Digital Realty Trust
First up is tech REIT Digital Realty Trust (DLR). DLR is a real estate investment trust that owns 96 properties: mainly datacenters, internet gateways, and manufacturing facilities. In all, the firm owns more than 16.8 million square feet of leasable space.
Digital Realty's niche focus gives it some big advantages. For starters, demand for internet datacenters and gateways continues to grow as data-driven services (like cloud storage) continue to grow in popularity. As long as firms need more virtual space to store data, they'll also need more physical space to store servers; that's space that DLR is uniquely qualified to provide. And as a result, switching costs are high for tenants who decide to lease space from Digital Realty.>>6 Oversold Stocks Ready to Bounce Higher Like most other REITs, DLR is effectively an income-generation tool. The firm enters into long-term triple-net leases with tenants, an arrangement that takes most of the risks off of DLR's balance sheet and puts the onus on tenants instead. The result is a predictable income stream and a hefty 3.9% dividend yield right now. Watch for earnings on July 25.
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