It has since been updated and republished.]. Data centers trade at 94% of net asset value, versus 100% for REITs overall. Analysts forecast that investors expect more digital connections to drive hybrid cloud commuting and interconnectivity. The company’s total one-year return as of the end of September was 29.23%. To learn more about CafeMedia’s data usage, visit: www.cafemedia.com/publisher-advertising-privacy-policy. Copyright © 2021 InvestorPlace Media, LLC. Thus, we are going to see the huge growth in Data Centers in the REIT space moving forward. Like QTS Realty Trust, CyrusOne (NASDAQ:CONE) is an underperforming company that is said to be attractive to acquirers. It is required to send 90% of earnings back to investors in the form of dividends. It expanded into Europe through the 2018 acquisition of Zenium for $442 million. If you’re on the right side of a trend, you are almost certain to prosper. “The attractiveness of data REITs is in their high dividend yield, in contrast to most firms in the tech sector,” she said. Long-term trends appear to be good for the sector. Digital Realty recently expanded its presence in Northeast Asia with a 129,000-square-foot, carrier-neutral facility in Seoul. It was then called CRG West, and the location was where Internet Service Providers hooked into phone networks, and where enterprises could go for big bandwidth. Higher network traffic drives the need for servers, storage devices and communications gear. Learn more.Already a member? One of the good things about data center REITs is that their growth isn’t dependent on consumers spending money. Data Center REITs offer hosting, colocation and cloud on-ramps to enterprises and Internet Service Providers. All rights reserved. Digital Realty’s one-year return was 19.64% as of the end of September. The shares are up about 270% in the last five years, while quarterly dividends have tripled from 36 cents per share in 2014 to $1.10 now. Let time work for you. Will the good times last? And with a set of unfair advantages that are completely unheard of with other investments, it’s no surprise why. The company’s biggest deal came in 2017, a $7.8 billion agreement to buy DuPont Fabros Technology. This is key to successful income investing. For real-estate investment trusts, or REITs, that make money by hosting data, the more people pretend to work from home and watch Netflix, the better. How to Buy Your First Investment Property With 5% Down (Or Less), These REITs are Immune to the Coronavirus' Impact, Cities and States That Have Paused Evictions Due to COVID-19, The Metros Where Retail CRE will be Hit the Hardest. Simply click here to learn more and access your complimentary copy. Executives say recent strategic acquisitions have led to significant growth in their colocation and interconnection capabilities. Millionacres does not cover all offers on the market. Equinix (NASDAQ:EQIX) was founded in Redwood City, California in 1998 and has focused on global services almost since its inception. The forecast for data centers is positive thanks to a number of demand drivers that will likely keep data center REITs growing and expanding their operations. But those barriers have come crashing down - and now it’s possible to build REAL wealth through real estate at a fraction of what it used to cost, meaning the unfair advantages are now available to individuals like you. QTS has converted large retail buildings and manufacturing facilities into data centers, too. You probably know that real estate has long been the playground for the rich and well connected, and that according to recently published data it’s also been the best performing investment in modern history. To a current buyer that’s a yield of just 2.17%. 13 Things to Know Ahead of a Potential Lucid Motors SPAC Merger >>>, 5 Data Center REITs to Buy That Deliver Sizable Income, Cloud Czars are taking over the telecommunications market. Data centre REITs have exhibited fantastic growth since their existence more than a decade ago. But five years ago, the stock was trading at $172 per share. Its early expansion was funded by the Carlyle Group, a private equity firm. QTS began life in Kansas, in 2003, expanded into Atlanta through a 2005 acquisition, and now has 25 data centers with 5.7 million square feet of rentable space. The vaccine-driven sector rotation within the REIT sector has further pressured these "work from home winners." Publicly traded data center providers continue delivering incredible returns year … Find out the details you need to know about tech and data center REITs. Learn more! Data center REITs can be a relatively low-risk way to invest in the technology industry. He is the author of a new mystery thriller, The Reluctant Detective Finds Her Family, available now at the Amazon Kindle store. Of its 1,000 customers, almost a quarter are Fortune 1,000-size companies. Put Real Estate’s “Unfair Advantages” to Work for Your Portfolio. With effect from 01 Jan 2017, REITDATA will incorporate both Filter and Sort features on the tables for Daily Yield Reporting for REIT and Other Trust. © 2018 - 2021 The Motley Fool, LLC. Add a 19% one-year gain in