Simon Property Group Telegraphs a 50% Dividend Cut
The malls that Simon Property Group (NYSE: SPG) owns are starting to reopen again after being shut down by the government in an attempt to contain the spread of COVID-19. That's very good news, but the hit this real estate investment trust (REIT) is suffering through isn't over yet -- and that's on top of a big pre-existing headwind.
Although many of its peers have cut dividends, Simon has yet to discuss its dividend plans. But CEO David Simon has provided a big hint about what's coming.
Coming into 2020, mall-owning real estate investment trusts were dealing with the so-called retail apocalypse. A bit of a hyperbolic term, it describes the store closures and bankruptcies that have swept through the retail industry as shoppers have increasingly used the internet to buy things. The bigger story here is that some retailers haven't managed to keep pace with customer preferences, either in terms of technology or the store environments and product assortments they offer. Not surprisingly, these retailers have fallen out of favor. Many have also taken on too much debt, limiting their ability to deal with the situation.
Source Fool.com
