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3 under-the-radar REITs

The investment world for most people seems to boil down to owning ASX companies or investment properties in their own name.

I think an underrated group of potential investments are real estate investment trusts (REITs). These are predominantly trusts that own commercial properties and leases them out.

You may already know ones like BWP Trust (ASX: BWP), Westfield Corp Ltd (ASX: WFD) and Scentre Group (ASX: SCG) but here are a few more to consider:

Stockland Corporation Ltd (ASX: SGP)

Stockland is one of the most diverse property businesses. It is a property developer, retirement village owner and retail landlord.

Stockland has generated large profits thanks to Australia’s economic growth and obsession with property.

Stockland is currently trading with a dividend yield of 5.84%.

Growthpoint Properties Australia Ltd (ASX: GOZ)

Growthpoint is one of the larger industrial landlords leasing industrial real estate and offices.

Some of its major tenants include Woolworths Limited (ASX: WOW), NSW Police, Commonwealth Bank of Australia (ASX: CBA) and Linfox.

Growthpoint has grown its distribution each year since June 2009 and currently has a distribution yield of 6.53%.

Goodman Group (ASX: GMG)

Goodman isn’t really a secret with its large global property portfolio.

It’s a good way to get exposure to the global economy and logistics with some of its largest tenants being Amazon, Deutsche Post, Metro AG and Japan Post.

Goodman’s underlying business has grown at a pretty good rate considering it’s only a real estate landlord.

Goodman is currently trading with a distribution yield of 3.1%.

Foolish takeaway

All three businesses wouldn’t be bad options for diversification and income. However, with interest rates predicted to continue rising it might not be the best time to buy most REITs. Of the three, Goodman would be my favourite choice because of how global its portfolio is.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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