the stock price and you get a total return of about 22%. The company today has 45 data centers, mostly in the U.S., but it also has operations in Europe and Singapore. Don’t just focus on the current yield. It bills itself as offering “hybrid cloud solutions,” with its close connections to big clouds like Amazon and Microsoft, and colocation services for enterprises building their own cloud systems. Data Center Real Estate Investment Trusts (REITs) manage, develop and own data center facilities, offering solutions to individuals along with small, medium and large companies. Sign in here. Data Center REITs offer hosting, colocation and cloud on-ramps to enterprises and Internet Service Providers. Investing in them can provide steady returns as this sector grows. It was founded in 1998, as the internet was primed to revolutionize how people interacted and shared information. Brad Thomas of iREIT Investor notes that, while Digital Realty is an aggressive acquirer of data centers, it doesn’t account for acquisitions aggressively, which means it’s not stressing its balance sheet at the expense of the long term. Data center REITs are enjoying a rebound in stock prices this year after big gains in 2016 and 2017 before falling off some in 2018. CyrusOne was founded in 2001. 1125 N. Charles St, Baltimore, MD 21201. All this makes Equinix one of the best data center REITs to buy. The company also broke ground last month for its third center in Singapore. There are five data center REITs in the market today and they're primarily based in the United States. The REITs who have the data centers in the current / future portfolio: (1) Keppel DC REIT (AJBU.SI) – 100% (AUM$2.9B) . The digital economy has experienced exponential growth, and Cisco Systems expects this pattern to continue through several coming years. Become a diversified real estate investor without ever talking to an agent or swinging a hammer. Data Center REITs have outperformed the broader REIT sector over the last five years, as well, and are expected to perform favorably as data center demand and economic conditions remain positive. CoreSite is the right stock for you if you’re mainly looking for exposure to the U.S. internet market. Data centers are one type of property you can invest in but other sectors of REITs include apartments, retail, and offices. CoreSite was born from two “telecom hotels,” as they were called then, in 2001, in San Francisco. This REIT had a one-year total return of 36.93% at the end of September. Operating cash flow has also doubled. Did Elon Musk Tweet Have Investors Piling Into SIGL Stock? This can be the downfall of retail and hotel REITs. The Asian financial center had a much-publicized early success in containing the pandemic before an outbreak in dormitories densely packed with foreign workers, sending numbers soaring. Data centre real estate investment trusts (REITs) are companies that own real estate for the purpose of housing data centres. It was founded in 2003 and has been an advocate for data centers in the Midwest. It now has 214 centers with 34.5 million square feet of rentable space in the U.S. and Europe. Need help interpreting the REIT data? The new benchmark, which has been added to the widely-tracked FTSE Nareit U.S. Real Estate Index Series, includes listed REITs from the infrastructure, data center, and … Here is the story on the four major names in the space. Sign in here. The five data-center REITs are CoreSite Realty Corp. (ticker: COR ), Digital Realty Trust ( DLR ), Equinix ( EQIX ), CyrusOne ( CONE) and QTS Realty Trust ( QTS ). This Site is affiliated with CMI Marketing, Inc., d/b/a CafeMedia (“CafeMedia”) for the purposes of placing advertising on the Site, and CafeMedia will collect and use certain data for advertising purposes. It has a market cap of $40 billion, and last year delivered $9.84 per share in dividends to its shareholders. It is, like the other REITs, a great long-term holding. This allows reader to sort the table (Yield / Gearing sort may be useful) or filter to a particular company to look at its data. The company’s one-year return was 15.15% as of the end of September. A business that began with small warehouses in central cities, where phone exchanges interconnected, is now built on finding big parcels of empty land near where cloud giants intend to build. But I’ve found REITs to buy whose prices tend to rise over time . Public cloud providers such as Apple, Amazon, Facebook, Google, and Microsoft are spending big bucks on data centers and have helped fuel their growth. If you bought some shares five years ago, the current dividend would give you a yield of 5.75%. The company also expects to see more demand in the European markets. But that means that other companies’ shareholders aren’t getting a big chunk of your gains and that the stock isn’t being watered down with new shares. The Ascent's Best Cities for a High Salary and Low Cost of Living -- How Does the Real Estate Measure Up? As data becomes an integral part of everything we do, data center real estate investment trusts (REITs) have become more important. 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