Published on March 31st, 2025 by Felix Martinez
BSR Real Estate Investment Trust (BSRTF) has three appealing investment characteristics:
#1: It is a REIT so it has a favorable tax structure and pays out the majority of its earnings as dividends.
Related: List of publicly traded REITs
#2: It is offering an above average dividend yield of 4.2%.
#3: It pays dividends monthly instead of quarterly.
Related: List of monthly dividend stocks
You can download our full Excel spreadsheet of all 76 monthly dividend stocks (along with metrics that matter, like dividend yield and payout ratio) by clicking on the link below:
BSR Real Estate Investment Trust’s trifecta of favorable tax status as a REIT, an above-average yield, and a monthly dividend make it appealing to individual investors.
But there’s more to the company than just these factors. Keep reading this article to learn more about BSR Real Estate Investment Trust.
Business Overview
BSR Real Estate Investment Trust is an internally managed, open-ended REIT that owns a portfolio of 32 multifamily garden-style residential properties located in attractive primary and secondary markets in the Sunbelt region of the U.S. The REIT’s residential properties have 8,904 units in total. It was founded in 1956 and became focused on multifamily housing in 1991.
Source: Investor Presentation
Sunbelt markets have enjoyed superior population and economic growth for decades and are likely to continue growing much faster than the rest of the country. As a result, BSR REIT is ideally positioned to enjoy above-average rent growth in the upcoming years.
BSR REIT has high-quality, affordable residential properties, which enjoy strong demand throughout all phases of the economic cycle. In addition, its properties require lower maintenance expenses than typical urban properties.
Moreover, multifamily REITs have outperformed most other categories of REITs over the last two decades.
Source: Investor Presentation
As shown in the above chart, multifamily REITs have outperformed retail REITs and office REITs by an impressive margin over the last 20 years. The outperformance has resulted primarily from much less competition in this business as well as strong demand for multifamily housing.
BSR REIT enjoys strong business momentum right now. The company reported its financial results for the fourth quarter (Q4) and full year results on March 5th, 2025. The company eported solid financial results for Q4 and FY 2024, with revenue reaching $42.2M for Q4 (+0.2% YoY) and $168.7M for FY 2024 (+0.5% YoY). Same Community revenue increased 0.4% annually, while NOI grew 1.3%. Weighted occupancy rose slightly to 95.6%. AFFO per unit hit a record $0.88 (+3.5% YoY), and the payout ratio remained stable at 60.3%. The REIT also completed the construction of Aura 35Fifty (238 units, Austin, TX) and was again recognized as a top workplace in multifamily housing.
During FY 2024, BSR maintained financial discipline by reducing debt by $8.8M and extending $160M in mortgage notes to 2026. The company also executed a $42M interest rate swap at 3.13%. However, Q4 saw a decline in FFO (-10.6%) and AFFO (-12.6%) due to lower NOI and higher operating costs. NAV per unit fell to $16.75 (-5.4% YoY), primarily due to slight cap rate expansion and lower cash flow trends.
In early 2025, BSR took significant strategic actions, including the redemption of $41.5M in convertible debentures and the $61M acquisition of Venue Craig Ranch (277 units, McKinney, TX). The REIT also announced the pending sale of nine stabilized properties for $618.5M, aiming to reinvest in higher-yielding assets. CEO Dan Oberste emphasized the company’s ability to generate strong cash flow despite industry capital challenges and expressed confidence in BSR’s future growth.
Growth Prospects
Millennials have exhibited a greater propensity to rent as they pursue a more flexible lifestyle. As millennials comprise about 25% of the population in BSR REIT’s core markets, the REIT enjoys strong demand for its properties and has ample room for future growth.
BSR REIT also greatly benefits from the superior population growth and economic growth experienced in Sunbelt markets.
Source: Investor Presentation
Thanks to this characteristic of its core markets, the REIT has enjoyed strong rent growth year after year.
It is also worth noting that BSR REIT divested 39 non-core properties during 2019-2021 for total proceeds of $760.5 million. The company thus reduced the average age of its properties from 29 to 11 years, drastically reducing its capital expenses.
During the last three years, BSR REIT has exhibited a somewhat volatile business performance, primarily due to the pandemic. Nevertheless, it has grown its adjusted FFO per unit by 7.7% per year on average over this period. Thanks to BSR REIT’s promising growth prospects, we expect 5.0% average annual growth of FFO per unit over the next five years.
Dividend & Valuation Analysis
In contrast to many REITs, which cut their dividends in 2020-2021 due to the coronavirus crisis, BSR REIT proved resilient to that downturn thanks to its robust business model. The REIT incurred just a 12.5% decrease in its FFO per unit in 2020 while it kept its dividend flat. Even better, it has now fully recovered from the pandemic.
BSR REIT has a short dividend record, as it initiated a dividend only in 2018. The stock currently offers a 4.2% dividend yield. Thanks to its solid business model, its healthy payout ratio of 65%, and its interest coverage of 3.7, the trust is not likely to cut its dividend.
In reference to the valuation, BSR REIT has traded for 15.0 times its adjusted FFO per unit in the last 12 months. Given the trust’s somewhat volatile and relatively short performance record, we assume a fair price-to-FFO ratio of 14.0 for the stock. Therefore, the current FFO multiple is higher than our assumed fair price-to-FFO ratio. If the stock trades at its fair valuation level in five years, it will incur a -1.7 % annualized drag in its returns.
Taking into account the 5% annual FFO-per-share growth, the 4.2% dividend, and a -1.7% annualized contraction of valuation level, BSR REIT could offer just a 7.5% average annual total return over the next five years. This is a lackluster expected return, so investors should wait for a more opportune entry point.
Final Thoughts
BSR REIT has the advantage of owning multifamily properties in Sunbelt markets, which are characterized by superior economic growth and strong demand for this type of property. The REIT also proved relatively resilient throughout the coronavirus crisis, defending its dividend, in sharp contrast to many other REITs. As the stock also offers a 4.2% dividend yield with a healthy payout ratio of 65%, it is an attractive candidate for the portfolios of income-oriented investors.
On the other hand, investors should be aware that BSR REIT is not a high-growth REIT, and hence, it is prudent to try to have a wide margin of safety regarding the valuation of the stock. BSR REIT appears almost fairly valued right now. Therefore, investors should wait for a meaningful correction before purchasing the stock.
Don’t miss the resources below for more monthly dividend stock investing research.
- The Monthly Dividend Stocks List
- 20 Highest Yielding Monthly Dividend Stocks
- 10 Cheapest Monthly Dividend Stocks
- 10 Safest Monthly Dividend Stocks
- 3 Top ‘Hold Forever’ Monthly Dividend Stocks
And see the resources below for more compelling investment ideas for dividend growth stocks and/or high-yield investment securities.
- Dividend Kings: 50+ years of rising dividends
- Dividend Champions: 25+ years of rising dividends
- Dividend Aristocrats: 25+ years of rising dividends and in the S&P 500
- Dividend Achievers: 10+ years of rising dividends and in the NASDAQ
- High Dividend Stocks: 4%+ dividend yields
- Blue Chip Stock: Kings, Aristocrats, and Achievers
- MLPs: List of MLPs and more
- REITs: List of REITs and more
- BDCs: List of BDCs and more