Related closing in on CommonWealth board

Activist shareholders score big win as stockholders vote to remove REIT's trustees

From left: Commonwealth's Barry and Adam Portnoy and Related's Jeff Blau
From left: Commonwealth's Barry and Adam Portnoy and Related's Jeff Blau

Related Companies, along with investment firm Corvex Management LP, is getting closer to ousting the board of office property management trust CommonWealth REIT after a vote from stockholders.

Related was among the major investors spearheading the push to remove the board of trustees.

Sign Up for the undefined Newsletter

A two-thirds majority was required to remove the current slate of trustees. Around  81 percent of the stockholders backed the move. CommonWealth now has until March 25 to have results declared and consents inspected. Related CEO Jeff Blau argued that recent underperformance and conflicts of interest within CommonWealth were a result of the REIT’s ownership of an external management firm.

“The shareholders have exercised their rights and we look forward to working with the trustees in the coming days to arrange for an orderly transition process that best protects the interests of all shareholders,” said Blau and Corvex’s Keith Meister of Corvex and Jeff Blau, who jointly own 9.6 percent of CommonWealth, in a statement provided to Bloomberg News. “We will immediately reach out to the trustees to begin these discussions.”

Sam Zell and David Helfand, both of Equity Group Investments, have said they would head up the new board of trustees if a new board is selected. [Bloomberg News]Mark Maurer