Are timberland REITs a good investment?

They can make very good long-term investments if the REIT is well managed, the trees are taken care of, and a good mix of products is maintained.

Can timberland REITs act as a hedge against inflation?

Timberland REITs have often acted as hedges against inflation, due to the ongoing land appreciation that goes along with this business. Even when timber sales are slow, land can be sold to make up for shortfalls.

What makes timberland REITs different from other REITs?

Timberland REITs are different from other REITs in that they largely don't rely on rents to keep them afloat. Instead, they produce wood products. The value of the land appreciates and can be sold.

Can individual investors buy timberland REITs?

Absolutely! There are two mentioned in this article that are available on the stock market for anyone to buy.

Do timberland REITs pay dividends?

All REITs pay dividends as part of their overall structure.

How do timber prices affect timberland REIT performance?

The price of timber is the single most important driver of timberland REIT performance. Since they don't rent land to other companies, and instead grow timber on their properties, the vast majority of the income for a timberland REIT comes from sales of the trees and tree products they grow.

Who invests in timberland REITs?

Timberland REITs tend to be the domain of long-term investors, especially those who have plenty of time to wait for trees to grow and be cut. They're also a great hedge against inflation and market volatility.

Best Timberland REITs for 2026 and How to Invest

Considering investing in timberland? These timberland REITs can give you the returns without the headache of self-management.

By Kristi Waterworth – Updated Mar 23, 2026 at 10:46 AM EST | Fact-checked by Frank Bass

Key Points

Timberland REITs generate income through timber sales, differing from typical rental-income REITs.
Investing in timber REITs can hedge against inflation as rising timber prices boost land values.
Market volatility and natural disasters pose significant risks to timberland REIT investments.

Timberland real estate investment trusts (REITs) are real estate companies that focus on owning and managing land used to grow timber. That makes them different from other REITs, which mostly concentrate on owning buildings or other facilities rented out to tenants.

Given the difference, investors need to understand how timberland REITs work, the advantages of owning them, and their risks. Here's a closer look at those factors and some timberland REITs to consider.

Understanding timberland REITs

Timberland REITs own and manage timberland real estate. They harvest and sell timber to lumber mills and wood product manufacturing facilities owned by the REIT or a third party. Timberland REITs also focus on maximizing the value of their land holdings, which can include selling it for various uses other than for growing timber, such as conservation or housing.

This business model makes timberland REITs different from many other REITs. Most REITs generate relatively stable rental income by leasing their real estate to tenants. On the other hand, timberland REITs earn income by selling timber, wood products, and real estate. The price of the commodities tends to ebb and flow with supply and demand, making earnings more volatile. Timber REITs can be similar to other cyclical stocks that produce commodities, such as basic material companies and oil producers.

Top two timberland REITs to consider in 2026

There are two publicly traded timberland REITs:

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Ticker Information Table
Name and ticker	Market cap	Dividend yield	Industry
Weyerhaeuser (NYSE:WY)	$17.1 billion	3.55%	Specialized REITs
Rayonier (NYSE:RYN)	$6.1 billion	5.29%	Specialized REITs

Data as of May 24, 2026. Showing 2 of 2 tickers.

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Here's a closer look at these timberland REITs:

1. Weyerhaeuser

NYSE: WY

Weyerhaeuser

Today's Change

(0.59%) $0.14

Current Price

$23.66

Key Data Points

Market Cap

$17B

Day's Range

$23.48 - $23.85

52wk Range

$21.16 - $27.86

Volume

Avg Vol

5.4M

Gross Margin

14.67%

Dividend Yield

3.55%

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Weyerhaeuser (WY +0.59%) is, by far, the largest timberland REIT. It owns 10 million acres of timberland in the U.S. and manages land in Canada under long-term licenses. The company also operates 34 wood product manufacturing facilities across North America. In addition, it has a real estate, energy, and natural resources business that aims to get the most value out of every acre of land it owns.

Aside from its scale and diversification, another factor that sets Weyerhaeuser apart from other timberland REITs is its dividend policy. The company implemented a new framework in late 2020 to pay a base quarterly dividend, plus a variable supplemental dividend. The company set the base payout to be sustainable at lower commodity prices. Meanwhile, the variable supplemental dividend would see Weyerhaeuser pay out additional cash to shareholders when lumber prices are higher. Overall, it aims to distribute 75% to 80% of its annual funds available for distribution via dividends.

2. Rayonier

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NYSE: RYN

Rayonier

Today's Change

(-0.15%) $-0.03

Current Price

$20.36

Key Data Points

Market Cap

$6.1B

Day's Range

$20.23 - $20.66

52wk Range

$19.49 - $27.34

Volume

2.5M

Avg Vol

2.8M

Gross Margin

27.55%

Dividend Yield

5.29%

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Advantages of investing in timberland REITs

There are a few advantages to owning timberland REITs in your portfolio, including:

Solid lumber investment play. Higher timber prices can drive up timber REIT earnings. That makes timberland REITs a great way to invest in lumber when the market is on a cyclical upswing. The housing market is a big driver of lumber prices, making timberland REITs another way to invest in housing.
Increasing timber demand. While lumber prices can be volatile due to changes in demand, they tend to increase over the long term. A growing population drives the need for more housing and more lumber.
Inflation hedging. As a commodity, lumber benefits from inflation. Timberland is a good inflation hedge since rising lumber and land prices should boost the value of a timber REIT's land portfolio and its cash flow from selling timber, wood products, and real estate.

