The problem with the distribution cut was the timing If REI cut the distribution between March-May like everyone else there wouldn't be so much uproar from shareholders. For those asking if SRU or other REITs will follow REI and cut their distribution? The answer is no. The time for cutting the distribution has long past. I don't believe any REITs have cut since May, but REI does it 7 months later, after all the vaccines have been announced. Does that make any sense? We're on the way to recovery, and the government is paying rent for all affected business' anyways.
I know it's tough to ask yourself the tough questions as shareholders of a company you love and are heavily invested in, but it's in your interest to do so.
As I mentioned earlier, pay close to executive compensation for REI in 2021. If they're using any part of that $150 million to give themselves a pay raise when they're already making millions a year would be wrong and unacceptable. Especially when they're giving shareholders a 33% pay cut. If they do give themselves a raise I would hope the shareholders let REI know how they feel about that.
As for when shareholders will exit after the cut, there are 3 options:
1) Exit the morning after the announcement i.e. last Friday, which wasn't a very good move since everyone was rushing for the exits at the same time.
2) Exit in early January after the last full distribution is paid. We should see another fairly large shareholder exit around then.
3) Exit when the unit price hits around NAV, or around $24. I'm sure many more will exit at that point when the upside potential is limited and the distribution yield remains below average. At this point there's very little reason to hold.