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HCP, Inc. (NYSE:PEAK) is a member of the S&P 500 Dividend Aristocrats index and has a history of annual dividend growth that stretches back to 1985. However, an upcoming change in the healthcare REIT's structure has left investors uncertain about whether or not the streak will continue.

A rock-solid dividend history

When you look at HCP's history, the question of whether or not the company will raise its dividend in 2017 may seem like a silly one to ask. After all, HCP has increased its dividend for 31 consecutive years, no matter what the market was doing at the time.

Image source: HCP investor presentation. 

HCP was actually the first REIT added to the S&P 500 Dividend Aristocrats index, which is composed of companies that have increased dividends for at least 25 consecutive years. With this flawless history of dividend growth, it seems like a no-brainer that the streak will continue in 2017.

HCP's upcoming spinoff could be a wild card

In May, HCP announced its intention to spin off its HCR ManorCare portfolio of skilled nursing and acute care properties into a newly created REIT, to be completed later in 2016. You can read the full details of the proposed spinoff here, but the general idea is that it will leave HCP with a higher-quality asset portfolio, and allow the managers of the new REIT to use different strategies to try and unlock hidden value from the troubled HCR ManorCare properties.

Image source: HCP investor presentation. 

While I have an extremely favorable view of the spinoff, it is unclear what it will mean to the company's dividend. During the first-quarter conference call, recently departed CEO Lauralee Martin had this to say about the post-spinoff dividends of both companies: 

Until the spin happens, our current dividend policy will continue. Post-spin, obviously, the dividend policy for Spin (the new REIT) will be set by the board of that company...And I expect that we will have a dividend policy that is focused on total shareholder return, which means growth in the company and growth in our dividend.

Now, this is intentionally vague, but it does bring up some important points. First, dividend growth is a point of pride for HCP, and I believe the post-spinoff HCP will continue to raise its dividend in 2017, relative to the assets remaining in its portfolio.

The part I'm not so sure about is the new REIT. Management has said that the new company will be "able to deploy a wide range of strategies, including some not available or practical within HCP." This could mean focusing more on reinvesting capital in the business than paying dividends, at least for the time being.

Sure, REITs have to pay out 90% of their net income, but the HCR ManorCare assets produced a net loss in the fourth quarter of 2015, and could easily do so going forward. Besides, REIT income is best measured by FFO, not net income, which is much lower than the REIT's distributable income.

The Foolish bottom line

Admittedly, the upcoming spinoff creates some uncertainty as to whether or not HCP's 31-year streak of dividend growth will stay alive in 2017. Having said that, I'm confident that the combined dividends of the resulting REITs will be greater than the company's current payout. HCP's strong record of dividend growth is a point of pride for management, and I feel like they'll do everything in their power to keep it alive, even if it means a smaller-than-usual dividend increase.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.