Dividend Cuts And Overdue Rent: REIT Earnings Recap
Updated: Sep 10, 2020
Did dividends get cut? Did the rent get paid? With REIT earnings season now complete, we compiled rent collection metrics and the status of dividend distributions across the REIT sector.
For property landlords, it's tough to pay dividends to shareholders if you're not collecting the rent. Dividend cuts have abated in recent months as rent collection has sequentially improved.
After 59 equity REITs and 31 mortgage REITs announced a dividend cut in March through June, just two additional equity REITs have announced a reduction since the start of July.
Roughly 90 REITs have maintained dividends at previous levels, while 20 REITs have announced a dividend increase in 2020 - primarily in the "essential" property sectors - housing, industrial, and technology.
Rent collection has remained a non-factor for these "essential" property sectors - which bodes well for the prospectus of future dividend distributions - with collection rates averaging over 95%.