Timber & Farmland REITs: Ultimate Inflation Hedges

March 16, 2022 | Hoya Capital

Timber & Farmland REITs: Ultimate Inflation Hedges REIT Rankings Sector R... Mar 16 Written By Publicly-traded landowners - specifically timber and farmland REITs - have been among the best-performing real estate sectors this year amid concerns over persistent inflation and soaring commodities prices. Amid the ongoing conflict with Russia- which is among the world's largest exporters of agriculture, gasoline, and timber products- the importance and value of North American production will become evident.

For timber REITs, record profitability last year translated into significant dividend growth. With lumber prices again pushing towards record-highs from resilient housing demand, the positive momentum looks poised to continue. Buying land has been a "hot trade" over the past year, and valuations appear extremely rich for farmland REITs with implied cap rates in the 2-3% range, but valuations of higher-quality timber REITs remain quite attractive. For investors that can tolerate the volatility, timber REIT fundamentals are especially compelling given the record-low housing supply, a substantial backlog of new home orders, and deferred home improvement spending.

Click Here To Read The Full Report on Seeking Alpha! Comments (0) Newest First Oldest First Newest First Most Liked Least Liked Add Comment --> Preview Edit --> Post Comment… Previous Previous Fed Hikes • Peace Talks • Retail Sales Next Next Double-Digit Inflation • Stocks Rebound China COVID Lockdowns