Nicholas Schorsch, whose spectacular Manhattan real estate acquisition spree came to an abrupt halt in October after an accounting scandal, has resigned as executive chairman of American Realty Capital Properties, the firm announced today.
ARCP’s chief executive David Kay also resigned, along with Lisa Benson, the firm’s president and chief operating officer.
On Oct. 29, management at the real estate investment trust revealed that it found accounting errors in the company’s public filings that were intentionally concealed. The fallout from that scandal – which is also reportedly being investigated by the Securities and Exchange Commission — has seen the firm’s stock price tumble more than 35 percent this year.
“The actions taken today will stabilize the company and are necessary to strengthen future leadership and strategy, improve governance, and complete a separation from Nick Schorsch and his affiliates,” ARCP’s acting CEO and chairman William Stanley Stanley said in a statement. New York REIT, one of the real estate investment trusts sponsored by American Realty, raised $1.7 billion from investors just prior to a stock exchange listing in April, as The Real Deal reported.
The REIT’s big Manhattan buys include the $528.6 million acquisition of an office tower at 1440 Broadway and a 48.9 percent stake in the 59-story, 1.8 million-square-foot tower known as Worldwide Plaza.
Schorsch will continue to head investment firm AR Capital, a sponsor of nontraded REITs, as chairman and CEO, that company said in a separate statement.