REIT Roundup: Sabra Cuts Dividend, LTC Ends Share Repurchase Plan

IRVINE and WESTLAKE VILLAGE, Calif. — As publicly traded REITs in the seniors housing space continue to brace for the impact of the COVID-19 pandemic, Irvine-based Sabra Health Care REIT (NASDAQ: SBRA) and Westlake Village-based LTC Properties (NYSE: LTC) have announced cash-saving methods.

Sabra plans to cut its quarterly dividend from 45 cents per share to 30 cents per share, starting in May. The company expects to generate an extra $30 million per quarter, with plans to use those funds to manage debt and fund operations.

“Preservation of capital is important in times of uncertainty. Retaining a greater portion of our cash flows from operations will help us better manage our leverage as we expect to face disruption in our revenue stream during the pendency of the COVID-19 pandemic,” says Rick Matros, CEO and chairman. “It is impossible to predict the ultimate impact on our operators. We believe that reducing the quarterly dividend is an appropriate response to enhance the company’s management of this pandemic. We expect that our board will re-evaluate the dividend once the pandemic has passed.”

The company also indefinitely postponed a $150 million seniors housing investment announced in February, and “does not expect any material acquisitions or other investments in the near term.”

LTC, meanwhile, has canceled a previously announced and authorized plan to repurchase stock shares. The company’s board had approved repurchase of up to 5 million shares, and as of March 25 LTC has purchased 615,827 shares at an average price of $29.25 for a total of $18 million.

“We believe that the course for LTC now is to further increase our liquidity and help maintain our strong and flexible balance sheet,” says Wendy Simpson, LTC’s CEO and president. “With a rising level of uncertainty in all aspects of corporate life, we believe it is prudent to enhance our already high level of conservatism.”

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