Vornado Realty Trust (VNO), a fully-integrated equity real estate investment trust, will cut its quarterly dividend by 19.7 percent to 53 cents per share in 2020 because of COVID-19. Last year the REIT paid a special dividend of $1.95 per share and hiked its regular quarterly dividend 4.8 percent to 66 cents per share.

In a press release dated July 30, 2020, the company announces the dividend cut in recognition of the uncertain and rapidly changing environment caused by the COVID-19 pandemic. The decrease is consistent with Vornado’s policy of paying out 100% of taxable income.

The regular annual dividend of $2.12 per share yields 6.1% at a stock price of $34.68. The next dividend will be payable on August 21, 2020 to shareholders of record on August 10, 2020.

Vornado has cut its dividend several times the last couple of years with a 4.8 percent cut announced in 2017, a 13.7 percent cut in 2015 and a 31.6 percent cut in 2009 during the financial crisis. Because of this latest action the average annual regular dividend growth over the last five years is negative (-3.4 percent). 

The stock price of Vornado Realty Trust is down 47.9 percent year-to-date resulting in a current market cap of $6.6 billion. The company now pays an estimated $405 million in dividends to shareholders annually. Other REITs cutting their dividend recently are Simon Property Group and VEREIT.

Vornado Realty Trust is a fully-integrated real estate operating company. The  company operates through two segments: New York and Washington, DC. The company holds office, residential and hotel properties, including the 3.7 million square foot Mart (theMart) in Chicago and Manhattan street retail, residential and office space, including Hotel Pennsylvania located on Seventh Avenue at 33rd Street in the heart of the Penn District and 220 Central Park South, a 950-foot super-tall luxury residential condominium tower containing 400,000 salable square feet. Vornado has been paying a dividend to shareholders every year since at least 1990.