Simon Property Group (NYSE:SPG) is conserving financial resources by reducing its quarterly dividend. The company's board of directors has declared a new payout of $1.30 per share, which is 38% lower than the $2.10 per share it most recently distributed.

As a real estate investment trust (REIT), Simon is obligated to hand out at least 90% of its net profits as shareholder dividends. But since it is a retail REIT, it has struggled with mandatory store closings around the country, not to mention "stay at home" orders in many locations.

A person cutting a set of U.S. currency bills.

Image source: Getty Images.

The dividend cut was announced within an operational update issued by the company. In that document, Simon took pains to point out that it has around $8.5 billion in liquidity, comprising roughly $3.5 billion in cash, and $5.0 billion available in potential borrowings from a term loan and revolving credit facilities. 

The REIT added that nearly all of its properties have reopened -- 199 out of a total of 204, to be exact. These represent 95% of its overall net operating income. It expects the remaining five properties to reopen in the coming days.

Meanwhile, the company is locked in a legal fight with a would-be acquisition, peer Taubman Centers. The two REITs had agreed to merge in February, but Simon scotched the deal in the wake of the SARS-CoV-2 coronavirus pandemic. Taubman would like to see it consummated. The pair are scheduled to go into mediation on the issue in July.

Simon's upcoming dividend is to be handed out on July 24 to stockholders of record as of July 10. On the latest closing share price, it would yield 7.6%.

On Tuesday, Simon shares inched up by almost 0.4%. That lagged behind the gains of the broader stock market.