I Just Added This High Yield Dividend Holding To My Portfolio

After the abrupt news came out in September that W.P. Carey would be unloading all of their office properties, I was so fed up with their change in direction that I made the decision to sell all of my shares of WPC. There were a few reasons why I decided to exit my position at my second favorite real estate investment trust, and I made a video dedicated to my reasoning. But to quickly summarize, this decision to unload their office properties would come at the cost of their newly crowned dividend aristocrat status. I relied on this stock to provide me with long-term dividend growth, and with a chunk of their properties now gone, their dividend was going to take a hit from having a smaller portfolio. Second, their timing and reasoning for making this move didn’t make sense to me.

According to their numbers, everything appeared to be going fine. W.P. Carey has always had a very high occupancy rating, so there didn’t seem to be any issues with their office properties. I’ve speculated that maybe there was something going wrong behind the scenes that investors like myself weren’t aware of, but we don’t know if that’s the case. The timing for this was also poor, in my opinion, as office properties and the CRE market have been struggling for some time. In my opinion, getting out of office properties earlier would have been a better move. But even more ideally, I think would’ve been to gradually sell their office real estate over time. The company has been saying for years that their properties are of high quality, so if that were true, then they shouldn’t need to sell them at a discount.

We’ve seen it happen before where other REITs will spin off some of their properties into a new REIT, like what Realty Income did, and it almost never works out for investors. Ultimately, I think what WPC did will work out for them in the long term. But I just wasn’t willing to wait a long time for their dividend and share price to recover, which could potentially be years, considering their dividend growth has been significantly slow for a long time. So with that in mind, I sold all of my shares and decided to now look for a stock to replace it in my portfolio. Because I relied on W.P. Carey for long-term dividend growth, I wanted a stock that would provide me with that same performance, hopefully with a calmer board of directors. After spending a couple months in search of a replacement and looking at different options, I recently announced on our Patreon that I had come to a decision.

https://www.patreon.com/dividendbull

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