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A Safe 7.2% Preferred Dividend From Global Net Lease


  • Global Net Lease owns a well-diversified portfolio with an average remaining lease term of nine years, and a large base of investment grade tenants.
  • While we consider the common shares attractive with its 13% yield, we see elevated risk due to a possible dividend cut which could lead to more downside.
  • GNL's Preferred Stock offers a safe 7.2% yield that is very well covered and backed by quality real estate, and is very attractive in today’s marketplace with few opportunities left.
  • The margin of safety for the preferred holder is high. Any potential cut will affect common holders, but would lead to an even higher coverage for the preferred stocks.
  • The Preferred stock, GNL-A, trades at around its par value of $25/share and provides a safe and generous income for high-yield seekers.

This research report was jointly produced with High Dividend Opportunities co-author Jussi Askola.

Global real estate is an asset class that provides solid diversification benefits and can help improve the risk adjusted returns of a portfolio. Yet, only few investors ever invest in this asset due to the lack of opportunities easily accessible to U.S. individual investors.

In this sense, Global Net Lease (NYSE:GNL) is one of the only U.S. REIT, along with W.P. Carey (WPC) and NorthStar Europe (NRE), to allocate a significant portion of its portfolio into global real estate, or Europe to be more specific.

By investing in these shares, investors are able to gain exposure to foreign real estate in a liquid, diversified and cost-efficient manner. No need to trade shares on a foreign stock exchange and no withholding tax… We find this to be a simple and favorable way to gain a desirable market exposure.

Having looked at the different alternatives including common stock, debt, and preferred, we identify one specific security that we believe will continue to pay generous dividends for many years just like clockwork.

Global Net Lease

Global Net Lease is a U.S. REIT with a market cap of $1.2 billion that is focused on the generation of stable and predictable income through rents from its real estate portfolio.

The current portfolio contains many different property types with a great concentration on single tenant office properties. The 313 properties are located in diverse markets throughout the U.S. (49%) and Europe (51%).

Overall, we think that this particular portfolio has a good mix of positives and negatives. It is far from being perfectly risk-free.

The main positives are the following:

Positive 1: The tenants are strong with 75.8% of implied investment grade tenants. Well-known tenants include FedEx (FDX), Dollar General (

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This article was written by

Rida Morwa profile picture
The #1 Service for Income Investors and Retirees, +9% dividend yield.

I am a former Investment and Commercial Banker with over 35 years of experience in the field. I have been advising both individuals and institutional clients on high-yield investment strategies since 1991. I am the lead analyst at High Dividend Opportunities, the #1 service on Seeking Alpha for 6 years running.

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