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Real Estate News & Analysis: May Edition


Taubman tussles; Granite stands its ground

S&P Global Market Intelligence offers our top picks of U.S. real estate news stories and more published throughout the week. Please note that some entries may have links to third-party sources that may require a subscription.

Active activists

* Taubman Centers Inc.'s entire board slate was elected this week following a proxy fight with activist shareholder Land & Buildings Investment Management LLC. The vote came two days after Taubman said it would de-stagger its board and transition to annual director elections.

Following the vote, Land & Buildings said it plans to continue to pursue its legal complaint seeking declaratory and injunctive relief against Taubman, saying the main reason the real estate investment trust's director nominees were elected was the 30% voting interest of the Taubman family.

* Granite REIT asked its unit holders to vote only for the election of its director nominees as a way to shield their investment from FrontFour Capital and Sandpiper Group. The dissident unit holders recently proposed three independent directors as they pressed for leadership change at the Canadian REIT.

* Meanwhile, Michael Ashner and John Alba's Cove Partners III LLC is taking issue with American Realty Capital New York City REIT Inc.'s charter amendment proposals, which it views as "shareholder-unfriendly." Among other things, the activist shareholder drew attention to a proposal that would give the board the power to indefinitely extend the contract of the REIT's external adviser, which is controlled by nontraded-REIT veteran Nick Schorsch. The proposals will be up for a shareholder vote at a June 27 meeting.

Hotels in play

* American Hotel Income Properties REIT LP struck a roughly US$407.4 million deal to buy a portfolio of 18 Marriott and Hilton hotels across the U.S. The company will fund the transaction in part with proceeds from an offering of limited partnership units and debentures.

* Xenia Hotels & Resorts Inc. paid $205.5 million to buy an 815-room hotel in Orlando, Fla. The seller was an affiliate of Hyatt Hotels Corp.

Go West

* Blackstone Group LP picked up three apartment complexes in the Las Vegas Valley for $170 million, according to the Las Vegas Review-Journal. The properties contain 972 units and were sold by Nevada West Partners developer Martin Egbert.

* In Houston, Whitestone REIT purchased an urban mixed-use center and about 1.4 acres of land that can be used for further development. The company partially funded the roughly $158.0 million transaction with $80.0 million in mortgage financing.

Nailing it down

* MVP REIT Inc. and MVP REIT II Inc. announced definitive merger plans this week. Under the deal, each MVP REIT stockholder will receive 0.365 share of MVP REIT II common stock.

* New York REIT closed its purchase of an additional 49.9% equity interest in Worldwide Plaza in Manhattan, N.Y., for roughly $276.7 million. The deal gives the company 98.8% ownership and positions it for the next phase of its liquidation process, New York REIT CEO Wendy Silverstein said in a release.

Dividend decisions

* American Tower Corp. increased its quarterly cash distribution to 64 cents per common share from 62 cents per share. Separately, the company and fellow tower REIT Crown Castle International Corp. were rumored to be potential acquirers of Spanish tower operator Cellnex Telecom SA.

* CoreSite Realty Corp. raised its cash dividend for the second quarter by 12.5% to 90 cents per common share.

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