2 REIT Stocks That Could Deliver Passive Income

In an era of market volatility and unpredictable interest rates, investors continue to seek stability and regular income. Real Estate Investment Trusts (REITs) remain one of the most effective ways to generate passive income while gaining exposure to property without directly owning it. On the ASX, Charter Hall Long WALE REIT (ASX: CLW) and Dexus Convenience Retail REIT (ASX: DXC) stand out as reliable performers, offering attractive yields and defensive portfolios.

Both REITs are anchored by long-term leases and exposure to essential property sectors—making them ideal for income-seeking investors who value consistency and resilience.

Charter Hall Long WALE REIT: A Defensive Powerhouse Built for Stability

Charter Hall Long WALE REIT (CLW) has established itself as one of Australia’s most stable property income vehicles. Its strategy revolves around owning assets with long lease durations—providing predictable rental income even during economic uncertainty.

Key Features & FY25 Performance Highlights

1. Operating earnings: $178.6 million, translating to 25.0 cents per security.
2. Distribution: 25.0 cents per security in FY25, with management guiding 25.5 cps in FY26—implying a yield of around 6.2% at current prices.
3. Portfolio occupancy: An impressive 99.9%, with a weighted average lease expiry (WALE) of 9.3 years—among the highest in the ASX-listed REIT space.
4. Portfolio value: Over $5.5 billion, spread across industrial, logistics, government, and other “essential service” tenants such as Telstra, Coles, and the Australian Government.
5. Recent moves: $338.8 million in asset divestments, $222.9 million in new accretive acquisitions, and a $50 million buyback—a rare move among REITs, signaling management’s confidence in value creation.

With interest rate volatility still a concern, CLW’s active refinancing and interest rate hedging strategy are key strengths. It has managed to extend its debt maturities and lock in lower-cost funding, which should safeguard cash flow in FY26.

Why It Stands Out

CLW’s appeal lies in its predictability. Investors benefit from recurring income streams tied to tenants with strong credit profiles and long-term leases. The REIT’s focus on mission-critical properties—like logistics and infrastructure assets—ensures demand remains stable regardless of economic conditions.

For investors seeking dependable income and low volatility, CLW remains one of the top-tier names on the ASX.

Dexus Convenience Retail REIT: Everyday Assets, Extraordinary Returns

If Charter Hall Long WALE REIT represents stability, Dexus Convenience Retail REIT (DXC) brings consistency with a twist of growth potential. DXC owns service stations, convenience stores, and fast-food properties—businesses that thrive on everyday consumer demand.

In short, DXC is a REIT that earns rent from “necessity retail”—the kind of spending that doesn’t slow down much even during tough times.

FY25 Snapshot & Income Highlights

1. Net profit after tax: $39.4 million, a sharp rise from $3.4 million in FY24, boosted by higher property valuations and strong rent collections.
2. Distribution yield: Around 7.4%, one of the highest yields in the Australian listed property space.
3. Tenant strength: Occupied by blue-chip operators including Coles Express, 7-Eleven, and Ampol, ensuring dependable rent payments.
4. Average lease expiry: Over 8 years, offering stable cash flow visibility.
5. Gearing: 29.4%, comfortably within management’s conservative target range.
6. Recent update: Declared another quarterly dividend in August 2025, reinforcing its track record of consistent income delivery.

DXC continues to enhance its portfolio by recycling capital—selling non-core sites and acquiring higher-yielding convenience assets. This disciplined approach keeps earnings steady while maintaining flexibility for future growth.

Why It Stands Out

DXC’s strength lies in its defensive nature and inflation-linked leases. As fuel and convenience operators typically pass cost increases to customers, rental income adjusts upward, providing a natural inflation hedge. With Australia’s population growth and rising travel demand, DXC’s properties are well-positioned for sustainable occupancy and rent growth.

For those wanting passive income with inflation protection, DXC ticks all the boxes.

Why These REITs Are Perfect for Passive Income Seekers

Both CLW and DXC represent a blend of income stability and capital preservation. Here’s why they stand out in 2025:

1. Long Lease Durations: Multi-year, inflation-linked leases ensure predictable rent and protect against short-term market shocks.
2. Defensive Asset Classes: From logistics warehouses to fuel stations, these are mission-critical assets that remain in demand regardless of economic cycles.
3. Attractive Yields: With yields between 6% and 7.5%, these REITs offer higher income than term deposits or government bonds—without excessive risk.
4. Professional Management: Both Charter Hall and Dexus are among Australia’s top real estate managers, with strong track records of capital discipline.
5. Solid Balance Sheets: Conservative gearing and ongoing asset recycling mean both trusts are well-prepared for future opportunities.

The Bigger Picture: Real Estate Stability Amid Volatility

As interest rates fluctuate and equity markets remain unpredictable, income investors are once again turning to property-backed securities. REITs like CLW and DXC provide the advantage of diversified exposure, professional management, and liquid investment access—without the hassles of being a landlord.

In 2025, Australia’s property market is stabilizing, and yields remain attractive. Both these REITs are well-placed to continue paying solid, recurring distributions—making them valuable portfolio anchors for income-focused investors.

Conclusion: Passive Income With Peace of Mind

Whether you prefer Charter Hall Long WALE REIT’s defensive, long-term leases or Dexus Convenience Retail REIT’s dependable everyday assets, both offer one thing investors crave most—steady, stress-free income.

They’re not just property plays—they’re peace-of-mind investments, built to deliver through economic ups and downs.

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