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Contrite GMH Vows to 'Right the Ship'

NEWTOWN SQUARE, PA-With no firm offers to buy the specialty REIT or its separate divisions, Gary Holloway, CEO, urges shareholders to 'stick with us,' following a 'tough year'.

By Marita Thomas | Updated on December 21, 2006

NEWTOWN SQUARE, PA-During a conference call to discuss plans for continuing operation of GMH Communities Trust, management announced that its special committee did not receive any firm offers to buy the company as a whole or its separate student and military housing divisions. During the committee’s nine-month process of evaluating strategic alternatives, the company said management made presentations to “seven or eight” distinctive prospective buyers.

In elaborating on the initiatives to improve value and performance, announced in a Dec. 18 statement, Gary Holloway Sr., president, chairman and CEO, said the company had identified 25 properties within its 75-property student housing portfolio that it expected to sell or joint venture. “It will come down to between nine and 10 we’ll sell and six or seven to JVs,” he said.

Another nine under performing student housing assets have been identified as “focus properties,” the company intends to fix by fall 2007. Key to the fix is a shift to regional management and better local control. John DeRiggi, who was appointed president of the student housing division five months ago, estimated the total cost at about $2 million in personnel and systems replacement.

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