Activist investor pressuring Veris Residential to sell

Multifamily operator Veris Residential is the latest real estate company feeling the heat from an activist investor.

Erez Asset Management, which owns a 5 percent stake in the company, is pushing for Veris to put itself up for sale or undergo a review of strategic alternatives, Reuters reported. Run by former Goldman Sachs banker Bruce Schanzer, Erez is pressing for the move after competitors announced similar plans in recent months.

“We urge you to promptly initiate a comprehensive review of strategic alternatives, accompanied by a public announcement and broad dissemination of the opportunity to all qualified parties,” Schanzer wrote in a December letter addressed to Veris’ board chair and chief executive officer.

Erez estimated “shareholders could realize approximately $22-$25 per share in a sale, after transaction expenses.” That would represent between a 40 percent and 70 percent premium on the $16 per share the stock was trading for on Thursday, when the letter was reported.

Veris has previously dabbled in strategic reviews. Three years ago, it announced plans for a future review, coming on the heels of the company’s rebranding from Mack-Cali Realty and a failed unsolicited takeover bid from Kushner Companies.

The takeover bid quickly turned ugly; at one point, Kushner accused Veris of misleading the public. Kushner ultimately dropped the takeover bid.

At the end of last year, Veris sold the Harborside 8 and 9 development site in Jersey City to Panepinto Properties for $75 million, where the developer plans to build a large-scale residential and retail complex with a total of more than 1,250 residential units across both sites. Veris previously sold six Harborside buildings for a total of $609 million.

Veris sports an enterprise value of $3 billion.

Erez is a prominent investor in real estate circles. Schanzer’s background is in the industry, having run Cedar Realty Trust before the real estate investment trust was sold in 2022.

Two years ago, Erez launched a costly proxy battle with Whitestone REIT; Erez owned 1.3 percent of the Houston-based REIT, a shopping center landlord. It campaigned for shareholders to elect its two candidates, including its founder, to Whitestone’s board of directors. It was ultimately rebuffed.

— Holden Walter-Warner