The Perfect TFSA Stock: A 6.1% Yield with Monthly Paycheques

Ask most income investors what they enjoy most about dividend investing, and many won’t mention the yield first. They’ll talk about consistency. In addition, if the dividend income is received every month, it makes a Tax-Free Savings Account (TFSA) feel more tangible. Instead of waiting for a once-a-quarter payment, investors see cash arrive every month, which could be reinvested or saved for future opportunities without triggering tax on the income.

That is why a well-run real estate investment trust (REIT) could be appealing inside a TFSA. The right trust gives investors exposure to hard assets, recurring rental income, and steady distributions. For example, SmartCentres Real Estate Investment Trust (TSX:SRU.UN) has worked to build exactly that kind of business, pairing a large portfolio of Canadian real estate with a distribution yield that’s difficult to ignore.

In this article, I’ll discuss why SmartCentres stock stands out as a solid TFSA stock offering both an attractive dividend yield and the appeal of monthly paycheques.

A retail REIT with familiar assets

If you don’t know it already, SmartCentres REIT develops, leases, owns, and manages shopping centres, office buildings, rental residences, and industrial properties across Canada. Its portfolio includes about 200 strategically located properties, giving the trust a broad footprint in the Canadian real estate sector.

After climbing by 18.4% in the last year, SmartCentres stock currently trades at $30.31 per share with a market cap of about $4.4 billion. With this, it’s trading just 2% below its 52-week high. At this market price, the stock also offers an attractive dividend yield of 6.1%, paid on a monthly basis.

That price strength matters because many REITs have struggled with higher borrowing costs and investor caution in recent years. However, SmartCentres has still managed to move higher, suggesting the market continues to see value in its property base and monthly distribution.

Recent results point to steady demand

Retail demand remains strong across SmartCentres REIT’s portfolio. In the first quarter of 2026, its lease extensions were completed with average rent growth of 11.5% year-over-year (YoY), excluding anchors, as the trust continued focusing on value-oriented retail and higher-quality tenants.

This is an important distinction. Retail real estate is cyclical, but properties tied to everyday shopping needs tend to be more resilient than destination malls or weaker locations. That could support occupancy and recurring rental income.

Meanwhile, the REIT continues to focus on development as many of its new retail projects are underway in Kingston, Lindsay, and Winnipeg.  Similarly, it’s constructing a 200,000-square-foot retail building pre-leased to Canadian Tire in Toronto.

A growth plan beyond retail

Financially, SmartCentres reported net operating income of $137.7 million for the first quarter, up 0.7% YoY. The company’s funds from operations (FFO) were $0.54 per share, while adjusted FFO per unit was $0.52, as higher base rent helped offset rising interest and administrative costs.

The trust is also working on larger mixed-use opportunities. Its ArtWalk condo Tower A in the Vaughan Metropolitan Centre is nearly 93% pre-sold, with 340 units, highlighting demand for its residential pipeline.

At the same time, the REIT has simplified the business by settling legacy earn-out arrangements, terminating mezzanine loans, and consolidating certain fees paid to Penguin. Those steps should improve its cash flow visibility and make its structure easier for investors to understand.

For TFSA investors, a simpler structure could be useful because it gives more visibility to cash flow. If SmartCentres REIT keeps improving that visibility while prudently advancing development projects, its share price could deliver solid returns on investment.

The post The Perfect TFSA Stock: A 6.1% Yield with Monthly Paycheques appeared first on The Motley Fool Canada.

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* Returns as of June 15th, 2026

More reading

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• A Perfect TFSA Stock: A 6% Yield With Constant Paycheques
• A Monthly-Paying TSX Stock With a 6.1% Dividend Yield

Fool contributor Jitendra Parashar has no position in any of the stocks mentioned. The Motley Fool recommends SmartCentres Real Estate Investment Trust. The Motley Fool has a disclosure policy.