Shares of New York City REIT Inc. NYC, -2.67% slid 1.7% in afternoon trading Friday, after the real estate investment trust that owns a portfolio of commercial real estate in New York, said it was “temporarily suspending” its dividend to help fund upfront costs of leasing commitments and tenant improvements. The REIT last paid a quarterly dividend of 10 cents a share in April. At current stock prices, the annual dividend rate implies a dividend yield of 7.75%, which compares with the yield for the SPDR Real Estate Select Sector ETF XLRE, +1.79% of 3.07% and with the implied yield for the S&P 500 SPX, +1.06% of 1.71%. NYC REIT said its portfolio was over 87% occupied as of June 30. “Leasing commissions and tenant improvement costs, which are payable prior to rent commencement, are economically beneficial compared to the substantial rent paid over the terms of the leases,” said Chief Executive Michael Weil. “To potentially help fund these future expenses, we are temporarily suspending the dividend as we maintain our leasing momentum.” The stock has plunged 51.4% year to date, while both the REIT sector ETF and the S&P 500 SPX, +1.06% have lost 20.3%.
