O — Realty Income Corporation
Net Lease REITs · Founded 1969 · San Diego, California · CEO: Sumit Roy
Realty Income is one of the largest and most recognized real estate investment trusts (REITs) in the United States, known as 'The Monthly Dividend Company' for its consistent monthly dividend payments. The company owns over 15,000 commercial properties net-leased to tenants including Walgreens, Dollar General, 7-Eleven, Dollar Tree, and FedEx. Net leases require tenants to pay property taxes, insurance, and maintenance in addition to base rent, minimizing Realty Income's operating expense obligations. Realty Income's scale, diversification, and dividend consistency make it one of the most widely held REITs.
How Realty Income Corporation Makes Money
Net lease rental income on retail, industrial, and specialty properties across the U.S. and Europe
Contractual rent escalations (typically 1-2% annually) embedded in lease agreements
Accretive property acquisitions adding to total net lease income
European expansion providing currency-diversified net lease income
Key Metrics Investors Watch
- Adjusted funds from operations (AFFO) per share — the REIT equivalent of earnings per share
- Dividend per share growth and AFFO payout ratio
- Portfolio occupancy rate (historically above 98%)
- Investment spread (cap rate on acquisitions vs. cost of capital)
- Same-store rent growth
Competitive Advantages
- Scale at 15,000+ properties provides diversification across tenants, geographies, and industries
- S&P 500 Dividend Aristocrat with 25+ years of consecutive dividend increases paid monthly
- Investment-grade balance sheet enables low-cost capital access for accretive acquisitions
- Essential retail tenants (convenience stores, pharmacies, dollar stores) provide defensive income
Key Risks
- Rising interest rates compress REIT valuations and increase cost of capital for new acquisitions
- Tenant credit risk — major tenant bankruptcies could reduce occupancy and income
- Retail real estate secular headwinds from e-commerce disintermediation of tenants
- Dividend growth pace is modest (typically 3-5% per year), limited by net lease economics
Dividend & Capital Return
Realty Income is famous as 'The Monthly Dividend Company,' paying monthly dividends for over 600 consecutive months and achieving Dividend Aristocrat status with 25+ consecutive years of annual dividend increases.
I Document Every Trade — Even the Losses
Options record: 1W-8L. Net worth: 100% GSE preferred. Get the unfiltered updates.
Unsubscribe anytime. I respect your inbox more than Congress respects property rights.
Frequently Asked Questions
What is a net lease REIT?
A net lease REIT owns commercial properties where tenants pay base rent plus property taxes, insurance, and maintenance costs (the 'nets'). This structure minimizes the landlord's operating expenses and creates very predictable, low-maintenance income streams. Realty Income is the largest net lease REIT. This is educational content, not financial advice.
Why does Realty Income pay monthly dividends?
Realty Income chose to pay monthly dividends as a brand differentiator, aligning its income distributions with the typical monthly financial obligations of investors. The company has paid monthly dividends for over 50 years and has trademarked 'The Monthly Dividend Company.' This is educational content, not financial advice.
Is Realty Income a Dividend Aristocrat?
Yes, Realty Income has increased its dividend for over 25 consecutive years, qualifying it as a Dividend Aristocrat. Given its monthly dividend cadence, it has actually made many more consecutive individual payments than annual increases. This is educational content, not financial advice.
What tenants does Realty Income lease to?
Realty Income's largest tenants include Walgreens, Dollar General, Dollar Tree/Family Dollar, 7-Eleven, FedEx, CVS, and Walmart. These essential retail and logistics operators provide stable, long-term lease income. This is educational content, not financial advice.
Is Realty Income a good income investment?
Realty Income is widely considered a high-quality income investment due to its diversified net lease portfolio, essential tenant base, Dividend Aristocrat status, and monthly income payments. Rising interest rates are the primary risk as they both increase borrowing costs and make alternative income investments more competitive. This is educational content, not financial advice.
Related Stocks
Recommended Resources
Tools & books I actually use and recommend
SeekingAlpha Premium
Quant ratings, earnings transcripts, and the stock analysis community where I published 300+ articles.
Try SeekingAlphaThe Intelligent Investor
Ben Graham's timeless guide to value investing. The book Warren Buffett calls "the best investing book ever written."
View on AmazonInteractive Brokers
Low commissions, global market access, and professional-grade tools. This is where I hold my positions.
Open an AccountSome links above are affiliate links. I only recommend products I personally use. See my full disclosures.
Keep Exploring
All Stocks
Browse all 134 stock profiles by sector.
Read moreGuideBest Stocks For Beginners
Curated stock picks for new investors by goal.
Read moreReferenceFinancial Glossary
Understand the terms investors use every day.
Read moreCompareStock vs ETF
Individual stocks vs ETFs — which is right for you?
Read moreETFsETF Profiles
Deep dives on 90+ ETFs across every category.
Read moreGuideBuying Your First Stock
How to open a brokerage and buy your first share.
Read moreCompany information is based on publicly available disclosures and widely-known business facts. No specific price, earnings, or real-time market data is included. This is educational content — not investment advice.