InvenTrust Suspends Share Repurchases and Distribution Reinvestment Plan
InvenTrust Properties Corp., a publicly registered non-traded real estate investment trust formerly known as Inland American Real Estate Trust, has suspended its share repurchase program and distribution reinvestment plan until further notice.
InvenTrust Properties Corp., a publicly registered non-traded real estate investment trust formerly known as Inland American Real Estate Trust, has suspended its share repurchase program and distribution reinvestment plan until further notice, citing consequences stemming from the COVID-19 pandemic. The company indicated that the suspensions will be temporary.
In addition, the REIT signaled possible future changes to its distribution rate, share repurchase program, and the dividend reinvestment plan.”
The suspensions will go into effect on July 11, 2020. Beginning with the distributions previously authorized by the board for June 2020, which are paid in July 2020, any stockholder receiving their monthly distribution through the DRP will now receive a check or distribution statement showing their monthly distribution. The suspension of the DRP will not affect the payment of distributions to stockholders who previously received their distributions in cash, the company said.
According to a letter to shareholders, InvenTrust plans to redeem shares on June 27, 2020 for shareholders currently in queue. However, the company does not anticipate having sufficient funds to redeem shareholders from the “general” category. All SRP requests will remain in the queue in the event that InvenTrust reinstates the SRP, the company said.
The company noted that there is a “low participation level” in the distribution reinvestment plan, which funds share repurchases.
“As of June 1, we collected over 72 percent of our rent owed for April and about 64 percent for May,” the company said in a letter to shareholders. “June collections should be similar to May. Currently over 90 percent of our tenants (by square footage) are cleared by the government to open for business. We believe the essential nature of our portfolio and tenants will lead to improved rent collections over the next several months.”
“Despite our efforts, the consequences of COVID-19 will be significant and prolonged, the company added. “We expect our portfolio and our financial performance to be affected. To prepare for this impact, the board and management team are evaluating our corporate policies including the distribution rate, the share repurchase program, and the dividend reinvestment plan.”
In April, InvenTrust paid its quarterly distribution at the previously announced 3 percent increase, and the board has elected to maintain the current dividend rate.
InvenTrust Properties invests in grocery-anchored open-air centers in the Sun Belt region of the U.S. The offering launched in August 2005, became a self-managed REIT in 2014, and oversees a multi-billion-dollar portfolio of 65 retail properties, representing 10.9 million square feet of retail space, as of December 31, 2019.
