Irish Residential Properties REIT Plc faces a showdown at its annual meeting on Thursday amid investor calls to vote against board resolutions and push for a sale of the company.
(Bloomberg) — Irish Residential Properties REIT Plc faces a showdown at its annual meeting on Thursday amid investor calls to vote against board resolutions and push for a sale of the company.
Vision Capital Corp., which holds about 5% of the stock, has said it will be voting against some of the Irish landlord’s directors and resolutions. It believes the company should consider becoming a private entity, with the shares trading at a “significant discount” to the market value of the firm’s assets as well as to help address needs of the Irish housing market.
Vision has received “substantive” support from both shareholders and institutional investors as well as local Irish property holders who see opportunities “in light of the additional inbalance in the housing market,” the firm’s President and CEO Jeffrey Olin said by telephone. Vision is “hopeful” ahead of the AGM, though the vote “will be close,” he added.
The investor’s next step will be to advance an additional resolution at a further shareholder meeting to require I-Res to look at options to maximize value for shareholders, Olin said. “There’s no reason for it to continue to be held in the public form.”
Vision has also previously said the firm’s largest shareholder, Canadian Apartment Properties REIT, will support its recommendations.
Remuneration Policy
Irish Residential has defended its renumeration policy and said it doesn’t believe a formal sales process is in the best interest of shareholders. It has also said it’s fully compliant with all of its disclosure obligations, after Vision expressed concern following a report the landlord is in talks to sell a central Dublin property to shareholder Irish Life Investment Management.
A person familiar with the matter said while I-Res was approached about selling the Marker Residences, no process is ongoing.
The friction comes amid a protracted housing crisis in Ireland, particularly in the rental sector, where demand far outstrips severely squeezed supply. Prime Minister Leo Varadkar said the current housing deficit amounts to about 250,000 homes due to a rising population as well as the impacts of last decade’s financial crisis.
A spokesperson for I-Res declined to comment beyond the firm’s issued public statements when contacted by Bloomberg News. Capreit didn’t respond to a request for comment.
I-Res saw revenue increase 4.9% in the first quarter of 2023 compared to a year earlier, driven by additions to its portfolio and organic growth, it said on Wednesday. The landlord reported an occupancy rate of over 99% for its properties throughout the quarter, though macroeconomic environment continues to weigh “heavily” on listed real estate company valuations, it added.
Shares of the firm have climbed about 4.6% since Vision’s initial open letter published April 12, compared with a 1% gain in Ireland’s ISEQ All-Share Index.
State Board of Administration of Florida has backed 18 of the I-Res board’s 19 proposals. Fidelity Investments Inc. and APG Asset Management NV will also vote with the board, according to the Times of London.
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