Looking for an investment that can earn you 9-10%/year and never lose you a wink of sleep? (In fact, it may even induce sleep.)

It also comes with a 4.8% dividend yield.

It's like buying a high-yield bond with a AAA credit rating.

A quick thread 👇
Easterly Government Properties $DEA

Easterly is the second-largest owner of federally leased real estate in the country. The REIT currently owns 79 properties -- 99% of which are leased to federal agencies such as the FDA, FBI, VA, and (insert your favorite government acronym).
Easterly derives 99% of its income from long-term (10- to 15-year) leases with U.S. government agencies. The federal government doesn’t default on its obligations (yet at least).
Moreover, Easterly targets U.S. government agencies that have “enduring missions” -- those areas of the government that are growing, security-related, or otherwise critical to the functioning and operation of the country. Think FBI, FDA, VA – these agencies can’t be virtual.
90% of Easterly’s debt is fixed, with a weighted-average interest rate of around 3.5%. Better still, the company’s weighted-average lease term of 8.2 years exceeds the weighted-average maturity on its debt of 6.6 years.
In recent decades, the growth of GSA-leased properties has outpaced that of GSA-owned properties. That trend should only increase as the government seeks more ways to outsource property ownership and management.
Because of that, Easterly estimates that there are as many as 550 potential mission-critical government properties that fit its acquisition criteria, compared to its current portfolio of just 79 operating properties today.
Easterly is second only to privately held Boyd Watterson in terms of market ownership; Boyd’s share is 5.4%, while Easterly’s is just 3.7%.

Many other large players in the market, such as $JBGS and $BPY, aren’t exclusively focused on federal properties. Plenty of room to grow.
Since its 2015 IPO, Easterly’s shares have generated a total annual cumulative return of more than 10% with far less volatility than the average stock.
At 4.8% currently, Easterly’s dividend yield is well above that of the average REIT -- a good thing for income-seeking investors. And at a 77% adjusted FFO payout ratio, there should be upside to the dividend going forward.
As far as REITs go, it’s probably the lowest-risk opportunity I’ve come across so far, and that’s plain to see. When your portfolio consists of nothing but long-term, non-cancellable leases with the federal government, your cash flow visibility couldn’t be any clearer.
I think Easterly Government Properties is an excellent investment for those looking for a low-risk, income-producing REIT with leases backed by the full faith and credit of the U.S. government. $DEA is an investment you can count on -- and sleep on, too.
You can follow @MArgersinger.
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