Federal Realty Investment Trust: A dividend king

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The Federal Realty Investment Trust is considered one of the REIT dividend-kings in the market.

With a tradition of more than 50 years, FRT has an A-rated credit. It is also known as a dividend king and hasn’t cut its payout for more half a century. Even during troubling times like the Covid pandemic, a lot of investors had no qualms in putting their money in FRT. Even when the returns are negative for other investments, FRT has impressed the market with its steadiness.

According to data, the company, which has one of the best portfolios, has paid off around 75% RoR in fewer than 1.5 years.

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FRT is good for investors who are interested in long-term investments. One of the advantages it had is that FRT manages properties in first-ring suburbs located in 9 major metropolitan markets.

Its balance sheet and credit ratings remain at the top of the sector. Besides, the management is a very seasoned and experienced team.

It has established new properties in San Jose, Bethesda, and Somerville and has focused on diversification strategy.

The company’s income is coming from wildly diversified tenant segments and individual tenants.

The company focuses on mixed-use developments and redeveloping its existing properties. It’s current plans include three major mixed-use projects on the east and west coast. It has plans to invest $175 million in redevelopment over the next three years in the country.

The company in its full-year guidance is optimistic of more than 7 per cent growth. The company posted very good results when considering an FFO of $1.51 per share. It managed 119 retail leases at a 7% cash basis rent than the rents they replaced. The main driver behind these excellent results was a resurgence in demand and shopping that surprised even FRT, especially with delta coming on. The company collected even more rent in 3Q21 than anticipated, and has improved its collections to 96%, with far fewer than expected tenant failures.

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