FrontFour Capital seeks representation at Granite

Bloomberg

FrontFour Capital Group is seeking board representation at Granite Real Estate Investment Trust arguing that the company is underperforming peers after failing to use its balance sheet efficiently to make acquisitions, a document obtained by Bloomberg shows.
The Connecticut-based activist investor said Granite has the capacity to spend as much as C$1 billion on new purchases, according to the document, which is expected to be filed with regulators on Monday. Granite could be worth C$60 a share if it leveraged its balance sheet in line with peers, the document from FrontFour and Vancouver-based Sandpiper Group shows. Shares closed at C$50.84 each Friday.
The Toronto-based company’s net debt to enterprise value of about 17 percent is well below an average of about 45 percent for other Canadian commercial REITs, meaning it has the potential to
add properties, according to the
investors. They aim to nominate independent trustees with “considerable real estate experience, and
a focus on unlocking value for
all unitholders.”