10 Best REIT Stocks to Buy According to Billionaires

6. Digital Realty Trust, Inc. (NYSE:DLR)

Number of Billionaires: 10

Number of Hedge Fund Holders: 47

Digital Realty Trust, Inc. (NYSE:DLR) is a real estate investment trust that owns, operates, and invests in carrier-neutral data centers. The firm delivers the full spectrum of data center, colocation, and interconnection solutions thereby supporting leading enterprises and service providers.

The REIT’s leading data center platform benefits from the growing global demand from a diversified, high-quality customer base. The firm continues to grow its global footprint as it recently announced a joint venture with a leading Southeast Asian digital infrastructure platform, Bersama Digital Infrastructure Asia, to operate and develop data centers in Indonesia.

Furthermore, secular tailwinds currently remain strong for the REIT with digital transformation driving a strong data center demand. With embedded internal expertise as one of the world’s largest data center acquiror, developers, owners, and operators, Digital Realty Trust, Inc. (NYSE:DLR) is a promising stock. Reiterating the strong demand drivers for the REIT, Baron Funds stated the following in its Q4 2024 investor letter:

“Data center landlords such as Equinix and Digital Realty Trust, Inc. (NYSE:DLR) are benefiting from record low vacancy, demand outpacing supply, more constrained power availability, and rising rental rates. Several secular demand vectors, which are currently broadening, are contributing to robust fundamentals for data center space globally. They include the outsourcing of information technology infrastructure, increased cloud computing adoption, the ongoing growth in mobile data and internet traffic, and AI as a new wave of data center demand. Put simply, each year data continues to grow exponentially, and all of this data needs to be processed, transmitted, and stored – supporting increased demand for data center space. In addition, while it is still early innings, we believe AI could not only provide a source of incremental demand but also further accelerate existing secular trends by driving increased prioritization and additional investment in digital transformation among enterprises.”