Invest $10,000 in This Dividend Stock for $566 in Passive Income

A $10,000 Tax-Free Savings Account (TFSA) won’t buy instant freedom, but it can start a real passive-income habit. The goal is to own something that can keep paying through boring years and ugly years, not just the fun ones. When distributions arrive, you can reinvest them and slowly increase your unit count without lifting a finger. Over time, that snowball effect can matter more than the first month’s payout. The key is picking a payout that looks covered by cash flow and a business model that can adapt. So, let’s look at one dividend stock offering that.

PMZ

Primaris Real Estate Investment Trust (TSX:PMZ.UN) is a Canadian enclosed shopping-centre real estate investment trust (REIT) that pays monthly distributions. It’s the opposite of a hype stock. You’re buying rent from tenants in malls, plus management’s ability to keep space leased and push rents over time.

If the Bank of Canada signals multiple cuts, REITs can get a lift as income assets often look more attractive when yields are falling, and refinancing worries ease a bit. But you can’t invest in PMZ.UN based only on rate hopes. The unit price can swing on every macro headline. What matters is whether the centres keep generating cash, and whether vacant space is getting re-leased at decent economics.

Into earnings

Primaris’s third-quarter (Q3) 2025 release showed both progress and one very real mess to clean up. Total rental revenue was $159.2 million, and management said it already reflected a $2 million negative impact tied to Hudson’s Bay Company issues. Same-properties cash net operating income (NOI) rose 0.7% year over year, and Primaris explained that underlying growth looked stronger once adjusting for a one-time operating cost accrual and the impact from disclaimed HBC locations.

For REIT investors, funds from operations (FFO) is the cash-flow lens that usually matters most. Primaris reported FFO per unit fully diluted of $0.443, up 5.7% from the prior year, and it put the FFO payout ratio at 52.6%. That’s a meaningful buffer, as it suggests the distribution isn’t being stretched to the limit. Primaris also reiterated 2025 guidance for same-properties cash NOI growth of 4% to 5% and FFO per unit fully diluted of $1.78 to $1.82. Therefore, it’s still pointing to a steadier full-year picture.

Earning income

Valuation is where PMZ.UN can start to feel comfortable for a beginner who wants income without paying a premium. Primaris reported net asset value (NAV) per unit of $21.58 as of Sept. 30, 2025, and management highlighted unit buybacks at what it called a deep discount to NAV. Primaris also announced a distribution increase from $0.86 to $0.88 per unit annually.

So, can $10,000 actually supplement your income? After the increase to $0.88, it’s looking like a strong option, assuming your unit count stays the same. It won’t replace a paycheque, but it’s a real monthly stream you can reinvest, stack with other TFSA holdings, and grow as you add contributions. Here’s what it might look like on the TSX today.

COMPANYRECENT PRICENUMBER OF SHARESDIVIDENDANNUAL TOTAL PAYOUTFREQUENCYTOTAL INVESTMENTPMZ.UN$15.52644$0.88$566.72Monthly$9,994.88

Bottom line

The lifetime test is staying power. Primaris shows enough cash cushion to keep paying while it works through vacancies, but the risk is clear. Management updated 2025 occupancy guidance to 85% to 87%, assuming HBC disclaims all its leases. Watch the pace of backfilling that space, debt costs, and tenant sales trends. If those hold up, PMZ.UN can be a reasonable starter REIT for monthly TFSA income.

The post Invest $10,000 in This Dividend Stock for $566 in Passive Income appeared first on The Motley Fool Canada.

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More reading

• How to Turn the 2026 TFSA Contribution Into $70,000 (or More)
• The 3 Stocks I’d Buy and Hold Into 2026
• Got 300? These 3 TSX Stocks Are Too Cheap to Ignore
• These Stocks Won Big Last Year and Are Still Excellent Buys for 2026
• 2 Top TSX Stocks for Reliable Monthly Income

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends Primaris Real Estate Investment Trust. The Motley Fool has a disclosure policy.