Michael L. Ashner and Winthrop Strategic Real Estate Fund Issues Letter to New York City REIT Shareholders
JERICHO, N.Y., May 16, 2022 (GLOBE NEWSWIRE) -- Michael L. Ashner on behalf of Winthrop Strategic Real Estate Fund, currently a less than 1% stockholder of New York City REIT, Inc. (NYSE: NYC) (“NYC REIT” or the “Company”), today issued the following statement in response to the open letter the Company to its shareholders on April 28 and May 16 regarding the candidacy of Elizabeth Tuppeny and NYC REIT’s overall performance.
We are saddened by the nonsense NYC REIT and its board members expressed to our fellow shareholders concerning the upcoming contested election between their candidate, Elizabeth Tuppeny, and Comrit’s candidate, Sharon Stern particularly as to the Company’s past performance. As to the Company’s recent performance:
The trading price of the stock is less than $10.00, a discount or loss of 61% to the stock’s book value of $25.84 per share. That loss represents the true performance of the NYC board of directors over the term of their incumbency.
In 2021, the Company had a cash loss of close to ($8 million) but paid the external advisor close to $25 million in fees and reimbursements. This quarter, the Company generated a meager $2.7 million in operating cash flow while paying its external advisor almost $6.5 million in fees and reimbursements. Talk about feeding at the trough.
Four of the Company’s eight properties are currently in some form of financial work out due to breached covenants under their respective loan agreements.
The disparity in the $25.84 book value and $10 share price means that any equity issuance would be highly dilutive to you as shareholders. No meaningful plan has been suggested by the board to address this pending crisis.
As to the board itself, almost all of the board members serve as board members of other companies controlled by Nick Schorsch, who is the beneficiary of these enormous and abusive external advisory fees. Elizabeth Tuppeny is one of these directors who serves at the behest of Nick Schorsch and Nick Schorsch affiliated entities.
Sharon Stern, to her credit, would be a much needed, truly independent director. Ms. Stern was in large measure responsible for the ultimate sale of Cedar Realty Trust (“Cedar”) which sale provided Cedar shareholders a 22% gain over the prevailing stock price. Since joining the board in April 2021, shares of Cedar have increased 76%.
We see no alternative. The current board continues to only serve Nick Schorsch related entities to the disadvantage and loss to NYC REIT shareholders, a practice that has continued for too many years. Their misplaced loyalty has led to a startling loss in both book value and real value with no plan to prevent further losses. We are decidedly voting in favor of Sharon Stern as we see no other means to effectuate any reasonable change here.
We urge shareholders to vote on the WHITE proxy card to elect Sharon Stern, a highly qualified and independent director candidate, at the Company’s upcoming Annual Meeting of Stockholders on May 31, 2022.
About Winthrop Strategic Real Estate Fund
Winthrop Strategic Real Estate Fund is a private equity and debt investment fund focusing on distressed real estate opportunities and real estate securities investments.
Contact: Michael L. Ashner
Investor or Media Inquiries Phone: (516) 822-0022; e-mail: mashner@winthropcapital.com
