James C. Mastandrea Announces Proposal to Replace Whitestone REIT Board After Years of Underperformance

Core Viewpoint - James C. Mastandrea, a significant shareholder of Whitestone REIT, plans to nominate a new slate of independent trustees to replace the current Board of Trustees, citing underperformance and failure to maximize shareholder interests as key reasons for this decision [1][2][3]. Company Performance - Whitestone's stock has produced subpar returns in recent years, with its price fluctuating in the single digits to mid-teens since early 2022, indicating a persistent discount to its net asset value (NAV) [3][4]. - The company has failed to capitalize on favorable market conditions in high-growth areas like Texas and Arizona, leading to a valuation gap attributed to strategic missteps and poor oversight [5][6]. Governance and Management Issues - Concerns regarding the current Board and management include weak share-price performance, modest dividend growth, and an inability to scale the asset base effectively [7][9]. - The management team has overseen a reduction in the number of properties and gross leasable square footage, with the portfolio shrinking from 53 properties and approximately 4.9 million square feet in late 2021 to 50 properties and approximately 4.8 million square feet by late 2025 [6]. - The current management has engaged in costly litigation and mismanaged the balance sheet, including issuing equity below NAV and failing to enhance shareholder value [8][9]. Proposed Changes - Mastandrea intends to nominate six independent trustee candidates with extensive experience in real estate and capital markets to restore accountability and improve the company's strategy [10]. - A refreshed Board and leadership team could potentially close the valuation discount and enhance returns through better oversight and strategic alternatives, including a possible sale or liquidation of properties [11]. Shareholder Engagement - Mastandrea encourages shareholders to review the company's performance since 2021 and looks forward to engaging with them regarding his nominees and strategic plans for the upcoming annual meeting [12].