ISS recommends to shareholders of Monmouth Real Estate Investment Corp. to vote “AGAINST” the proposed equity transaction in the Commonwealth



MIAMI – (COMMERCIAL THREAD) – Starwood Real Estate Income Trust, Inc. (“Starwood”), a subsidiary of Starwood Capital Group, a leading global private equity firm focused on real estate and energy investments, commented today on a released report by Institutional Shareholder Services Inc. (“ISS”), a leading independent proxy advisory firm. In its report, ISS recommends that shareholders of Monmouth Real Estate Investment Corp. (NYSE: MNR) (“Monmouth” or “MNR”) to vote “VSMonmouth’s proposed transaction with Equity Commonwealth (“EQC”), which is expected to be voted on at a special meeting of Monmouth shareholders on August 24, 2021.

“We are pleased that ISS recognizes that the value and uncertain benefit of Monmouth’s proposed transaction with EQC makes it inferior to Starwood’s offer. This recommendation is an important step in ensuring that Monmouth shareholders can derive maximum and certain value from our superior offering.

“Starwood’s offer remains superior in value and certainty to any offer that was made during or after the strategic review process. In a letter to Monmouth’s board today, Starwood reaffirmed its net cash offer of $ 18.88 per share and encouraged the board to immediately declare its offer as a “superior proposition” in under the EQC merger agreement.

“Allowing the current transaction to proceed to a vote given the ISS recommendation and the two-thirds approval requirement would unnecessarily delay shareholders from receiving the higher value of the Starwood transaction and expose Monmouth to expense reimbursements. more important to EQC for a transaction that we believe is unlikely to obtain shareholder approval. We are ready to sign the already negotiated merger agreement we provided to Monmouth, which provides shareholders with significantly better value and certainty than EQC’s proposal, and we are resubmitting our cash proposal to the board of administration of Monmouth today to leave no doubt about their freedom. to engage with us under the existing agreement with EQC. We encourage the Monmouth Board of Directors to act in the best interests of the shareholders by immediately declaring the Starwood offer superior and by acting quickly to complete our proposed transaction. ”

The ISS notes in its report that1:

  • “… support is not guaranteed for the proposed project [EQC] operation, in particular in light of the increased value and certainty of Starwood’s proposition. ”

  • “Considering [EQC]the limited presence of industrial real estate and the notable gap between EQC’s recent industrial acquisition history and the billions of dollars in acquisitions that are planned for the combined company, it remains substantial uncertainty as to the ability of the merged company to seize post-trade opportunities presented by the MNR board of directors. ”

  • “In light of the decline in the value of the counterparty and potential execution risk that could limit future returns to shareholders, especially in relation to the value and certainty of the higher competing cash proposition, support for [EQC] the transaction is not justified. ”

  • Absent from the Starwood proposal there would also be a risk of downward rejection due to the possibility that MNR shares would regain a value consistent with their historical relationship with their peers. ”

  • “… Lingering concerns in the minds of shareholders that a preference for a tax-deferred structure over certainty of value could lead to a sub-ideal result… ”

The full text of Starwood’s letter to the Monmouth Board of Directors is incorporated below:

August 6, 2021

Monmouth Real Estate Investment Company

101 Crawfords Corner Road, Suite 1405

Holmdel, New Jersey 07733

Attention: Eugene W. Landy, Chairman of the Board

Dear Eugene:

Today, Institutional Shareholder Services (“ISS”) recommended that shareholders of Monmouth Real Estate Investment Corporation (“Monmouth”) vote against the proposed merger with Equity Commonwealth (“EQC”) at the extraordinary meeting of shareholders of Monmouth scheduled for August 24, 2021 (the “Special Meeting”). The ISS recommendation is in line with our view that Starwood’s all-cash proposal provides greater value and certainty to Monmouth shareholders than a transaction based on the upward speculation of the merger of two entities with no obvious synergies. nor competitive advantages in the industrial sector. Given the required two-thirds support of Monmouth shareholders and the ISS ‘against’ recommendation, the continuation of any vote on the EQC transaction will subject shareholders to further delays in realizing value and unnecessarily forcing Monmouth to $ 10 million in additional expense reimbursements for a transaction with a low probability of being approved.

In light of recent events, Starwood Real Estate Income Trust, Inc. (“Starwood” or “we”) hereby reaffirms, and hereby submits, a proposal to acquire all of the outstanding common shares of Monmouth for a price of $ 19.51 per share. reduced a termination fee owed to EQC of $ 0.63 per share for a net consideration of $ 18.88 per share to Monmouth shareholders. In light of the ISS recommendation and the views of several large shareholders who have publicly and privately expressed their opposition to the EQC transaction, we believe recent events have added further uncertainty to the already weak outlook for complete the EQC transaction. We therefore urge the board of directors of Monmouth to immediately declare our proposal “Superior Proposal” under the existing merger agreement with EQC and to take a path that will deliver certain and maximum value to your shareholders and bring an effective conclusion to this long process without the addition of additional undue costs.

We are ready to sign the merger agreement that was previously submitted to you and complete a transaction on terms that differ from those presented during your comprehensive strategic review process.

Thank you for your continued consideration. We look forward to working with you to achieve the optimal outcome for your shareholders.


Starwood Real Estate Income Trust, Inc.

Christophe graham

Director of Investments

Ethan B. Bing

General director


A vote “AGAINST” the proposed EQC merger on the BLUE proxy card will send a clear message to the board of directors of Monmouth that shareholders prefer the higher value and greater certainty that Starwood offers and that shareholders expect the board of directors of Monmouth to act in their best interest. If the EQC Merger Proposal is not approved, Monmouth will have the right to terminate the EQC Merger Agreement. Starwood also recommends that Monmouth shareholders vote “AGAINST” Proposal 2 (compensation proposal) and Proposal 3 (adjournment proposal) for the reasons described in its definitive proxy circular filed with the SEC on July 30, 2021.

If you have any questions about how to vote your shares, please contact:


Call to shareholders toll free: (877) 750-0625

Banks and collect brokers: (212) 750-5833

About Starwood Capital Group

Starwood Capital Group is a private investment firm focused on global real estate, energy infrastructure, and oil and gas. The firm and its affiliates have 16 offices in seven countries around the world and currently employ approximately 4,000 people. Since its inception in 1991, Starwood Capital Group has raised over $ 60 billion in capital and currently manages approximately $ 90 billion in assets. Through a series of combined opportunity funds and Starwood Real Estate Income Trust, Inc. (SREIT), an unlisted REIT, the company has invested in virtually every category of real estate globally, changing from opportunistically asset classes, geographies and positions. in the capital pile because he perceives that the risk / reward dynamic is changing. Starwood Capital also manages Starwood Property Trust (NYSE: STWD), the largest commercial mortgage real estate investment trust in the United States, which has successfully deployed over $ 69 billion in capital since inception and manages a portfolio of more of $ 18 billion in debt and equity investments. . Over the past 29 years, Starwood Capital Group and its affiliates have successfully executed an investment strategy of building businesses in the private and public markets. Additional information can be found at


1 Permission to use quotes neither requested nor obtained from ISS and emphasis added by Starwood.



Leave A Reply