3 High-Yield REITs to Hedge Volatility and Capture Long-Term Growth in 2026

In an era marked by macroeconomic uncertainty and shifting market dynamics, strategic income diversification has become a cornerstone of resilient investment portfolios. Real estate investment trusts (REITs) offer a compelling avenue to balance risk while capitalizing on structural trends. For 2026, three REITs stand out as particularly attractive: Digital Realty Trust (DLR), Welltower (WELL), and Rexford Industrial Realty (REXR). Each is positioned to leverage sector-specific tailwinds-AI infrastructure demand, demographic-driven healthcare growth, and industrial real estate resilience-while delivering stable yields and long-term value.

1. Digital Realty Trust (DLR): Capitalizing on the AI Infrastructure Boom

The surge in artificial intelligence (AI) adoption is reshaping global infrastructure demand, and Digital Realty Trust is at the forefront of this transformation. According to a Bloomberg report, more than half of DLR's recent lease bookings are tied to AI-related workloads, reflecting the company's strategic alignment with this structural shift. With AI spending projected to reach $600 billion in 2026, DLR's role as a provider of high-performance data centers is critical.

The company's financial strength is underscored by a $852 million backlog of signed-but-not-commenced leases, ensuring multiyear cash flow visibility. Strategic partnerships, such as its joint venture with Reliance Industries and Brookfield Corporation, further expand its capacity to meet global demand. Additionally, DLR's $373 million power equipment agreement with Schneider Electric highlights its proactive approach to scaling infrastructure. Analysts project mid-single-digit FFO growth annually through 2029, driven by its carrier-neutral connectivity model and sustainability initiatives. For investors seeking exposure to a high-growth sector with durable cash flows, DLR offers a compelling case.

2. Welltower (WELL): Leveraging Demographic Shifts in Healthcare

The aging global population is fueling a surge in demand for healthcare and senior housing services, positioning Welltower as a beneficiary of this demographic-driven trend. A Reuters analysis notes that WELL's RevPOR (revenue per occupied unit) is expected to grow steadily through 2026, supported by its premium portfolio of senior housing properties and strategic acquisitions. In Q3 2025, the company reported a 20.7% year-over-year increase in normalized FFO per share, reflecting strong operational performance.

Welltower's disciplined capital allocation strategies and diversified portfolio provide a buffer against sector-specific risks. For instance, its focus on medical office buildings and skilled nursing facilities aligns with the rising need for integrated healthcare services. As life expectancy increases and healthcare costs rise, WELL's assets are likely to retain their value while generating consistent income. This makes it an attractive option for investors seeking to hedge against macroeconomic volatility with a sector poised for long-term growth.

3. Rexford Industrial Realty (REXR): A Buy-the-Dip Opportunity in Industrial Real Estate

Industrial real estate remains a resilient asset class, driven by e-commerce expansion and the demand for modern logistics facilities. Rexford Industrial Realty (REXR) has demonstrated robust performance in this space, with Q3 2025 results showing a 26.1% increase in net effective rental rates on new and renewal leases. Its 96.8% occupancy rate in the Same Property Portfolio underscores the sector's strength.

Despite its solid fundamentals, REXR's stock has dipped to $41.65-nearly 10% below its 52-week high-creating a potential entry point for value-oriented investors. A discounted cash flow analysis suggests the stock is undervalued by 24.5%, with an intrinsic value of $53.67 per share. The company's low Net Debt to Enterprise Value ratio (23.2%) and disciplined share repurchase program further enhance its appeal. While analysts remain divided, with a consensus "Hold" rating, the long-term outlook for industrial real estate-driven by supply chain reconfiguration and tech-enabled logistics-supports REXR as a buy-the-dip candidate.

Conclusion: A Diversified Approach to 2026

The three REITs highlighted above exemplify how strategic income diversification can mitigate volatility while capturing growth in key sectors. Digital Realty Trust's alignment with AI infrastructure, Welltower's demographic-driven healthcare focus, and Rexford Industrial Realty's undervalued industrial real estate exposure collectively address both cyclical and structural trends. As 2026 unfolds, these REITs offer a balanced mix of yield, stability, and long-term value creation-a critical combination in an uncertain market environment.