Covered, but once a year and going nowhere. Vornado pays a single annual common dividend, in the fourth quarter, subject to Board approval — $0.74 a share, paid December 29, 2025, with the company anticipating the same Q4 policy for 2026. Against the $34.80 close on October 23, 2026 that is a ~2.1% yield. Coverage on funds from operations is comfortable: second-quarter 2026 FFO as adjusted was $0.67 a share, up from $0.56 a year earlier, and first-half adjusted FFO of $1.19 a share annualizes to about $2.38, putting the $0.74 dividend at roughly 31% of that run rate. Same-store NOI rose 9.8% in the quarter, 11.9% in New York. What keeps this a warning rather than a clean pass is the shape of the payout: flat at $0.74 for two years, down from $2.12 of quarterly dividends through 2022, and a full year passes between payments — a holder who misses the Q4 declaration waits a year, not a month.
Key risk: Manhattan office concentration and the annual cadence — the portfolio and the payout both turn on New York leasing, interest expense was $89.6 million in the second quarter and higher rates cut adjusted FFO by $10.2 million year over year, and a skipped or cut Q4 declaration costs a whole year of income, not one cheque.
Changes if: The fourth-quarter 2026 dividend is not declared, or is cut below $0.74, adjusted FFO falls back toward the first quarter's $0.52 a share, or Manhattan same-store NOI stalls. Any of those turns a covered annual payer into a cut question.
- ✓FFO coverage check: First-half 2026 FFO as adjusted of $1.19 a share ($0.52 in Q1, $0.67 in Q2) annualizes to about $2.38, against a $0.74 annual dividend — roughly 31% paid out. Vornado itself notes 2026 FFO/FAD payout ratios are not available because only one dividend is expected for the year, so this is an annualized first-half proxy, not a company-published payout ratio.
- !Dividend growth check: Flat, not compounding — $0.74 in 2024 and again in 2025, $0.68 in total in 2023, against $2.12 of quarterly dividends through 2022. The quarterly payer became an annual payer, and the annual amount has not grown.
- !Debt-to-EBITDA check: Not scored — no clean, verified debt-to-EBITDA figure was available from the second-quarter 2026 release used here, so it is omitted rather than estimated, per the House rule. Second-quarter EBITDAre attributable to the Operating Partnership was $279.9 million, up from $267.3 million a year earlier.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.