The ASX dividend stock Centuria Industrial REIT (ASX: CIP) is one of the leading opportunities for passive income on the ASX right now, in my view. It's down close to 20% from its 52-week high, as the chart below shows.
It makes sense why a real estate investment trust (REIT) would fall at a time like this. Higher oil prices are expected to lead to higher inflation and require higher interest rates.
Higher interest rates could mean higher costing debt and a headwind for property prices.
But, I expect that interest rates to lower again in the future (as occurred in 2022). The timing is less clear – we'll just have to see how long it takes for inflation to return to the Reserve Bank of Australia (RBA) target range.
At this lower price, I think the ASX dividend stock is a great long-term buy for a few reasons.
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Stronger dividend yield
I get excited when share prices go down because it usually means a better dividend yield for investors.
For example, if a business has a distribution yield of 5% and the share price falls 10%, the yield becomes 5.5%.
As I mentioned earlier, the Centuria Industrial REIT unit price has declined by around 20% since its 52-week high towards the end of last year.
It's expecting to grow its FY26 annual distribution by 3% to 16.8 cents per unit. At the time of writing, that translates into a distribution yield of 5.75%. It's possible that the yield could go even higher in the coming days or weeks, but I think this is a great yield to take advantage of today.
Cheaper valuation
I like getting a better yield, but I also like buying at a cheaper price because it means buying the underlying properties at a cheaper valuation. These conditions likely to deliver better to capital growth over time.
It's hard to know exactly how much the property portfolio is worth without the business selling all of its real estate, which it obviously isn't going to do.
But, the business provides a net tangible asset (NTA) figure every six months. This gives investors a reading on its underlying overall value.
At 31 December 2025, the ASX dividend stock reported that it had a NTA of $3.95. At the time of writing, it's trading at 26% discount to the figure.
Excellent rental demand tailwinds
One of the main reasons to like this business (particularly at the lower valuation) is the attractive rental growth that it's generating, which can justify an increase in real estate prices over time.
Industrial land is increasingly in demand because of a number of tailwinds including a growing population, increased e-commerce adoption, fresh food and pharmaceutical demand (with refrigerated facilities), increasing data centre demand, onshoring of supply chains and a limited supply of new industrial facilities.
It's the strong growth of rent in recent years that has led to the ASX dividend stock saying that its portfolio is 20% under-rented. In other words, when its properties come up for renewal, it could lead to a significant boost in the rental income.
The business is already experiencing that effect – in the FY26 first half, it reported like-for-like net operating income (NOI) of 5.1%. It's expecting its net rental profit per unit to increase by up to 6% in FY26. That's a great sign for the long-term, in my view.
