I'm about to get a big cash infusion in my portfolio. Last year, private equity giant Blackstone agreed to buy one of my holdings, Retail Opportunity Investments Corp., in an all-cash deal. That transaction should close soon.
As a result of that sale, I'll lose the dividend income that the real estate investment trust (REIT) produced. That's why I plan to quickly redeploy that cash across several other income-generating investments. Among the dividend stocks I can't wait to buy are Vici Properties (NYSE: VICI), Medtronic (NYSE: MDT), and Enbridge (NYSE: ENB). This trio of higher-yielding dividend stocks will enable me to generate more passive income each year than I was collecting from Retail Opportunity Investments Corp., which is why I can't wait to buy them.
Vici Properties is a REIT focused on experiential real estate, like gaming, hospitality, and entertainment destinations. It owns several iconic properties, including Caesars Palace Las Vegas and the Venetian Las Vegas. It leases these and other properties to operating tenants under long-term triple net leases (NNN). Those leases provide it with very stable rental income because its tenants cover all operating costs, including routine maintenance, building insurance, and real estate taxes. Meanwhile, a growing percentage of its leases escalate rents at rates tied to inflation. The figure stood at 40% last year and will rise to 90% by 2035. As a result, its rental income grows each year.
The REIT pays out about 75% of its stable income through a dividend that currently yields 5.8%, several times higher than the S&P 500's 1.2% dividend yield. It retains the rest to help fund new income-generating property investments. Vici also has an investment-grade balance sheet, giving it additional financial flexibility to continue investing in new experiential properties.
Vici Properties has steadily expanded its portfolio, which has allowed it to increase its high-yielding dividend. It has raised its payout in all seven years since its formation, growing it at a peer-leading 7% compound annual rate. It has lots of ways to continue growing, including acquisitions, funding expansion projects at its existing properties, and providing financing to experiential property developers. Continued new investments and rent growth should enable the REIT to keep increasing its dividend and supplying me with more passive income.
Medtronic pays a high-yielding dividend, currently at 3.1% and steadily rising. The medical technology giant has increased its payout for 47 straight years. It has grown its dividend at an impressive 16% compound annual rate during that period.