NREF - 14% Dividend Yield From KKR Real Estate Finance: Too Good To Be True?

2024-07-15 07:45:00 ET

Summary

• Mortgage REITs are very cheap.
• So cheap in fact that they now offer 10%+ dividend yields.
• KKR Real Estate Finance is the cheapest, offering a 14% dividend yield and a steep discount to its book value. Is this an opportunity?

Co-produced by Austin Rogers

About a year ago, we performed a broad analysis of commercial mortgage REITs to see if we could find any compelling value.

While the spread-based business model of residential mREITs is unappealing to us and has resulted in poor long-term returns, commercial property mREITs have better records, to varying degrees....

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