These two real estate investment trusts — both associated with the Gladstone name — offer monthly dividends that provide investors a steady source of income, explains Ned Piplovic, editor of DividendInvestor.
Gladstone Land Corporation (LAND)
Dividend Yield: 4.5%
The Gladstone Land Corporation invests in farmland and farm-related properties that are located in major agricultural markets in the United States. The REIT then leases this land to unrelated third-party farmer-tenants.
This REIT has enhanced its annual dividend payout for the past five consecutive years. Over those five years, the annual dividend amount rose nearly 50%, which corresponds to an average growth rate of 8.1% per year.
LAND’s share price declined during the three years after its establishment in 2013. However, the share price has since reversed its trend and has advanced more than 70% since the beginning of 2016.
Over the past twelve months, the share price has pulled back. This has offset some of the dividend income and reduced the 4.5% dividend yield to a total return of 2%.
However, the total gains over the past five years have exceeded 28%. Concurrently, a significant share price decline in late 2015 has pushed the three-year total return to more than 35%.
Gladstone Commercial Corporation (GOOD)
Dividend Yield: 6.34%
The Gladstone Commercial Corporation pays monthly cash distributions to its stockholders and invests in net leased industrial, commercial and retail real property. It also selectively makes long-term industrial and commercial mortgage loans.
The company’s current $0.125 monthly dividend amount corresponds to a $1.50 annualized payout and currently yields 6.52%.
While robust asset appreciation has suppressed the current yield below the company’s own 7.8% yield average over the last five years, Gladstone Commercial Corporation current yield is more than twice the 3.04% average yield of the entire financial sector.
Additionally, GOOD’s current yield has also outperformed the 6.29% simple average yield of the Closed-End Fund — Equity industrial segment.
Furthermore, the Gladstone Commercial Corporation’s asset appreciation has combined with the dividend income to produce total return of nearly 35%.
Additionally, this REIT has also delivered to its shareholders a 68% total return over the past three years and a more than 72% return over the last five years.