Risks of investing in timberland REITs

The risks of timberland REITs aren't insubstantial, however, and should also be considered before investing. These include:

Possible volatility. While timberland REITs benefit from higher lumber prices, which boost their revenue and earnings, falling lumber prices can cause revenue and earnings to decline. That variability can make timberland REIT stock prices more volatile than other REITs. Periods of prolonged lower lumber prices can force a timber REIT to reduce its dividend.
Unpredictable natural disasters. In addition to commodity price risk, nature represents another risk for timberland REITs. Wildfires, weather events, diseases, and insects can all destroy timberland. The effects of climate change could have an outsized impact on timberland REITs.
Interest rate risk. Meanwhile, timber REITs also face a risk common to all REITs: interest rate risk. Like other REITs, timberland REITs tend to borrow a lot of money to acquire property. As interest rates rise, a timberland REIT's interest expenses can increase if it has a floating rate or an upcoming debt maturity.
Potential for declining stock prices. Rising interest rates also increase the income yield on lower-risk investments such as government bonds. That gives income-focused investors more options. As a result, REIT stock prices often decline, and dividend yields are increased to compensate investors for their higher risk profile. Some of this risk can be offset with appropriate portfolio diversification, even if you prefer to keep all your money in REITs.

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FAQ

Timberland REITs FAQ

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About the Author

Kristi Waterworth has been a contributing real estate and financial expert at The Motley Fool, covering real estate, investing, and personal finance topics, since 2020. Kristi has been interviewed by various TV media outlets and podcasts for her real estate investing expertise – from residential real estate to digital real estate and everything in between. Kristi’s journalist career spans over 25 years, and she has written about real estate investing, homeownership, and home construction specifically for the last decade. She was also previously a licensed Realtor and general building contractor before the Great Recession and housing market collapse. She holds a bachelor’s degree in American history from Columbia College in Missouri.

TMFMaldivesBlue

@MaldivesBlues

Kristi Waterworth has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Best Timberland REITs for 2026 and How to Invest

Considering investing in timberland? These timberland REITs can give you the returns without the headache of self-management.

Key Points

Understanding timberland REITs

Top two timberland REITs to consider in 2026

1. Weyerhaeuser

NYSE: WY

Key Data Points

2. Rayonier

NYSE: RYN

Key Data Points

Advantages of investing in timberland REITs

Risks of investing in timberland REITs

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Best Mortgage Stocks for 2026 and How to Invest

Best Office REITs for 2026 and How to Invest

Best Healthcare REITs for 2026 and How to Invest

Best Industrial REITs for 2026 and How to Invest

FAQ

Timberland REITs FAQ

Are timberland REITs a good investment?

Are timberland REITs a good investment?

Can timberland REITs act as a hedge against inflation?

Can timberland REITs act as a hedge against inflation?

What makes timberland REITs different from other REITs?

What makes timberland REITs different from other REITs?

Can individual investors buy timberland REITs?

Can individual investors buy timberland REITs?

Do timberland REITs pay dividends?

Do timberland REITs pay dividends?

How do timber prices affect timberland REIT performance?

How do timber prices affect timberland REIT performance?

Who invests in timberland REITs?

Who invests in timberland REITs?

About the Author

Read Next

Stocks Mentioned

Premium Investing Services

Understanding timberland REITs

Top two timberland REITs to consider in 2026

NYSE: WY

Key Data Points

Best Mortgage Stocks for 2026 and How to Invest

Best Office REITs for 2026 and How to Invest

Best Healthcare REITs for 2026 and How to Invest

Best Industrial REITs for 2026 and How to Invest

Timberland REITs FAQ

Are timberland REITs a good investment?

Are timberland REITs a good investment?

Can timberland REITs act as a hedge against inflation?

Can timberland REITs act as a hedge against inflation?

What makes timberland REITs different from other REITs?

What makes timberland REITs different from other REITs?

Can individual investors buy timberland REITs?

Can individual investors buy timberland REITs?

Do timberland REITs pay dividends?

Do timberland REITs pay dividends?

How do timber prices affect timberland REIT performance?

How do timber prices affect timberland REIT performance?

Who invests in timberland REITs?

Who invests in timberland REITs?

Advantages of investing in timberland REITs

Risks of investing in timberland REITs

Factors to consider when investing in timberland REITs

Tax considerations for timberland REITs

2. Rayonier

How to invest in timberland REITs

NYSE: RYN

Key Data Points