Agree Realty Corporation (ADC) recently announced a 2.5% hike in its quarterly cash dividend rate. The company will now pay a dividend of 41 cents per share for first quarter 2013, up from the prior-quarter dividend of 40 cents. The increased dividend will be paid on Apr 9, 2013 to stockholders of record on Mar 29.
Agree Realty is focused on managing its capital conservatively and in the fourth quarter of 2012, the company paid its 75th consecutive cash dividend since its initial public offering. Based on the current dividend rate, the annual dividend rate comes to $1.64 per share, compared with the 2012 annual dividend of $1.60 per share.
Agree Realty is mainly engaged in the acquisition and development of single tenant properties net leased to industry leading retail tenants. Currently, it owns and operates a portfolio of 113 properties, situated in 30 states and includes around 3.3 million square feet of gross leasable space.
Moreover, recently, Agree Realty disclosed the acquisition of 3 single tenant assets leased to industry leading retailers. The company shelled out $6.4 million for the acquisitions and the properties include a Dollar General Market in Statham, Ga., an AutoZone in North Las Vegas, Nev. and a Family Dollar in Memphis, Tenn.
We believe that opportunistic acquisitions would help Agree Realty enhance its portfolio quality, which in turn could be accretive to its earnings going forward. In addition, it aims to retain high-end tenants through long-term lease deals, thereby guaranteeing a consistent source of income. As such, the company is well poised to maintain its growth curves and simultaneously benefit the shareholders with steadily rising dividends.
In addition to Agree Realty, many other REITs have raised their dividends in the recent months. In January, AvalonBay Communities Inc. (AVB) hiked its dividend by 10.3% while in February, Simon Property Group Inc. (SPG) raised its dividend by 4.5% sequentially and BRE Properties Inc. (BRE) declared a 2.6% sequential hike in its quarterly cash dividend.
As a matter of fact, solid dividend payouts are arguably the biggest attraction for REIT investors as the U.S. law requires these companies to distribute 90% of their annual taxable income in the form of dividends to the shareholders.
In addition, Agree Realty currently has a Zacks Rank #2 (Buy).
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