- Leonberg Capital President Jussi Askola, an experienced real-estate investor, shared three REITS with Business Insider that he believes are worth investing in right now.
- Each of IRT, MNR, and UMH taps into an essential market, making them more likely to weather the economic downturn, Askola explained.
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Jussi Askola began investing in REITs about 10 years ago, and has invested in various markets including the US and Germany.
Currently the president of Leonberg Capital, a boutique investment research firm, Askola is also a former private equity real estate investor and the author of “High Yield Landlord,” a top-ranked real estate service on Seeking Alpha, an online platform that provides stock market and financial analysis.
Investing in REITs has been volatile since March. As The Wall Street Journal reported, traditionally stronger sectors like offices, hotels, and retail have suffered while REITs heavy in data centers and cell towers are likely to see an increase in value as the world adjusts to social distancing.
In the midst of the coronavirus pandemic, Askola gave Business Insider three REITs he finds strong investments right now.
1. Independence Realty Trust (IRT)
This REIT is currently a low-risk investment, in Askola’s opinion. He pointed out that it specializes in class B apartment communities in high-growth US markets and focuses on affordable housing.
“We like this REIT because apartments are fairly resilient simply because everyone needs shelter, even in a recession,” he explained.
IRT’s stock last closed at $8.61, compared to a 52-week high of $16.85, and a 52-week low of $6.86.
2. Monmouth Real Estate Investment (MNR)
This REIT, Askola explained, specializes in industrial space and focus on the ecommerce sector. It leases distribution centers to companies including Amazon.
The ecommerce sector was doing well before the pandemic, and now that people can’t leave the house, they are looking to these companies now more than ever to buy the things they need.
Askola explained that he likes MNR because it has long-term leases, which makes its cash flow more resilient and the trust more “defensive” during an economic downturn.
MNR’s stock last closed at $12.02, compared to a 52-week high of $15.53, and a 52-week low of $8.42.
3. UMH Properties (UMH)
UMH, which specializes in manufactured home communities, is similar to IRT because it also focuses on affordable housing, Askola said.
He noted that manufactured homes, also known as mobile homes or trailers, are one of the most “defensive” residential property sectors, as they’ve been one of the largest sources of non-subsidized affordable housing the US for decades.
UMH’s stock last closed at $10.91, compared to a 52-week high of $16.64, and a 52-week low of $8.63.