Activist Investor Urges Equity Commonwealth to Liquidate Amidst Acquisition Search

Activist investor Indaba Capital Management has made a bold move by amassing a stake in office real estate investment trust Equity Commonwealth and urging the company to abandon its search for acquisitions in favor of liquidation. In a letter reviewed by Bloomberg News, Indaba, which holds nearly 3% of the trust, criticized Equity Commonwealth’s performance and the board’s lack of execution on acquisitions over the past decade.

The investor pointed out that a year-end deadline to decide between a major acquisition and liquidation could lead to poor decision-making and urged the company to set up a shareholder vote on a prospective liquidation. Indaba’s letter emphasized the importance of incorporating direct shareholder input before pursuing any risky deals.

Equity Commonwealth, based in Chicago, owns office properties in Colorado, Texas, and the District of Columbia. The company has seen its shares fall 6% in the past year, with a market value of about $2.1 billion. Despite this, shares rose 1.6% following the news of Indaba’s stake.

This isn’t the first time Equity Commonwealth has faced pressure from activist investors. In March, Land & Buildings Investment Management, led by Jonathan Litt, also disclosed a 3% stake in the company and pushed for a liquidation to return capital to shareholders.

Indaba Capital, led by former Farallon Capital partner Derek Schrier, has a history of taking stakes in companies and agitating for change. The firm has previously worked with companies like On24 Inc. and Tabula Rasa HealthCare Inc., with Tabula being acquired last year in a $551 million deal.

Representatives for Equity Commonwealth and Indaba Capital declined to comment on the matter, leaving shareholders and industry experts eagerly awaiting the next steps in this high-stakes battle for control.