Glossary

Dividend Yield (REIT)

Also known as: REIT Dividend Yield

A REIT's annualized per-share dividend divided by its current share price, expressing the cash income return an investor receives from holding REIT shares at the prevailing market price.

Because REITs are required to distribute the large majority of their taxable income to preserve pass-through tax status, dividend yield is a central metric for REIT investors, often compared across property sectors and against the REIT's own AFFO payout ratio to assess dividend sustainability and coverage. A REIT dividend yield that is unusually high relative to peers can reflect market skepticism about the sustainability of the payout (signaling elevated risk of a future dividend cut) rather than simply an attractive income opportunity, particularly if the payout ratio (dividends divided by AFFO) exceeds 100% for an extended period. Dividend yield also moves inversely with REIT share price independent of any change in the underlying business, so CRE professionals interpret yield changes alongside NAV and AFFO trends rather than in isolation.