Vornado shares plunge after dividend postponed to year end

Vornado Realty Trust

27/04/2023 14:41

NEW YORK, April 27 (Reuters) - Shares of Vornado Realty
Trust, a New York-based real estate investment trust that has
been slammed by remote work, fell almost 6% on Thursday after
the company postponed its dividend payment for common shares
until the end of 2023.
    The board at Vornado  VNO.N  authorized the buyback of $200
million in common stock in a new share repurchase program, but
the news comes after the trust cut its dividend by 30% in
January when it was removed from the S&P 500 index  .SPX .
    Office building landlords in New York and other big cities
have seen vacancy rates jump as remote work and a hybrid office
model have slashed demand for traditional workspace, especially
in central business districts.
    Vornado shares fell 5.9% to $14.04 in early trade, while in
pre-market trade they sold for less than $13 a share. The stock
had fallen 28% year-to-date as of Wednesday, when it closed at
$14.93.
    Vornado faces outsized interest rate risk given its elevated
leverage levels, Citigroup said in a research note last month.
About $1 billion of debt comes due through 2024, it said.
    "Valuation continues to be discounted but we struggle to
identify positive catalysts that warrant an improvement in the
valuation gap," Citi analyst Michael Griffin said.

 (edited by Emelia Sithole-Matarise)
 ((emelia.sithole@thomsonreuters.com;))