REITWise Panel Explores Drivers of REIT Shareholder Activism

Mark Parrell, executive vice president and chief financial officer with Equity Residential (NYSE: EQR), joined REIT.com for a video interview at REITWise 2017: NAREIT’s Law, Accounting & Finance Conference in La Quinta, California.

Parrell moderated a REITWise panel on investor activism.

Some of the key points to emerge from the session included the need for REIT management boards to be “their own best critics”and to communicate regularly with investors, Parrell said. He noted that the REIT industry is already ahead of other sectors when it comes to communication.

“In the REIT industry generally, you have a pretty good pulse on what a lot of your investors are thinking,” Parrell said.

Parrell also commented that in the past, activism in the REIT sector was restricted due to the size of the industry and its tax rules.

“That’s changed. That trend is certainly upward in terms of activism in our area,” he said.

Meanwhile, Parrell stressed the need for “direct, candid and positive conversation” with activists, both in public and in private. He added that REITs should also try to determine whether activist viewpoints are shared by a broader swath of the company’s investor base.