Search
 

Litt Pushes Taubman to Cut Costs or Sell

STAMFORD, CT—“We are done listening to excuses from the Taubman family for the company's undervaluation and inferior operating performance,” Land and Buildings' Jonathan Litt writes in a letter to Taubman Centers' independent directors.

By Paul Bubny | Updated on October 19, 2016
Mall at Short Hills entrance The Mall at Short Hills is one of 22 US properties owned and operated by Taubman Centers.

STAMFORD, CT—Activist investor Jonathan Litt is pushing for change at mall REIT Taubman Centers, urging it to consider strategic alternatives including a management-led privatization or a sale of the company to a third party. In a letter to the Bloomfield Hills, MI-based REIT’s independent directors, made public on Wednesday, the founder and CIO of Land and Buildings Investment Management cites Taubman’s “drastic discount to NAV, inferior margins, poor capital allocation and horrible corporate governance practices” despite owning “the most productive class A malls available to the investing public.”

In his letter, Litt notes that he has held “countless discussions” with Taubman management over the years, going back as far as his days covering the REIT as an analyst. “After decades of voicing our concerns to management we are done listening to excuses from the Taubman family for the company’s undervaluation and inferior operating performance,” he writes.

He sees “tremendous opportunity” to reverse “decades of poor stewardship” and allow the company’s stock to reach its net asset value of $106 per share, or approximately 50% upside from current levels. “We estimate fair value is closer to $144 per share, or approximately 100% upside from current levels, which is achievable through improved operations and margins, superior capital allocation and shareholder-friendly corporate governance enhancements,” writes Litt.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.