Office Properties Income Trust OPI shares are trading lower on Thursday premarket after the company announced that it is slashing its quarterly dividend to increase liquidity.
The company’s board of trustees has reduced OPI’s regular quarterly cash distribution on its common shares from $0.25 to $0.01.
Office Properties’ cash distribution on its common shares in Q1 2023 was $0.55 per common share ($2.20 per share per year).
The new dividend rate will provide OPI with an immediate annual liquidity boost of around $47 million.
Additionally, it represents a $105 million increase in liquidity compared to the dividend rate paid in Q1 2023.
Yael Duffy, President and Chief Operating Officer of OPI, said, “Given the deterioration in market conditions since we last addressed our dividend rate in the first half of 2023, we believe it is prudent to further reduce the dividend to increase our liquidity and financial flexibility when addressing future leasing costs, capital expenditures and debt maturities”.
The dividend will be paid to the company’s common shareholders of record as of the close of business on January 22, 2024, and distributed on or about February 15, 2024.
The company exited the third quarter with cash and equivalents worth $39.63 million.
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Price Action: OPI shares are trading lower by 19.35% to $5.00 premarket on the last check Thursday.
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