Hong Kong-listed Spring REIT has received a notice of requisition from two substantial unitholders to convene an extraordinary general meeting (EGM), during which a resolution to remove its manager will be tabled.
A copy of the notice of requisition provided to REITsWeek reveal that it has been issued by BT Cayman Ltd and Spirit Cayman Ltd, which are investment vehicles managed by asset management firm PAG Real Estate.
The two investment vehicles collectively hold 157,150,000 units of Spring REIT, which represents a stake of about 12% in the REIT.
“As substantial unitholders of Spring REIT, we have been deeply disappointed with the persistent unit price underperformance, which we feel in part results from the lack of a clear strategy for Spring REIT articulated and executed by Spring Asset Management Limited [the REIT’s manager]”, a paragraph in the requisition letter read.
“In view of Spring REIT’s high quality asset portfolio, consisting of two prime office properties in the Beijing CBD, we believe there is substantial room for improvement in order to narrow the performance gap with comparable REITs”, the letter added.
Besides underperformance, Spring REIT’s governance structure has also been cited by BT Cayman and Spirit Cayman as an area of “significant concern”.