New York REIT Looks to Remove ARC as Manager
The board of New York REIT Inc. (NYSE: NYRT), a former non-traded real estate investment trust known as American Realty Capital New York Recovery REIT, will be issuing a request for proposals for all interested, qualified parties to serve as the external manager for the company.
The existing management contract between the REIT and New York Recovery Advisors (which is managed by AR Global Investments) is terminable by the company on December 26, 2016 on 60 days prior written notice. The REIT expects that any new management contract would take effect December 27, 2016. Under the terms of the existing contract, there is no termination payment or fees due upon termination of the contract.
“In issuing the [request for proposals] for the management contract of NYRT, the board is demonstrating its commitment to maximize the net distributable proceeds from the proposed plan of liquidation,” said Randolph Read, chairman of the board. “Our board is singularly focused on executing the plan in the most efficient and cost effective manner possible. The board believes that putting the management contract out to bid, for all interested, qualified parties will help produce the most competitive terms from qualified providers for these services.”
New York REIT recently announced its intention to sell its 19-property portfolio after terminating a proposed merger with private real estate firm, JBG Companies. The company canceled the merger amidst a wave of criticism from shareholders, led by Michael Ashner and Steven Witkoff of WW Investors, who are in the process of issuing proxy materials to elect a new slate of directors to oversee the liquidation process.
Debevoise & Plimpton LLP, special counsel to the independent directors of the board, will be assisting the independent directors of the board in the process. Interested qualified parties in the management contract are requested to contact Debevoise.
Shares of NYRT closed at $9.63 on Wednesday.
