Retirement REITs — Public Storage (PSA)
Dividend yield: 3.3%
No list of quality retirement REITs would be complete without Public Storage (PSA), the world’s largest landlord of self-storage units. Since building its first self-storage facility in 1972, Public storage has grown into an empire of more than 2,200 locations in the United States and Europe, totaling more than 142 million net rentable square feet. And its PS Business Parks interest adds another 28 million rentable square feet of commercial and industrial space.
Storage lockers have been a big business in recent years, and the housing bust was certainly a contributor. Americans who lost their homes or were forced to downsize had to put their belongings somewhere. But even as the housing market recovers, demand should remain high for storage lockers due to demographic factors.
Baby Boomers are starting the process of downsizing, selling their large suburban homes now that their children have left the nest. As they settle in to smaller digs, they will need to find a place to store their belongings. Public Storage will be the first number they call.
Public Storage pays a safe and respectable yield of 3.3%. It has also been a monster dividend raiser. Public Storage has raised its quarterly dividend from 22 cents per share in 2000 to $1.40 today. And the rate of increases is accelerating; the REIT has more than doubled its dividend since 2010.