Real estate investments can be an excellent way to earn returns, generate cash flow, hedge against inflation and diversify an investment portfolio. However, buying physical properties can be costly, difficult and risky for an individual.
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Instead, investors can buy shares of diversified real estate investment trusts, or REITs. REITs are public companies that own large portfolios of real estate and pay dividends. There are many types of REITs, providing investors access to residential, commercial and specialty real estate. Here are 10 of the best REIT stocks to buy in 2025, according to Morningstar analysts:
| REIT Stock | Forward Dividend Yield | Upside Potential From Jan. 8 Close |
| Prologis Inc. (ticker: PLD) | 3.6% | 17.2% |
| American Tower Corp. (AMT) | 3.6% | 29.8% |
| Realty Income Corp. (O) | 6.0% | 42.8% |
| Crown Castle Inc. (CCI) | 7.1% | 54.3% |
| Extra Space Storage Inc. (EXR) | 4.3% | 11.1% |
| Equity Residential (EQR) | 4.0% | 18.6% |
| Ventas Inc. (VTR) | 3.0% | 22.6% |
| BXP Inc. (BXP) | 5.6% | 29.3% |
| SBA Communications Corp. (SBAC) | 1.9% | 35.2% |
| Weyerhaeuser Co. (WY) | 2.8% | 24.9% |
Prologis Inc. (PLD)
Prologis is an industrial REIT that specializes in logistics real estate. Analyst Suryansh Sharma says Prologis targets markets that have high population densities, high barriers to entry and growing consumption. Many of these properties are near markets with large labor pools and extensive transportation infrastructure. Sharma estimates the company’s current property portfolio has the potential to support $37 billion in new industrial projects over the long term. In addition, its strategic capital segment manages roughly $60 billion in third-party assets and generates significant fee revenue. Morningstar has a “buy” rating and $125 fair value estimate for PLD stock, which closed at $106.58 on Jan. 8.
American Tower Corp. (AMT)
American Tower is a specialized REIT that operates the world’s largest independent portfolio of wireless communications and broadcast towers. Analyst Samuel Siampaus says American Tower will likely target Africa as a key investment region, and he anticipates the underdeveloped continent will be a major growth opportunity in the next decade. Siampaus projects international organic tenant growth of 6% for American Tower and expects the company to continue to improve its cost structure. In fact, he projects the REIT can hit 45% operating margin by 2028. Morningstar has a “buy” rating and $230 fair value estimate for AMT stock, which closed at $177.17 on Jan. 8.
Realty Income Corp. (O)
Realty Income is a retail REIT that owns, develops and manages U.S. retail real estate with a focus on single-tenant buildings. It is the largest triple-net REIT in the U.S., meaning tenants pay all property expenses, including real estate taxes, maintenance and building insurance. Realty Income has a 6% dividend yield and makes monthly dividend payments, making it an attractive income source. Analyst Kevin Brown says most of Realty Income’s retail tenants operate defensive businesses that are insulated from e-commerce competition or cyclical economic downturns. Morningstar has a “buy” rating and $75 fair value estimate for O stock, which closed at $52.51 on Jan. 8.
Crown Castle Inc. (CCI)
Crown Castle is a specialty REIT that owns and operates wireless communications towers. The REIT is down about 23% in the past year, the worst performance on this list. The silver lining is that Crown Castle’s dividend yield has inched up to 7.1%, the highest on this list. Bloomberg recently reported Crown Castle is nearing a deal to sell its fiber business to TPG for $8 billion. Siampaus says the $8 billion price tag is disappointing, but pivoting away from fiber is the right strategy. Morningstar has a “buy” rating and $135 fair value estimate for CCI stock, which closed at $87.46 on Jan. 8.
Extra Space Storage Inc. (EXR)
Extra Space Storage is one of the largest publicly traded self-storage REITs. Sharma says the company’s core storage business is complemented by its lucrative insurance business and its strategic third-party management business. He says Extra Space’s storage facilities are located largely within three to five miles of high-income, densely populated urban centers. Sharma says the company’s third-party management business has helped Extra Space improve its data sophistication and expand its geographical footprint without significant capital investment. Self-storage is also considered a recession-resistant business, reducing investor risk. Morningstar has a “buy” rating and $165 fair value estimate for EXR stock, which closed at $148.43 on Jan. 8.
Equity Residential (EQR)
Equity Residential is a multifamily residential REIT that owns and operates a diversified portfolio of apartment properties. Brown says the REIT has done an excellent job over the past decade of restructuring its portfolio to focus on high-value, high-quality multifamily apartment buildings in coastal, urban markets with favorable demographic trends that allow the company to generate strong rent growth without sacrificing high occupancy rates. Equity has exited inland and southern markets and focused on high-growth, core markets such as San Diego and Los Angeles. Morningstar has a “buy” rating and $80 fair value estimate for EQR stock, which closed at $67.45 on Jan. 8.
Ventas Inc. (VTR)
Ventas is a health care REIT that specializes in health care facilities, including specialty care facilities, housing for seniors, medical office buildings and hospitals. Ventas shares are up about 20% in the past year, the best performance of any REIT on this list. Brown says the aging baby boomer generation will double the population of Americans aged 80 or above over the next decade, and this age group spends on average more than four times as much money on health care per capita as the average American. Morningstar has a “buy” rating and $70 fair value estimate for VTR stock, which closed at $57.07 on Jan. 8.
BXP Inc. (BXP)
BXP is an office REIT that owns office buildings in Boston, New York City, Los Angeles, San Francisco and Washington, D.C. Sharma says BXP’s strategy is to focus on supply-constrained markets that have attractive investment characteristics and strong economic growth trends. These properties tend to maintain high occupancy rates and elevated rental rates even during economic downturns. BXP’s management has also pledged to constantly refresh its portfolio to create value while maintaining a strong balance sheet and access to capital for future acquisitions. Morningstar has a “buy” rating and $91 fair value estimate for BXP stock, which closed at $70.33 on Jan. 8.
SBA Communications Corp. (SBAC)
SBA Communications is a specialized REIT that owns and operates a global wireless communications tower network. Siampaus says SBA is benefiting from improving U.S. carrier activity, particularly their focus on co-locations. The company is also investing in expanding its global tower network, including a recent acquisition of 7,000 towers in Central America from Millicom for $975 million. SBA has become the largest tower operator in Central America, and Siampaus says these types of opportunistic deals will continue to boost profitability and create value. Morningstar has a “buy” rating and $265 fair value estimate for SBAC stock, which closed at $195.89 on Jan. 8.
Weyerhaeuser Co. (WY)
Weyerhaeuser is a specialty REIT that grows timber and produces and sells forest products and pulp. Analyst Spencer Liberman says lumber prices will benefit from several producers curtailing production in the U.S. and Canada as producers seek to reduce supply. At the same time, Liberman anticipates growth in single-family home construction will drive lumber demand. He says Weyerhaeuser has shifted its focus to owning high-grade timber, including selling a significant portion of the least-productive land the company acquired from its 2016 Plum Creek buyout. Morningstar has a “buy” rating and $35 fair value estimate for WY stock, which closed at $28.01 on Jan. 8.
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10 of the Best REITs to Buy for 2025 originally appeared on usnews.com
Update 01/09/25: This story was previously published at an earlier date and has been updated with new information.
