Ventas Chairman and CEO Debra Cafaro on Tuesday challenged allegations made a day earlier by Land & Buildings Investment Management as the activist shareholder called into question the Chicago-based real estate investment trust’s recent financial performance and called for a change in board membership.
Land & Buildings owns approximately $50 million worth of shares in the Chicago-based real estate investment trust, amounting to a stake of less than 1%, according to the Wall Street Journal.
“We have a really outstanding board at Ventas, as most of you know, because they do outreach regularly with our shareholders,” Cafaro said during a webcast at the BofA Securities 2023 Global Real Estate Conference on Tuesday.
Land & Buildings founder and Chief Investment Officer Jonathan Litt, in a public letter issued Monday, called for “substantial change” at Ventas but said that his company is open to continuing discussions with Ventas over what it considers to be the REIT’s shortcomings.
According to Cafaro, however, the REIT has had no discussions with Land & Buildings. “They have not reached out to us for over a year,” she said.
“But, you know, we are very interested in performance. There’s nobody in the world more interested in outperformance and value creation than the people you see here at this table, and that’s really what we’re focused on,” Cafaro added. “And we are, as all of you know, very engaged with our shareholders and very interested in their feedback. And very, again, what we care about is performance and value creation.”
Among the senior living operators in Ventas’ portfolio are Atria Senior Living, Discovery Senior Living, Priority Life Care, Sodalis Senior Living and Sunrise Senior Living. Outside of its seniors housing operating portfolio, Brookdale Senior Living is one of the REIT’s largest tenants.
In a presentation released in conjunction with the webcast, Ventas noted that multiyear senior housing recovery is underway and gaining strength. In general, the REIT noted robust liquidity with $3.3 billion of near-term liquidity among all of its properties.
In her presentation, Cafaro said that she would expect real estate transactions to pick up by the fourth quarter of this year and into early 2024.
“And that’s going to be driven, I think, somewhat by reality checks and maturities. You know, there’s a trillion and a half of real estate maturities coming over the next couple of years, and that will drive the reality check and the transaction volume, in my opinion, to people who can raise capital and deploy capital, like us,” she said.
This isn’t the first time Litt has challenged the REIT’s management and board of directors. In an April letter to shareholders, he announced his intention to vote against the election of lead independent Director James Shelton and Board Chair Cafaro, the two longest-serving directors, at the REIT’s annual shareholders meeting May 16.
Also, in March 2022, Land & Buildings accused Ventas of “long-term underperformance” and announced Litt’s own nominations to the board of directors, but that nomination was withdrawn a month later.
Land & Buildings also has challenged Brookdale Senior Living’s decisions in the past.
