The Real Deal New York

What really made Vornado’s CEO resign?

March 01, 2013 02:00PM

A columnist for Forbes, Brad Thomas, is speculating that Vornado Realty Trust’s bet on struggling retailer JC Penney is what forced CEO Michael Fascitelli to step down this week.

Fascitelli announced his resignation in an earning call, explaining to analysts that “it’s been an intense 16 years … not all of it has been perfect … not all of it has been fun … it just felt like the right time to change.”

Thomas called Fascitelli’s reasons for leaving “hollow” and classified his comments as “ramblings.”

“Clearly,” Thomas wrote today, “there are problems in the executive suite at the REIT.”

The REIT’s latest earnings results show that Vornado lost $224.9 million on its stake in JC Penney, which contributed to its weak earnings in the fourth quarter. Funds fell to $55.9 million from $280.4 million year-over-year.

Though Vornado is unloading some of its strip mall holdings to offset the damage, the REIT continues to take losses in its JC Penney investment. [Forbes]Zachary Kussin