Investing in Canadian REITs in 2025

Investing in Canadian Real Estate Investment Trusts (REITs) offers a convenient way to add real estate exposure to your portfolio – without making major lifestyle changes.

While buying a rental property and becoming a landlord is one option, it’s not for everyone. If you don’t have the time, energy, or cash/capital to manage physical real estate, Canadian REITs can be an attractive alternative. They allow you to invest in real estate through small, manageable amounts—no tenants or property maintenance required!

Canadian REITs are generally easy to buy and sell since most are listed on the Toronto Stock Exchange and trade just like regular stocks. This liquidity makes them an accessible entry point into the real estate market for everyday investors.

In this post, we’ll walk you through the basics of investing in Canadian REITs, explore how they work, and highlight some of the top REITs to watch in 2025. We’ll also share tips on choosing the right REITs and how they stack up against other real estate investment options.

Best Canadian REITs Comparison

If you are ready to dive right into the world of Canadian REITs, you’ve got plenty to choose from. Selecting your own portfolio of REITs allows you to specialize in a specific type of real estate, whereas a REIT ETF may not.

Our top choices allow you to gain exposure to residential, retail, commercial, and industrial REITs in Canada.

	Real Estate Assets	Price Per Share*	Market Cap	Dividend Yield*
Allied Properties REIT (AP-UN.TO)	Owns approximately 200 properties throughout major cities in Canada with a focus on office space and data centers.	$17.16	2.398B	10.49%
Canadian Apartment Properties REIT (CAR.UN)	The largest REIT in Canada, it operates nearly 47,000 rental apartments and housing sites in Canada, Ireland, and the Netherlands.	$44.29	$7.109B	3.42%
Granite REIT (GRT.UN)	Offers geographic diversification with 144 properties spanning 5 countries. Focuses on industrial, warehouse, and logistics properties.	$69.18	4.213B	4.91%
H&R REIT(TSE:HR.UN)	One of Canada’s largest REITs. Has holdings in single and multi-tenant properties throughout Canada and the US.	$10.68	2.99B	5.62%
iShares S&P TSX Capped REIT Index ETF (TSX:XRE)	Has a long-standing reputation in Canada, and holds some of the top performing REITS in Canada (listed above!), such as Canadian Apartment Properties and RioCan Real Estate Investment Trust.	$15.72	N/A	5.53%
Vanguard FTSE Canadian Capped REIT Index ETF (VRE.TO; TSE.VRE)	Seeks to track the FTSE Canada All Cap Real Estate Capped 25% Index. Maintains 100% North American holdings, with the majority of them being in real estate services, retail REITs, residential REITs and office REITs.	$32.16	N/A	2.80%
SmartCentre REIT (TSX:SRU.UN)	SmartCentres is a Retail REIT, and ranks as one of Canada’s largest REITs. They have a strong and growing portfolio of over 196 mixed-use properties across the country.	$25.59	4.361B	7.23%
RioCan Real Estate (TSX:REI.UN	One of Canada’s largest real estate investment trusts with 177 properties, RioCan develops and operates retail-focused, mixed-use properties across the country in transit-connected urban neighbourhoods.	$17.71	5.264B	6.54%
CT REIT (TSX:CRT.UN)	CT REIT is primarily focused on the ownership and management of commercial properties across Canada. It is majority-owned by Canadian Tire Corporation (CTC).	$15.88	3.77B	5.97%

Again, these are just a few of the best Canadian REITs and REIT ETFs, but they offer great diversification, both geographically and in terms of the type of real estate holdings. It’s also great to note that there are a number of Canadian REITs that pay monthly dividends.

Allied Properties REIT (AP-UN.TO)

You’ll see Allied Properties pop up on many top Canadian REITs lists, and for good reason. Allied Properties is focused mainly on urban office spaces in major Canadian cities, namely Toronto and Montreal. The revenue comes primarily from tenant rental revenue.

When the 2020 pandemic had many people working from home, and the demand for office space dipped, some people became wary about investing in a REIT that is so heavily invested in office space. However, we see more and more companies mandating employees to return to the office, even if just part-time/in a hybrid role.

Also, many of Allied Properties’ top tenants are household names such as Google Canada Corp, Bell Canada, Telus Communications Inc., Shopify Inc.

