This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Ready for Retirement: 3 Health Care REITs That Outperform

Stocks in this article: MPW OHI HTA

NEW YORK ( TheStreet) -- When it comes to retirement and savings, REITs are well positioned to play an important role -- both as an investment to help build a retirement portfolio and also to provide income to meet living expenses. It's important to remember that REITs are forced, by law, to payout at least 90% of their taxable income to their shareholders in dividends -- a crucial differentiation that makes the income highly sustainable, in good times and bad.

Another key differentiator is that REITs are low to moderately correlated with non-REIT stocks and bonds; conversely, over the long term, REITs help to reduce overall portfolio volatility and cushion the "zigs and zags" caused by Mr. Market, prior to and during the retirement years. Also, REITs are a proven and effective hedge that can help shield portfolios against inflation. As you know, rising inflation can sap the sweetness out of a retirement portfolio faster than my daughter can spend $300 at Forever 21. (Sorry Lauren, but you know it's true).

Speaking of inflation, I really like the Health Care REITs. The growing sector -- fueled by The Affordable Care Act and the expected increase in utilization of health services -- will continue to be a durable and defensive REIT class. It's a fact that people don't tend to change their health care spending patterns, regardless of economic conditions. The demand for patience is expected to rise considerably as an additional 35 million to 45 million insured patients make their way into the buildings occupied by the health care operators. That trend will bring meaningful exposure to hospitals, medical office buildings, lab space and assisted living facilities.

Health Care Outperforms

Over that last year, the Health Care REITs have outperformed all of the other REIT sectors. The prized performer -- the Health Care REITs -- returned a whopping 25.89% year over year, while the silver medal went to the Shopping Center sector (23.91%) and the bronze medal went to the Industrial sector (23.81%). The runner-up finalists were Malls (20.44%) and Self-Storage (19.54%). The S&P 500 trailed, with a year-over-year return of 15.74%.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs