IStar to skip third-quarter dividend payment

REITs are required to pay out 90 percent of their annual taxable income to common shareholders. IStar Financial typically pays out its entire taxable income as a dividend.

For 2008, iStar Financial has already paid out $1.74 per share in dividends and will pay out the balance of taxable income during the fourth quarter.

The move to skip the third-quarter dividend reflects the ongoing credit crisis and its effect the financial sector, the company said in a statement.

Shares of iStar fell 41 cents, or 17 percent, to $1.99 in morning trading.