Canadian Apartment Properties REIT (CAR.UN)

Canadian Apartment Properties REIT is the largest Canadian Residential REIT in Canada, and is well run. Not only do they have nearly 47,000 rental units, but they have some geographical diversification with having presence in multiple countries.

They have shown a growing occupancy rate, but there may be some minor limitations on growth in provinces with rent control – that is, slower growth potential when compared to non-residential sectors, as CAR.UN can not drastically raise rent prices, regardless of demand.

Granite REIT (GRT.UN)

Granite REIT is in the Industrial sector, active in the acquisition, development, ownership, and management of 144 warehouse and industrial properties across North America and Europe. 

With the increased demand for online shopping and rapid delivery, their warehouses should remain highly sought after. One concern that has been pointed out numerous times is Granite’s significant reliance on Magna International, which accounts for nearly 1/3rd of their rental revenue.

H&R REIT(TSE:HR.UN)

The H&R REIT is a diversified REIT with ownership interests in both Canada and the USA. The portfolio includes residential, industrial, office, and retail properties. While we are a fan of the diversification that this REIT offers, it may limit its overall growth when compared to other industries.

Inovalis Real Estate Investment Trust (TSX:INO.UN)

While Inovalis can give you international exposure with their offices in European cities, they are currently undergoing many changes. With only about half of their spaces currently being rented out, they have begun selling off some of their buildings to try and increase their unit prices. Time will tell what happens with Inovalis REIT!

iShares S&P TSX Capped REIT Index ETF (TSX:XRE)

Blackrock’s iShares S&P TSX Capped REIT is an Index ETF, meaning it holds a portfolio of many other REITs. It includes some of Canada’s largest, many listed here independently, such as Canadian Apartment Properties REIT, RioCan REIT, and Granite REIT.

The pro with an index ETF REIT is that it is already diversified for you, which makes things convenient. However, choosing an ETF REIT does not allow you to choose a specific type of real estate.

Vanguard FTSE Canadian Capped REIT Index ETF (VRE.TO; TSE.VRE)

The Vanguard FTSE Canadian Capped REIT Index ETF is another option offering you a diversified portfolio. While an index fund REIT is going to have a higher MER than the management fee for a REIT, this Vanguard REIT Index ETF comes at a lower cost than the iShares REIT Index Fund listed above (0.38% vs 0.61%).

Both of these REIT Index ETFs are weighted fairly heavily towards a select handful of REITs, so you may consider just purchasing those REITs individually.

SmartCentre REIT (TSX:SRU.UN)

SmartCentre is a retail-focused REIT with nearly 200 properties across the country. The majority of their revenue is from retail tenants (hello Walmart-anchored plazas!), but they have begun to diversify some of their properties to include apartments, as well as some smaller niche areas such as seniors’ housing and self-storage.

Riocan Real Estate (TSX:REI.UN)

While the focus of RioCan REIT is on retail, they have begun to diversify by stepping into the residential sector. Interestingly, RioCan has made a concentrated effort to base their 177 properties in dense urban areas accessible by public transit.

Many of these are anchored by grocery stores, and we know that everyone, everywhere, needs to eat! On the other hand, with online shopping growing, there may be some limits to how successful retail REITs are in the future.

CT REIT (TSX:CRT.UN)

The CT REIT primarily leases to the Canadian Tire Corporation. This is an advantage with Canadian Tire being a top-trusted and well-known company across the country, especially in 2025, with many consumers making a patriotic effort to support the national economy. This partnership, and the consistent growth of Canadian Tire, is a definite pro for this REIT.

What Are REITs

REITs, or Real Estate Investment Trusts, are companies that use investors’ funds to purchase and manage various kinds of real estate. They’re divided into Trust Units, which are available for trading on the stock market just like typical shares are. 

REITs allow Canadian investors to share in the income that the real estate generates without worrying about the practical difficulties that come with property management. Like other kinds of investments, Canadian REITs carry the possibility of capital gains if the value of the buildings and properties increases over time. 

Canadian REITs own many different types of properties. These include:

• Retail
• Office
• Hotel
• Industrial
• Diversified
• Healthcare (Including assisted living complexes)
• Retail (Apartments)

Types of REITs in Canada

There are many different ways to look at the types of REITs in Canada. They can be grouped by how they are bought/held/traded, how they make money, and by what type of real estate asset they hold.

To begin with, there are publicly-traded, public non-traded, and private non-traded REITs. These are categorized on how they are purchased or held by investors.

• Publicly traded REITs are readily accessible to general investors as they are traded on major stock exchanges, and you can buy them through a brokerage account. These publicly traded REITs are bought and sold as easily as other trading stocks. Because of this, they are subject to strict regulatory standards, which in turn promote transparency and investor protection. They have high liquidity and trading flexibility. Their accessibility and potential for consistent dividend income make them appealing to investors.
• Public non-traded REITs aren’t traded on stock exchanges. Unlike publicly traded REITs, they can be more difficult to liquidate and often come with higher transaction fees.
• Private non-traded REITs are not listed on public stock exchanges and are generally only available to accredited, eligible, or institutional (read: high net worth) investors. They usually require a higher minimum investment and are often less liquid than the publicly traded REITs. Despite these limitations, private REITs may offer benefits such as higher returns.

How do REITs make money? This question brings us to our next group of REIT categories, which are comprised of mortgage REITs, Equity REITs, and Hybrid REITs.

• Often referred to as mREITs, mortgage REITs provide financing by issuing loans, mortgages, or mortgage-backed securities (MBS), or by lending directly to real estate developers. The income is primarily based on the interest earned on these loans.

• Equity REITs own and manage income-producing real estate, such as apartment buildings, office spaces, and shopping centres. They generate revenue primarily by leasing these properties to tenants and collecting rent.

• Hybrid REITs combine features of both equity and mortgage REITs, offering a diversified approach to real estate investment. They generate income through rent from owning and managing commercial properties, like equity REITs, while also earning interest from mortgages and mortgage-backed securities, similar to mREITs. By blending these two strategies, hybrid REITs provide multiple revenue streams and help reduce the risks associated with investing in only one type of REIT.

There are many different types of REITs available in Canada based on the type of real estate asset. These REITs target different sectors of the real estate market. It is important for investors to gain an understanding of these categories so that they can select REITs that best match their financial objectives and risk level. 

Some of the most common categories of TSX-listed REITs are Retail (shopping centers, malls, etc.) and Residential (apartments and multi-family rental properties). Industrial is another sizeable category, including warehouses and distribution centers.

TSX-listed REITs can also include Office (commercial office buildings) and Healthcare (hospitals, nursing homes, medical offices). Less common REITs may exist in the domains of Hospitality (hotels) or Specialty (self-storage, timber, etc.)

How to Buy REITs in Canada

Buying REITs is easy as buying anything else through your online brokerage. You can buy an ETF that holds a diversified basket of REITs from various categories. You can also choose to hand-pick a few individual REITs if you want to focus on a certain type of asset (and don’t mind doing some careful market research).

If you don’t have a brokerage account yet, I recommend reading our Qtrade review. Qtrade is currently ranked as our #1 Canadian broker and offers $150 cash back for new accounts.

Risks and Benefits of REITs

Like any investment, there are risks and benefits to investing in Canadian REITs. We’ll start with some pros and cons and then look at the risks that are specific to REITs. 

Pros To Investing in REITs:

Easy to Buy and Sell: No mortgage approval needed, no time in escrow, and no home inspections. Just buy the REIT units through your usual investment brokerage.

Easy Diversification: REITs are considered as a distinct asset class, so adding them to your portfolio can be a great way to diversify your investments. 

Low Maintenance: Invest in real estate without having to call a repairman or deal with irate tenants. Management is taken care of and REIT holders reap the rewards with distributions of up to 90% of the REIT’s income.

No Down Payment Necessary: Property values have been skyrocketing and down payments are painfully high—but a REIT lets you invest in real estate without waiting to accumulate a large amount of cash.

Cons To Investing in REITs:

Possible Taxation: REITs aren’t subject to corporate taxation, which means that the tax burden is passed on to the investors. We’ll get into this more in a minute, but in a nutshell, this can lead to complicated tax situations. (For this reason, we recommend holding your REITs in registered accounts such as TFSAs or RRSPs, where taxes are deferred or exempted.)

Limited Leverage Ability: Purchasing an investment property with a mortgage allows you to maximize leverage (i.e. use a minimum of your own cash and have the remainder of the cost covered by a lender). While investors do have some leverage ability, the fact is that lenders are less willing to lend large amounts of capital to investors than to property buyers. They’ll also charge more interest on lines of credit and investment loans than on mortgages.

REITs rise and fall in value depending on real estate values, which can be a good thing – or a risky one. On the one hand, REITs can offer a buffer against inflation – for example, if other areas of the stock market are falling and property values are rising. 

However, it’s a double-edged sword – if real estate values tumble, the value of REITs will follow. This was particularly damaging during the real estate crash in 2007-9 and during lockdown in 2020 when hotels and tourist-dependent properties were hit particularly hard. 

How to Evaluate a REIT

Most REITs are equity REITs. This means that they make the majority of their income from rent, interest on mortgages, or sales of properties.

REITs must pay out a minimum of 90% of their taxable income in shareholder distributions each year. In exchange, REITs pay no corporate taxes. This is crucial to understand, since the tax liability for these earnings will fall to you when you invest in Canadian REITs.

Basically, all of this means that we can’t use the typical earnings per share and dividend payout ratios to gauge the financial health of a REIT. 

Instead we use the Funds From Operations and Adjusted Funds From Operations (FFO & AFFO for short). to analyze a REIT’s financial health and growth potential. Those two metrics replace the earnings and adjusted earnings that we would use for a traditional stock. 

While the metrics are different, the focus is the same: it’s all about cash flow and the REITs’ ability to sustain and increase their dividend payments. The FFO reflects the REIT’s income, taking depreciation and property gains into account. The AFFO is adjusted (hence the name) to factor the costs of property maintenance and improvements into the equation. If you want more information, here’s a good primer on FFO. 

It is important to consider not just the (A)FFO but also the (A)FFO per unit of ownership. One of the REITs’ favorite methods to finance their new projects is to issue more units. We need to make sure that this isn’t happening excessively, because it dilutes the value of the units that you hold as a current investor in the REIT.

More units means more shareholders, and that reduces your share ownership of the entire operation. And then there are more shareholders in line for those dividends.

There are simply more mouths to feed!

Investors in Canadian REITs should keep an eye on the free cash flow generated by any new properties, and then the total free cash flows per unit. If the FFO per unit drops, that may signal that the REIT may have difficulty increasing or maintaining its dividend – and that means less money for you!

To get a good sense of whether a REIT is worth considering, look at the (A)FFO as well as growth rates, the REIT’s dividend history, and its debt ratios. This information is generally easy to find online.

How are REITs Taxed?

If you’re adding REITs to your portfolio, your best bet is to keep them in registered accounts such as RRSPs, TFSAs, or RRIFs. And that’s because Canadian REITs are taxed differently than other assets, and it can get complicated.

While ordinary dividends from Canadian bank stocks or Canadian Telco stocks qualify for the dividend tax credit, REIT distributions come from many sources and each source can receive a different tax treatment. 

Related post: Best Canadian Dividend Stocks for 2025. 

The REIT distributions are usually in portions of eligible dividends, capital gains, return of capital, foreign income and other income. 

Dividends are reported on a T5 form while distributions are reported on a T3 form. Your T3 form will break down the various forms of income.  

Given all of the tax reporting and tracking complexities you can see why holding REITs in a registered account is advisable. These accounts grow tax free, so there’s nothing to track. 

That said, REITs can also be quite tax efficient for taxable accounts. If you’re comfortable with tax documentation, or if you work with an accountant, it can be worth it.

Canadian REIT Recommendations

When it comes to researching the best REITs and understanding how the unique REIT cashflow model holds up versus traditional Canadian dividend champions like Fortis or RBC, our primary source of information is the Dividend Stocks Rocks (DSR) Platform.  

Mike Heroux (the man behind DSR) has been writing about Real Estate Investment Trusts since they were first invented.  Click here to see what DSR is all about and to take advantage of our exclusive MDJ lifetime discount.

What About Rising Interest Rates? 

As the economy recovers from the shutdowns of 2020, rising interest rates across North America are causing some potential investors to question whether REITs are a smart investment in today’s economic climate. The good news is that historically, REIT investors are well positioned to weather climbing interest rates. 

According to a recent report from global investment manager, Cohen and Steers, REITs respond to the direction of the economy, job growth, and rental prices, rather than to interest rate hikes. In an economy with low unemployment and rising rental fees, Canadian REIT investors are in a good position. 

Real estate sectors can also provide a buffer to inflation, particularly in the case of short-term leasing businesses like self-storage, where rental rates can be reset more often. In the name of diversification we want assets that don’t always move together. We want some zig to go with that zag. It’s about portfolio teamwork.

