Real Estate

A real estate bet that comes with a 10 per cent yield is worth a look

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Pedestrians and office workers walk past the Bay St. entrance to Brookfield Place in Toronto’s Financial District on July 12, 2022.Fred Lum/the Globe and Mail

Real estate companies with exposure to office buildings are struggling amid high vacancy rates and an uncertain future as many people continue to work from home.

If buying the beaten-up units of real estate investment trusts at the depths of despair sounds too risky, here’s another approach: Take a look at the preferred shares of Brookfield Property Partners, which can yield more than 10 per cent right now – signaling risk, but a compelling opportunity too.

Preferred shares are fixed-income securities that are issued at a par price, generally $25, and pay a set quarterly distribution in the case of fixed-rate shares.

Yes, they still reflect uncertainty in the office market. And full disclosure: I own a particular issue

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