4 High-Yield Real Estate Stocks to Buy as Investors Get Defensive
Consumers are about as pessimistic about the state of the economy as they have ever been, amid a weakening labor market, disruptions related to the fall 2025 government shutdown, and concerns about an AI bubble. Though the S&P 500 appears to be continuing its ascent, having climbed by almost 17% this year, it is not surprising that investors are growing cautious as they wait for a (potentially major) course correction. Even after backing off from all-time highs in recent weeks, gold is trending upward once again, a sign that investors are seeking defensive plays.
One often-overlooked source of stability when investors are cautious is the real estate investment trust (REIT) space. These companies pay out the majority of their taxable income as dividends, helping to provide investors with a steady stream of passive income even if other sections of the market are poised to fall. Below are four REITs worth a closer look, each offering high yields and potential upside.
American Tower: Data Centers and Dividends in Focus
Wireless infrastructure operator American Tower (NYSE: AMT) is among the largest REITs available, with a market capitalization of nearly $87 billion. The company has been buoyed by strong data center demand, which helped to drive better-than-expected revenue above $2.7 billion—up 8% year-over-year (YOY)—in the latest quarter. Services revenue also surged, fueling strong adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) growth as well. The firm consequently raised full-year 2025 guidance across multiple categories.
Though American Tower is not without risks, including potential volatility in its cell phone tower properties, this REIT has excellent liquidity of nearly $11 billion. As a result, it has substantial room to engage in share buybacks, capital expenditures, and dividend distributions. American's dividend yield is an impressive 3.68%, having improved by nearly 12% on an annualized five-year basis.
Analysts see AMT shares also appreciating in value as the company is well-positioned to capitalize on infrastructure trends. AMT stock has a consensus price target above $231, indicating more than 25% in upside potential, and 15 out of 20 analysts rate shares a Buy.
Franklin BSP: High Yield, Higher Risk
Franklin BSP Realty Trust Inc. (NYSE: FBRT) focuses on a portfolio of single-tenant net-leased commercial properties. FBRT shares have pulled back by almost 20% year-to-date (YTD), resulting in a massive dividend yield above 14%.
The company's successful acquisition of real estate finance platform NewPoint has also contributed to dividend yield growth.
While the sky-high dividend yield is attractive to investors, it also raises red flags, as the company has dipped into its cash reserves to finance its distributions.
Still, FBRT shares are undervalued compared to many other firms in the financials sector—its price-to-earnings ratio of 12.6 is well below the sector's average of 22.4.
FBRT shares get an overall Buy rating based on the support of five out of six analysts, and the company is projected to see its stock climb by more than 45%.
NETSTREIT: Exceptional Liquidity and a Rising Dividend
NETSTREIT Corp. (NYSE: NTST), like Franklin above, targets single-tenant net lease properties, although with a focus on retail rather than commercial spaces.
Unlike Franklin, however, NETSTREIT has outperformed the market by a wide margin this year, returning more than 32% YTD.
Despite a disappointing top-line performance in the last quarter, this firm has rock-solid fundamentals, including 99.9% occupancy across its properties.
Even better, NETSTREIT bolstered its liquidity in the third quarter thanks to a $209.7-million share offering, bringing its total liquidity to over $1 billion.
This is in addition to closing on roughly $204 million in acquisitions last quarter. It's no surprise, then, that the company provides a dividend yield of 4.67%. NTST shares could climb by another 11% in the near-term, according to analysts, as 11 out of 13 call the stock a Buy.
Iron Mountain: A Data-Driven Dividend Story
Iron Mountain Inc. (NYSE: IRM) provides secure storage facilities and services, differentiating its scope from that of the other firms on this list. The company is fresh off a strong earnings performance for the third quarter, with 13% YOY revenue improvement of $1.8 billion, and a 16% boost to adjusted EBITDA. These and other gains are largely due to significant growth in its data center business.
Iron Mountain plans to bring online 450 megawatts of data center capacity over the next two years—a major expansion that supports growing digital storage demand.
Signed leases suggest that the firm's data center business will increase by at least a quarter next year alone.
With a dividend yield of 3.41%, Iron Mountain is converting its business into distributions for investors.
However, its rapid expansion rate makes the payout ratio a high 651%, suggesting that Iron Mountain's dividend lacks stability relative to the other firms on this list. Still, six of the eight analysts rating the firm give it a Buy, projecting more than 17% upside.
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