While this study is based on US REITs, Canadian REITs share similar performance characteristics, and have been known to outperform their US counterparts. In fact, LiveWire (a well-respected Australian site for investment analysis) recommends Canadian REITs because of their focus on income and their good performance compared to other REIT markets. 

You can read more in their analysis of REIT opportunities in Canada, or see the chart below (information from the aforementioned article) for a quick view of how Canadian REITs compare.

	Forward Earnings Multiple	Price/Net Assets Value	Dividend Yield
Canadian REITs	15.1x	0.99x	4.6%
US REITs	19.1x	1.17x	3.5%
Global REITs	19.5x	1.11x	3.6%

It’s easy to get caught up in doom-scrolling through financial news, but top analysts are optimistic about REIT investing in 2025, and particularly REITs in Canada. And while no one can tell the future 100%, it’s still comforting.  

Canadian REITs vs Real Estate Stocks

So far we’ve discussed the benefits of investing in Canadian REITs in comparison to buying property yourself, but there’s a third option that’s worth looking into: real estate stocks. 

Unlike REITs, which function as trusts, real estate stocks are your basic stocks. They just happen to be tied to businesses (typically lenders) that operate in the real estate sector. 

While some real estate stocks pay dividends, they’re taxed and treated the same as any typical investment earnings. You can get more details and some specific recommendations for real estate stocks in our list of the Best Real Estate Stocks in Canada for 2025.

Investing in Canadian REIT ETFs

Now that we’ve covered some of the best Canadian REITs to buy and taken a quick peek at real estate stocks, it’s time to explore REIT ETFs.

As we mentioned earlier, you can pick and choose your favourite Canadian REITs. And while that’s a valid choice, and can certainly pay off, it does mean you’ll need to pay more attention to how that particular sector of real estate is performing (think hotels in 2020, for example).

We’ve already discussed how REITs don’t respond to economic changes in the same way that stocks do, and how performance history indicates that they’ll likely be fine in the longterm, but another way to help manage your risk and keep things more balanced (while saving yourself from doing hours of research about, say, the state of the retail property market) is to invest in REIT ETFs.

REIT ETFs, just like any other ETF, offer buyers a way to passively invest in a large range of real estate holdings without having to worry about doing a lot of due diligence on individual REITs.

When it comes to investing in Canadian REITs, I like looking to ETFs and fund managers that I trust. On my site I covered the CI First Asset REIT, ticker RIT. CI First Asset REIT is a very good one-stop ETF option for Canadians: it features a diversified portfolio of residential, industrial, and seniors housing real estate, it’s actively managed, and it’s one of Canada’s top performing REIT ETFs.

Qtrade allows you to buy and sell CI First Asset Canadian REIT units for free, which is a definite plus, both for this ETF and for Qtrade. 

There are a number of other cost effective Canadian and US REIT ETFs available to Canadians listed on the Toronto Stock Exchange.

The most popular REIT ETFs besides the CI First Asset REIT ETF include:

• CI First Asset Canadian REIT ETF (RIT)
• BMO Equal Weight REITs Index ETF (ZRE)
• iShares S&P TSX Capped REIT INDEX ETF (XRE)
• Vanguard FTSE Canada Capped REIT Index ETF (VRE)
• Purpose Real Estate Income ETF (PHR)

There is a lot more to explore on the topic of REIT ETFs. If you would still like to learn more, as well as find out whether REITs or REIT ETFs are right for you, check out our other article about the best Canadian REIT ETFs. We’ll take a closer look at some of our top recommendations for each option.

Luckily, no matter which option you choose, it’s easy to purchase REITs and REIT ETFs in Canada. We recommend Qtrade and Questrade as the best low-cost and reliable platforms for all of your investment needs.

Investing in Canadian REITs – FAQ

Final Thoughts on Canadian REITs

Canadian REITs offer a smart, low-stress way to diversify your portfolio with real estate—without the hassle and commitment of becoming a landlord. They provide access to professionally managed real estate assets and typically pay out monthly dividends, giving you the opportunity to earn consistent passive income.

Many financial advisors recommend allocating around 10% of your portfolio to REITs. We agree—it’s a solid strategy for adding diversification and helping protect your investments from stock market volatility and inflation.

If you’re looking for a simple, hands-off way to tap into the real estate market, Canadian REITs and REIT ETFs are a great place to start.