Spanish real estate group Colonial expects its dividend per share to increase by 8% to 10% in the future, it told a shareholders' meeting on Thursday.

The company said it will pay a dividend of €0.27 per share on June 21, an 8% increase from its previous payout of €0.25 per share.

The firm said the dividend increase policy responds to the strength of earnings in 2023, based on trading volume and growth in occupancy and rents.

Rising interest rates took their toll on real estate in 2023 as asset valuations fell, although Colonial's first-quarter net profit doubled from a year earlier, supported by inflation-linked rental income and high occupancy rates.

The company expects upcoming interest rate cuts by the European Central Bank to slow the decline in its asset valuations.

"Inflation is coming under control, but it is dragging a bit, which is delaying rate cut expectations. Green shoots are appearing," Colonial chairman Juan José Brugera told a conference call.

(Reporting by Matteo Allievi; editing by Bernadette Baum; Spanish editing by Benjamín Mejías Valencia)