Reinvesting REIT Dividends in a Roth IRA = "Infinite Money Glitch" - What is the catch?

Hello All! As the title suggests, I have a question about dividend investing within a Roth IRA, specifically with companies with high dividend payouts. The example company I will use is $DX.

I was recently pitched this idea:

Couple of assumptions:
$DX grows at 2% a year. Dividend grows at 1% per year.

Say you have $285,000 in a Roth IRA and you are near 60 years old. If you allocated all $285,000 of this into $DX at approximately $12.45/share you would own \~22,891 shares. At a current monthly dividend of $0.17, you would recieve a monthly check of \~$3,891. If you were to reinvest your entire monthly dividend check back into $DX and repeat this process for awhile, you would accumulate many shares and your monthly payment would greatly increase.

Now, you have reached your retirement at age 68.5 and you have decided to take $12,000 per month for living expenses. However, by repeating the process above, your monthly dividend payment is \~$18,500, so you still have \~$5,500 to reinvest into $DX and thus grow your portfolio further and only live off of a portion of just the dividend payouts.

This seems like an "infinite money glitch" in theory, but I am wondering what the catch is or why this is not used more often? As of now, the only thing I have been able to come up with is lack of diversification.