New York REIT Inc. (NYSE: NYRT), a former non-traded real estate investment trust known as American Realty Capital New York Recovery REIT, has selected Winthrop REIT Advisors LLC to become its new external advisor. The new advisor will be led by Wendy Silverstein, former executive vice president of Vornado Realty Trust.
As previously reported by The DI Wire in September, the company’s board of directors issued a proposal request for an external manager to replace New York Recovery Advisors, which is managed by AR Global Investments – the successor business to AR Capital.
As part of that process, the board contacted 31 entities to submit proposals and received a total of 14 proposals, and ultimately concluded that the appointment of Winthrop represented the best option to oversee the proposed plan of liquidation, pending stockholder approval, and to maximize value for stockholders.
New York REIT dissident shareholders, Michael Ashner and Steven Witkoff – who own WW Investors LLC, submitted one of the 14 proposals on behalf of their affiliate Winthrop Realty Partners. The pair were outspoken opponents of the now terminated JBG merger and were fighting for control of the board before reaching a settlement with the REIT in October.
“We are excited to have been selected as the new external advisor for NYRT and look forward to working alongside the Board to maximize value for all NYRT stockholders,” said Michael Ashner and Wendy Silverstein. “NYRT has an outstanding portfolio of assets and we are well prepared to work with the board to execute the proposed plan of liquidation as expeditiously as possible, pending approval by NYRT stockholders.”
As part of the Ashner/Witkoff settlement, New York REIT agreed to expand its board to nine directors to include James Hoffmann, Gregory Hughes and Craig Bouchard as new independent directors. The company also said that it would opt out of the Maryland Unsolicited Takeover Act. WW Investors agreed to vote its 1.2 million shares in support of NYRT’s slate of nine director nominees and withdraw its nomination of candidates to stand for election at the annual meeting. New York REIT agreed to reimburse WW Investors’ expenses up to $700,000.
New York REIT extended its advisory agreement with New York Recovery Advisors through March 31, 2017, partly to facilitate a smooth transition to Winthrop, it said. The company can terminate the agreement on three business days’ notice after the later of February 28, 2017 and the filing of NYRT’s 2016 annual report.
After the filing of the annual report, the board expects New York Recovery Advisors to conclude its services, and all other advisory duties will transition to Winthrop. Beginning on January 3rd, Winthrop will advise the company on the previously announced plan of liquidation, and manage all aspects of the proposed plan at the board’s direction.
New York REIT recently announced that it will hold two separate stockholder meetings: an annual meeting to vote on the election of directors and a special meeting to approve NYRT’s proposed plan of liquidation and dissolution.
NYRT will hold the vote on the election of directors on December 30, 2016, and now plans to hold a vote on the plan of liquidation and dissolution on January 3, 2017. Stockholders of record at the close of business on November 10, 2016 will be entitled to vote at the meetings.
In an effort to remove any potential conflicts of interest, William Kahane, a member of the board, recused himself from all deliberations relating to the RFP process.
NYRT is a publicly traded real estate investment trust that owns 19 commercial real estate properties, including office and retail properties, located in New York City. Shares of NYRT closed at $9.75 on Monday.