3 ASX dividend shares with higher yields

There are some ASX dividend shares that offer higher yields.

Here are three ideas to consider:

Brickworks Limited (ASX: BKW)

Brickworks is an ASX dividend share with one of the longest dividend records on the ASX. It hasn’t cut its dividend in over 40 years.

The business may be best known for its Australian building products divisions, but it’s actually the other assets that entirely support the Brickworks dividend.

Brickworks has a 50% stake of an industrial property trust along with Goodman Group (ASX: GMG). Brickworks supplies the land, which is excess to requirements, and then Goodman provides the necessary infrastructure works and the contacts with quality potential tenants.

One example of this arrangement working is the gigantic high-tech warehouse that is currently being built for Amazon in Sydney. Amazon is one of Goodman’s largest global tenants. Another big warehouse is also being built for Coles Group Ltd (ASX: COL). After those two warehouses are built, it’ll increase the gross assets of the trust by around $900 million to $3 billion. It’ll also grow the rental profit distributions to Brickworks by at least 25%.

The other asset supporting the Brickworks dividend is its approximate 40% holding of Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). Soul Patts is an ASX dividend share itself, it owns a diversified portfolio with investments across telecommunications, building products, resources, financial services, listed investment companies (LICs) and agriculture.

At the current Brickworks share price it has a grossed-up dividend yield of 4.25%.

Charter Hall Long WALE REIT (ASX: CLW)

This is a real estate investment trust (REIT) that has long rental contracts with high quality tenants. It’s rated as a buy by the broker Citi.

At 31 December 2020, the ASX dividend share had a weighted average lease expiry (WALE) of 14.1 years, which was slightly up from 14 years at 30 June 2020.

It has tenants like Telstra Corporation Ltd (ASX: TLS), Australian government entities, BP, Woolworths Group Ltd (ASX: WOW), Inghams Group Ltd (ASX: ING), Coles and David Jones.

Those tenants are spread across property classes like telecommunication exchanges, service stations, agri-logistics, offices and long WALE retail.

In the FY21 half-year result which was just released, operating earnings per share (EPS) and the distribution per security grew by 3.6% to 14.5% cents.

The net tangible assets (NTA) increased by 5.1% to $4.70. It had balance sheet gearing of 29%, with look through gearing of 39.3%.

At the current Charter Hall Long WALE REIT share price, it has a FY21 distribution of at least 6.1% based on management guidance of operating EPS.

360 Capital REIT (ASX: TOT)

This is another REIT, it’s managed by 360 Capital Group Ltd (ASX: TGP).

The REIT ASX dividend share invests across the entire real estate industry to take advantage of varying market conditions in order to maximise returns for investors.

In a recent change of strategy, 360 Capital REIT is now focusing on equity investing in real estate assets and businesses, and exiting its debt investments.

One example of recent investment includes the $78.6 million investment into Irongate Group (ASX: IAP). 360 Capital REIT also announced it had agreed terms to become a major equity partner in an unlisted real estate funds management platform with settlement expected this month.

Based on the recurring nature of the income from the above investments, the REIT decided to provide guidance of 6 cents per unit for FY21. At the current 360 Capital REIT share price, that equates to a distribution yield of 6.8%.

More reading

• 2 ASX dividend shares rated strong buys by brokers
• ASX 200 rises 0.6%, Vocus jumps on takeover offer, Afterpay hits new record
• What’s moving the Charter Hall Long WALE (ASX:CLW) share price today?
• 2 ASX dividend shares with yields above 5%
• 2 secret ASX dividend shares with large yields

Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Brickworks, Telstra Limited, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of COLESGROUP DEF SET and Woolworths Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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