On the subject of incomes passive earnings each month, Canadian actual property funding trusts (REITs) provide a steady supply of earnings. Canada’s actual property market is powerful, and the organized construction of REITs means that you can earn rental earnings with out the effort of managing the property and tenants. The truth is, you possibly can have a diversified pool of REITs catering to varied property mixes from residential, industrial, retail, business, and warehouse. A home could provide you with a 2.5% rental yield on the acquisition worth, however a residential REIT will give a better dividend yield.
A prime dividend inventory for a month-to-month passive earnings
Granite REIT (TSX:GRT.UN) is one such inventory. It’s among the many few Canadian REITs which have elevated distribution per share yearly for the final 15 years regardless of the macro headwinds. Its enterprise resilience comes from its diversified portfolio of 134 income-producing properties unfold throughout North America and Europe. It has six extra properties below improvement.
Round 70% of Granite’s properties are for distribution and e-commerce, and the remaining 30% for warehouse and particular functions. It retains buying and growing new properties that meet e-commerce wants corresponding to chilly storage, multi-level fulfilment, and transport services. The REIT focuses on properties with decrease capital expenditure and scope for enlargement and redevelopment. This manner, it might probably modernize its properties to fulfill altering e-commerce developments.
The REIT’s largest tenant is Magna Worldwide, which leases 20% of gross leasable space and contributes to 27% of the REIT’s annual income. Through the years, the REIT has diminished its dependence on Magna from 90% in 2012 and can proceed to take action. Its prime 10 tenants account for 46% of its annual lease. That explains its resilience to macro disaster.
On the steadiness sheet entrance, Granite has decrease debt than the business common. Its internet debt is 35% of the honest market worth of its properties, and earnings earlier than curiosity, taxes, depreciation, and amortization (EBITDA) is 5.1 occasions its curiosity on loans as of October 31, 2025. This exhibits that it might probably comfortably pay its debt even in a lean interval.
Purchase 195 shares of this prime dividend inventory for $57/month in passive earnings
Granite REIT has been paying and even rising its distributions yearly by increasing its income-producing properties and reducing debt. This helped cut back its dividend payout ratio from 79% of funds from operations (FFO) in 2019 to round 58% in 2025, whereas rising dividends at a median annual price of three%. Such sturdy figures present that the REIT can fund most of its developments and likewise develop dividends in lean intervals when occupancy falls.
For 2026, Granite has elevated the dividend per share by 4% to $3.55. So, should you purchase 195 models of Granite REIT now, you will get a complete passive earnings of $692.25 within the subsequent 12 months or $57 per 30 days. The REIT is presently buying and selling above $76 and can provide a yield of 4.7%, which is best than what you’ll get should you lease a home.
Investor takeaway
The perfect half concerning the REIT is that the payout begins instantly from subsequent month onwards and doesn’t lure a whole lot and hundreds of {dollars}. So, for $57 per 30 days, you may be paying round $15,000 to purchase 195 shares. If the REIT grows its distribution by 4%, your passive earnings will alter to inflation.
Whenever you don’t want the cash, you need to use the dividends to purchase extra models of Granite and compound your passive earnings.
