Cellular, Data And Logistics REITs Could Be The Perfect Trifecta
Investing in this REIT trifecta might be the fastest route to getting the best returns, according to Cohen & Steers REIT portfolio specialist Evan Serton.
High demand for mobile data is driving strong returns in cell tower REITs, data center REITs and industrial REITs. Mobile traffic has already seen strong growth, but is expected to increase by 35% annually within the next five years, which will only serve to benefit these REITs and their investors all the more, Serton told Forbes.
Safe, cash-generating commercial real estate investments have been difficult to come by lately because of high property prices and the long length of the cycle, but this combination could serve as the solution.
The reason all three categories are profiting from this trend is because they are all necessary for the transmission and storing of data. Cell towers transmit the data, but data centers are necessary in order to store and process that information in the cloud. Industrial REITs are essential because the logistics warehouse is the last stop on the mobile data journey. According to Forbes, it works in a similar manner to a smartphone transmitting a purchase. The data center would receive that purchase and then send it to the warehouse where it would be fulfilled and shipped to a customer’s home.