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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Les H who wrote (196504)	4/15/2009 11:03:35 PM
From: Les H	Read Replies (1) \| Respond to of 306849

this year REITs can issue stock for 90% of their dividend instead of paying shareholders in cash. Simon, which features a better balance sheet than most property companies, took full advantage and paid its fourth quarter dividend of 90 cents a share with only nine cents of cash. Simon told shareholders the switch would allow the firm to hold onto $925 million if continued for the rest of the year. Other solid names paying part of their dividends in stock include apartment firms Aimco and AvalonBay Communities ( AVBPRH - news - people ) and office landlord Vornado Realty Trust ( VNO - news - people ). For REIT investors the dividend switcheroo stings. As with a stock split, they still own the same fraction of the company, they just have more pieces of paper saying they do. If they choose to sell, the market should discount the price to reflect the smaller size of the pie slices. They also have to pay taxes (in cash) on the stock dividend and it comes at a time when many people are counting on income-producing investments to help them through tough economic times. forbes.com