Real estate investment trusts (REIT) are excellent investments for both income and growth. Over the past 20- and 25-year periods, REITs have outperformed stocks while also paying much higher dividend yields. 

Many investors flock to REITs with large market caps or enormous real estate portfolios, investing in companies like Realty Income, Prologis, and American Tower.

While they are certainly worthwhile stocks to own, they often trade at a premium, and due to their size and scale, they grow slowly. Under-the-radar REITs often have equal if not superior growth opportunities with better pricing.

Three REIT stocks that look attractive for long-term growth as we enter the new year are Digital Realty Trust (DLR -0.90%), Camden Property Trust (CPT 1.28%), and Alexandria Real Estate Equities (ARE 1.26%). Here's why these three under-the-radar REITs should be on your buy list.

1. Digital Realty Trust

Digital Realty Trust is one of the few publicly traded data center companies. The REIT leases space in its roughly 300 facilities across 26 countries to more than 4,000 different customers. Streaming services, medical companies, insurance providers, defense contractors, retailers, and others use Digital Realty Trust to store and process digital information securely.

New technologies are being introduced each year, meaning demand for this vital infrastructure isn't slowing anytime soon. As of its third quarter 2022 earnings, the company saw a record number of bookings, which are new leases with its customers. Its funds from operations (FFO), a key metric to illustrate a REITs profitability, grew slightly. It also completed the acquisition of South African-based data center operator Teraco, which will help it expand in Africa and grow its interconnections.

Its share price has been hurt by general market volatility and concern over a potential recession. The stock is down 44% this year. But this is to investors' advantage. Long-term trends favor continued growth within this industry, and today's beaten-up share price gives investors a very attractive entry point. Plus, the REIT has 17 years of dividend increases while paying a nearly 5% yield. 

2. Camden Property Trust

The housing market has been on fire over the last few years thanks to limited supply and high demand. High-growth markets across the Sunbelt have been some of the biggest benefactors of this accelerated growth. That's excellent news for residential REIT Camden Property Trust, which owns and operates roughly 170 apartment complexes across the Sunbelt.

Camden Property Trust focuses on owning apartments in urban and suburban neighborhoods in high-density, fast-growing cities with high barriers to entry for new development. It rents to higher-income individuals who make around four times their monthly rent.

This last year has been absolutely exceptional for Camden, with the company seeing rents rise 14% year over year in the third quarter of 2022.

Demand and rental rates are falling slowly, but rental housing will always be an essential part of our economy. Even if the market were to worsen in 2023 or just beyond, people will still need a place to live. And considering its tenants have more than enough income to cover rent defaults and occupancy is above historical levels, it's not a huge threat to the company. 

The REIT has a robust development, acquisition, and redevelopment pipeline to help it grow its FFO for years to come. And it's diversifying its holdings, branching into the single-family rental market with its first build-to-rent development outside of Houston. The stock is down more than 38% this year, which puts its dividend yield around 3.4% today.

3. Alexandria Real Estate Equities

Investing in office space might not seem like a smart move in the declining office-work environment, but Alexandria Real Estate Equities isn't your average office REIT. The company specializes in the development and leasing of real estate in the biomedical and life sciences industries.

Its medical campuses offer top-the-line facilities for medical companies in major cities like Boston, San Francisco, San Diego, Seattle, and New York, along with a few others.

Business is booming right now. The third quarter of 2022 marked the third-highest quarter for net operating income (NOI) growth in the company's history, and revenue and FFO have grown in the double digits year over year. Its exceptional growth isn't an anomaly. The biomedical industry is rapidly growing, and there is a high barrier to entry, which incentivizes tenants to continually renew their leases, creating a steady income stream for the company.

Long-term demand favors the continued growth of Alexandria Real Estate Equities as biomedical developments in the pharmaceutical and medical fields continue. Like its other under-the-radar peers on this list, the stock has been negatively impacted by the bear market and recessionary fears, down 36% this year. That, in turn, has pushed its dividend yield to around 2.5% with ample coverage to maintain its payouts for many years to come.