Another non-listed REIT, this time Behringer Harvard REIT I which owns 74 office bldgs., has announced that it will slash its annualized dividend rate. In a letter to shareholders dated May 15, the company reports that it will cut its annual dividend rate from 6.5% to 3.25%, based on an original share purchase price of $10. This reduction will take effect with the company’s monthly dividends payable for the months of April, May and June 2009. The company pays dividends monthly, approximately 30 days after the end of the month for which the dividend is payable.
Behringer Harvard REIT I is the third largest nonlisted REIT in terms of total assets. With this announcement, four of the five largest nonlisted REITs have cut their dividend rate in the past several months. The other three companies include Inland American Real Estate Trust, Inland Western Retail Real Estate Trust and Piedmont Office Realty Trust. This brings the number of nonlisted REITs that have cut their dividend rate in recent months to eight.
In connection with this dividend reduction, Behringer Advisors, the advisor to the company, has agreed to waive $5 million of asset management fees that Behringer Harvard REIT I would be obligated to pay for the second and third quarters of 2009. The company believes these measures will assist it in maintaining the liquidity it will need to meet the potential challenges resulting from the current economic downturn.
To review the shareholder letter reporting these events, visit
http://www.sec.gov/Archives/edgar/data/1176373/000110465909033010/a09-11271_2ex99d1.htm