Entertainment-related real estate earns dividends

Want to own a studio or a chain of movie houses? You can, through a real estate investment trust (REIT).

REITs are companies that own income-producing real estate and distribute cash generated by those properties to investors. By law, REITs must distribute at least 90% of taxable income to shareholders in the form of dividends. That makes them attractive to investors seeking income.

Many of the more than 200 publicly traded REITs specialize in one particular type of property, such as offices, apartments, shopping malls or hotels. At least two focus on entertainment-related real estate, a category so small that the REIT trade association doesn’t track it separately.

Hudson Pacific Properties owns office buildings in Northern and Southern California as well as the Sunset Bronson Studios (the original Warner Bros. Studios) and Sunset Gower Studios (Columbia Pictures’ headquarters through 1972). The studios represent about 20% of HPP’s revenues, but some of its office properties, including the Technicolor Building in Hollywood, also have a biz connection.

Taking a different tack is Entertainment Properties Trust (ticker symbol EPR), which owns 112 multiplex venues and close to 2,000 screens. The company also owns metropolitan ski parks and properties used for public charter schools, but 77% of its revenue comes from theater properties and associated retail operations.

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