These 4 REITs Pay Up to 8.3% a Year and Trade Near Their Yearly Lows. Is It a Gift or a Trap?

Landlords of Las Vegas casinos, multiplexes, and retail stores pay 6 to 8.3% a year, and all four have raised their dividends this year. The U.S. Treasury pays 5.15%. One of their biggest tenants is now being sold along with $11.9 billion in debt.

The Treasury pays 5%, these companies pay 8%. The difference is the price of fear

The 10-year U.S. Treasury bond is paying the most in more than a year. On Friday, November 13, its yield closed at 5.15%, a full percentage point higher than a year ago, and the market is treating a December Fed rate hike as almost certain. Every dividend stock is now competing with a security that cannot go bankrupt.

Four landlords of casinos, cinemas, and retail stores pay 6 to 8% a year. All have raised their dividends this year and all report record rents. Yet three of them are 18 to 21% below their yearly highs, and the market values them as if their tenants were about to stop paying.

The last column is the key to the entire article. The premium over Treasury bonds is what the market charges for the risk that a tenant might one day fail to pay. For cinemas and retail stores, it's less than one percentage point, meaning the market is penalizing them only for expensive money. For the two casino landlords, it's two to three times higher, and that fear has the name and face of a specific tenant.

VICI: its biggest tenant is for sale along with its debts

VICI Properties $VICI owns the land beneath Caesars Palace, MGM Grand, and The Venetian in Las Vegas. The stock is down -17,6 % over the past year, while the S&P 500 index has gained 12,3 %. Meanwhile, the company raised its dividend for the ninth consecutive time in September, to 0,46 USD quarterly, which at a price of 25,01 USD gives an annual yield of 7,4 %. It raised its full-year estimate of funds from operations (AFFO) to 2,47 to 2,48 USD per share, of which the dividend takes only about 74 %.

The fear has a name: Caesars Entertainment. It accounts for 38 % of VICI's rent and has been for sale since May: billionaire Tilman Fertitta is buying it for 17,6 billion USD, including 11,9 billion in assumed debt. The Federal Trade Commission (FTC) requested additional materials in September, and no one knows what the new owner will do with the regional lease, which runs through 2055.

In the third quarter, VICI recorded impairment charges of 458 million USD, more than 300 million of that related to the Caesars contract, and earnings per share fell from 0,71 to 0,31 USD, a drop of 56 %. This is a non-cash item; rent is still coming in full. Management responded with the company's first-ever share buyback, of up to 2 billion USD. Its P/E of 11,6 is well below the five-year average of 15,5, and the analyst consensus of 28,40 USD is 14 % above the share price.

"While I am very proud of the work the VICI team did during the third quarter of 2026 to improve the quality and profitability of our portfolio, as a fellow VICI shareholder I am disappointed with the stock's performance during the quarter and year to date."

Edward Pitoniak, CEO of VICI Properties

GLPI: a tenant that questions its own viability in its filings

Gaming and Leisure Properties $GLPI leases regional casinos outside Las Vegas. Its quarterly dividend of 0,82 USD means 3,28 USD a year, and at a price of 39,34 USD, a yield of 8,3 %, the highest of the four. At the end of September, when the stock fell to its lowest level in three years, the company itself calculated its yield at 8,6 %. A year earlier the same stock yielded 6,7 %, and at midyear it yielded 7,4 %: the yield rose mainly because the price fell.

Meanwhile, business is showing no signs of slowing. AFFO grew 10,5 % in the third quarter, the full-year estimate is 4,11 to 4,12 USD per share, and the dividend takes about 80 % of that. The stock is 21 % below its high for another reason: tenant Bally's, which accounts for roughly a fifth of GLPI's cash revenue, added a going-concern warning to its filing. GLPI is also financing Bally's casino construction in Chicago; it has already advanced 641 million USD of its 940 million USD commitment, with opening planned for the first half of 2027.

Management said on the conference call that rents on Bally's properties are covered roughly two times over, and that it has other interested parties lined up for Chicago.

"I would note that despite volatility in the debt and equity markets, our tenants' operations and our business remain stable, as demonstrated by the growth in our AFFO, which again exceeded 10 % in the third quarter."

Peter Carlino, Chairman and CEO of Gaming and Leisure Properties

Cinemas and retail stores: two companies where fear has no name

EPR Properties $EPR is the exception in the group. It leases multiplexes, ski resorts, and amusement parks, and is up +17,3 % over the past year, just 7 % below its high. It raised its monthly dividend to 0,31 USD, or 3,72 USD a year (+5,1 %), for a yield of 6,2 %. Cinemas are helping: U.S. box office revenue is up a fifth from last year so far, the highest level since 2019. The AMC and Regal chains account for 24 % of EPR's revenue, so the company is betting on the movie calendar. But the stock is already above Bulios' fair value of 54,59 USD, and a good year at the cinemas may not be repeated.

"Rent coverage across our portfolio increased slightly during the quarter to 2.1 times. We are also pleased that box office revenues are running well ahead of last year."

Greg Silvers, Chairman and CEO of EPR Properties

National Retail Properties $NNN is the dullest and steadiest of the four. It owns 3 774 convenience stores, retail stores, and restaurants, with 99 % occupancy and no dominant tenant. Its quarterly dividend of 0,62 USD (2,48 USD a year, a 6,0 % yield) has grown for 37 consecutive years and takes only 68 % of rental cash flow. Its 119 % payout ratio based on accounting earnings looks frightening, but that's a common distortion for real estate funds, which account for depreciation on buildings that aren't actually losing value.

Yet the stock is 18 % below its June high of 50 USD and has lost 10,8 % since summer. The reason is purely interest-rate related: in December, NNN will refinance 350 million USD in bonds, and the new financing will cost it about 5,5 % instead of just under 4 %. Every rate hike eats into its margin, not its rent.

What will determine which yield was a gift and which was a trap

At all four companies, rental cash flow covers the dividend with room to spare. The difference lies in what the market is charging the premium over Treasury bonds for. For EPR and NNN, it's less than one percentage point and reflects the cost of expensive money. For VICI and GLPI, it's 2 to 3 points and reflects the risk of one specific tenant.

Signals to watch:

• December 10, Fed meeting: the market expects a rate hike. As long as the 10-year Treasury bond stays above 5 %, the prices of all four stocks will remain under pressure, regardless of their tenants

• Caesars and Fertitta: decisions by the FTC and gaming regulators; the transaction is due to close by June 26, 2027. Any mention by VICI of changes to the regional lease is a signal that 38 % of its rent is being renegotiated

• Bally's: further filings with going-concern warnings and the opening of Chicago in the first half of 2027. A delay would leave GLPI with an unfinished building, turning 8,3 % from a reward into a warning

• Cinemas and interest rates: EPR's 2027 movie calendar and NNN's December refinancing costs

Results are due in February: NNN on February 10, GLPI on February 18, and VICI and EPR on February 24, 2027. Until then, Treasury bonds will determine the prices of all four. For cinemas and retail stores, that's the whole story. For casinos, it's only the first half.