Ringing in good tidings for its shareholders, SL Green Realty Corp. (SLG) declared a 20% sequential increase in its fourth-quarter 2014 dividend. This real estate investment trust (REIT) raised the quarterly dividend rate to 60 cents from 50 cents. The new dividend will be paid on Jan 15, 2015 to shareholders of record as of Jan 2, 2015.
Based on this, the 2014 annual dividend rate comes to $2.40 per share and results in an annualized yield of about 2.1%, considering SL Green’s closing price of $116.35 on Dec 1. Notably, a steady dividend payout facilitates the long-term strategy of the company to provide attractive risk-adjusted returns to stockholders.
As a matter of fact, SL Green’s continuous enhancement of its operating portfolio performance justifies this dividend hike. Consequently, in October, keeping its winning streak alive, SL Green’s third-quarter FFO, including transaction costs, came in at $1.52 per share, exceeding the Zacks Consensus Estimate by 7 cents and the prior-year quarter figure by 22 cents.
Additionally, the company’s successful portfolio enhancement initiative is also a reason for its move of rewarding investors. Notably, SL Green has been dedicatedly accelerating its investment in opportunistic assets, and debt and preferred equities. Along with this, the company has also been witnessing strong leasing activity, especially in the New York district.
In tune with this, last month SL Green bought an asset in the premier SoHo retail district (read more: SL Green Buys Asset, Strengthens SoHo Retail Portfolio). Moreover, the company inked a long-term lease deal with TD Bank, a subsidiary of The Toronto-Dominion Bank (TD) at its proposed tower in New York (read more: SL Green Pre-Leases Space at One Vanderbilt to TD Bank). Such moves promise bright prospects.
To gain a deeper insight into SL Green, you can refer to our updated research report issued on Dec 1, 2014.
SL Green currently carries a Zacks Rank #3 (Hold). Investors interested in the REIT industry may consider stocks like Cousins Properties Incorporated (CUZ) and DCT Industrial Trust Inc. (DCT). Both stocks carry a Zacks Rank #2 (Buy).
Note: FFO, a widely used metric to gauge the performance of REITs, are obtained after adding depreciation, amortization and other non-cash expenses to net income.
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