Recent Purchase – ARCP

I had come across the term REITs (Real Estate Investment Trusts) a few times before, but never really took the time to look it up.

I was intrigued when ARCP and REITs were mentioned quite a but recently in a lot of dividend blogs that I regularly follow. So when I looked it up a bit more, it sounded interesting. Based on what I understood, REITs have real estate properties as investments that are leased out. The rental income that is realized is paid out as dividends to the shareholders. An interesting fact is that REITs are required to pay monthly dividends and their payout ratio is very high.

ARCP is one of the largest REITs in the country with properties in several markets. Its clients include several big name corporations. ARCP is a new position in my portfolio and I treat this as a highly speculative and risky investment. I invested in ARCP to get some exposure to real estate in addition to having a high yield.

I purchased 125 shares at $12.95. ARCP currently pays a monthly dividend of $0.0833/share which amounts to an yield of 7.71%. Overall, this investment adds $125.00 to my annual dividends.

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