for 11.7 times its adjusted FFO per share in the last 12 months. Given the trust’s modest growth rate, we assume a fair price-to-FFO ratio of 12.0 for the stock.
Therefore, the current FFO multiple is slightly lower than our assumed fair price-to-FFO ratio. If the stock trades at its fair valuation level in five years, it will incur a 0.6% annualized return.
Considering the 3% annual FFO-per-share growth, the 6.4% dividend, and a 0.6% annualized expansion of valuation level, CT REIT could offer a 10% average annual total return over the next five years.
This is a decent expected return, but investors should probably wait for a more opportune entry point in order to enhance their future return and increase their margin of safety.
Final Thoughts
CT REIT has exhibited consistent and reliable business performance over the last decade. It also proved markedly resilient throughout the coronavirus crisis, defending its dividend in sharp contrast to many other REITs.
The stock also offers a 6.2% dividend yield and a decent payout ratio of 75%, making it an attractive candidate for income investors’ portfolios.
On the other hand, investors should be aware that CT REIT is a slow-growth REIT, and hence, it is prudent to try to have a wide margin of safety regarding the stock’s valuation.
CT REIT appears almost fairly valued right now. Therefore, investors should wait for a meaningful correction lower than $10 before purchasing the stock.
Additional Reading
Don’t miss the resources below for more monthly dividend stock investing research:
- The Monthly Dividend Stocks List
- 20 Highest Yielding Monthly Dividend Stocks
- 10 Cheapest Monthly Dividend Stocks
- 10 Safest Monthly Dividend Stocks
- 3 Top ‘Hold Forever’ Monthly Dividend Stocks
And see the resources below for more compelling investment ideas for dividend growth stocks and/or high-yield investment securities.
- Dividend Kings: 50+ years of rising dividends
- Dividend Champions: 25+ years of rising dividends
- Dividend Aristocrats: 25+ years of rising dividends and in the S&P 500
- Dividend Achievers: 10+ years of rising dividends and in the NASDAQ
- High Dividend Stocks: 5%+ dividend yields
- Blue Chip Stock: Kings, Aristocrats, and Achievers
- MLPs: List of MLPs and more
- REITs: List of REITs and more
- BDCs: List of BDCs and more