CapLease (LSE) to Reduce Annual Dividend to At Least $0.20/Share

November 26, 2008 9:05 AM EST

CapLease, Inc. (NYSE: LSE) today announced that its Board intends to reduce the Company's annual dividend beginning in 2009 in order to retain cash flow to further reduce leverage through accretive debt repurchases, strengthen the balance sheet and enhance long-term stockholder value.

Therefore, the Board currently expects the Company's 2009 common stock dividend rate to be at least $0.20 per share, which is our projected taxable income for 2009, to be paid $0.05 per share quarterly. The 2009 dividend expectation is subject to the forward-looking and cautionary statements included in this press release.

In addition, due to prior compliance with the minimum REIT payout requirements, the Company will not pay a fourth quarter common stock dividend for 2008. These dividend changes will allow the Company to retain $9.5 million of free cash flow in January 2009 and $28.4 million of additional free cash flow annually, which will be applied primarily to continue to reduce leverage and further strengthen our balance sheet.

Capital Lease Funding, Inc. operates as a real estate investment trust (REIT), focused on financing and investing in commercial real estate that is net leased primarily to single tenants with investment grade or near investment grade credit ratings.

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