The 5 Best-Performing REITs of 2022

Investors will remember 2022 as a really tough year for Wall Street. 

Inflation, rising interest rates, a war in Ukraine and fears of a recession were pervasive across the headlines and ultimately brought all three major indices down into bear market territory. If you managed to break even or make a little bit of money this year, pat yourself on the back for doing a great job.

Real estate investment trusts (REITs) were hit particularly hard by the 2022 headwinds, but not all of them lost money. Knowing which ones bucked the bearish trend could give investors a helping hand going into 2023. These were REITs whose quarterly operating results were improving and/or dividends were growing.

While there’s no guarantee that the best-performing REITs in 2022 will repeat their performances in 2023, it’s still a good place to start when considering which stocks to purchase. With that in mind, take a look at the five best-performing REITs of 2022.

Getty Realty Corp. GTY is a Jericho, New York-based retail REIT that specializes in owning, leasing and financing 1,021 freestanding auto-related properties across 38 states and Washington, D.C.

Almost three-quarters of Getty Realty’s properties are gas stations and convenience stores. Another 12% are car washes, 11% are automotive repair shops, and the remainder are auto service and auto parts stores. At the end of the third quarter, it had 99.6% of its properties occupied.

Getty Realty grew its third-quarter revenue and funds from operations (FFO) by over 4% from the third quarter of 2021 and increased its dividend from $1.58 per year to a forward $1.72 during 2022.

Getty Realty’s total return for 2022 is 16.97%.

VICI Properties Inc. VICI is a New York-based experiential REIT that specializes in owning and operating gaming, hospitality and entertainment properties. Its triple-net portfolio includes well-known Las Vegas hotels such as Caesars Palace, MGM Grand Las Vegas Hotel & Casino and the Venetian Resort Las Vegas. In total, Vici Properties’ portfolio consists of 43 gaming facilities with 58,700 hotel rooms and over 450 restaurants, bars, nightclubs and sportbooks.

One reason VICI Properties has been able to perform well during a rising interest rate period is that over 40% of its leases have lease escalators for inflation. Investors in VICI Properties were not concerned about the rising inflation this year.

VICI Properties’ total return for 2022 is 14.26%.

Gaming and Leisure Properties Inc. GLPI is similar to VICI Properties in that it’s a specialized REIT that owns and triple-net leases 57 gaming properties across 17 states. Its tenants include Penn Entertainment Inc. PENN, Caesars Entertainment, Boyd Gaming Corp. BYD and others. The quarterly dividend is $0.705 per share, and this was a 5% increase from 2021.

Gaming and Leisure Properties’ total return for 2022 is 13.49%.

Transcontinental Realty Investors Inc. TCI is a diversified REIT that acquires, finances, operates and leases apartments, office buildings, warehouses, hotels and retail centers, with a focus on purchasing undervalued or underperforming properties.

Although Transcontinental Realty Investors does not pay a dividend, its operating results were very good. Net income rose from $26.2 million in the third quarter of 2021 to $378.4 million in the third quarter of 2022. Its rent collection of 99% and total occupancy of 94% was top notch.

Transcontinental Realty Investors’ total return for 2022 is 10.37%.

LTC Properties Inc. LTC is a Westlake, California healthcare REIT that owns and leases senior housing and skilled nursing facilities. LTC Properties’ revenue is derived from triple-net leases, mortgages and mezzanine loans on its 32 operators. LTC Properties has about $1.65 billion in assets from 210 properties across 29 states.

LTC Properties increased its third-quarter revenue of $43.5 million by 16.1% over the third quarter of 2021 and FFO of $0.45 per share rose by 33% over the third quarter of 2021. 

LTC Properties’ total return for 2022 is 9.42%.

Weekly REIT Report: REITs are one of the most misunderstood investment options, making it difficult for investors to spot incredible opportunities until it’s too late. Benzinga’s in-house real estate research team has been working hard to identify the greatest opportunities in today’s market, which you can gain access to for free by signing up for Benzinga’s Weekly REIT Report.

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