Bill Moss, who founded Macquarie Group Ltd.’s property unit before leaving in 2007, is seeking a return to one of the real estate trusts he helped create with a bid to take control of Charter Hall Office REIT.
Moss, who has muscular dystrophy, focused on philanthropic work after expanding Sydney-based Macquarie’s property and banking unit from a staff of two in 1984 to more than 1,600 employees overseeing A$23 billion ($24.5 billion) of assets. He set up advisory and fund management firm Moss Capital in 2009.
Three hedge funds with stakes in Charter Hall Office last month said they want Moss to take over management of the REIT to replace Charter Hall Group, which they say hasn’t acted in the best interests of shareholders. Moss agreed and has pledged lower management fees and said he’ll mull Australian asset sales and a share buyback if voted as manager of the Sydney-based trust.
“I got very interested when I heard the story of how the unit holders didn’t have a say, and I didn’t agree with that,” Moss, 55, said in an interview in Sydney. “There are a lot of things that should change with respect to corporate governance. This industry is ripe for change.”
The hedge funds -- Orange Capital LLC, Luxor Capital Group LP and Point Lobos Capital LLC -- have called for an investor meeting around July 27 to vote on management of the Office REIT. They own a combined 19 percent, according to Bloomberg data.
Macquarie, Australia’s biggest investment bank, agreed to sell the management rights and stakes in its real estate funds to Charter Hall in February 2010 as it severed ties to some of its listed funds. Charter Hall last year proposed selling half of the office REIT’s U.S. properties into a joint venture it would manage, before abandoning the plan and seeking buyers for all the assets.
“Shareholders never had a say when Macquarie sold the management rights to Charter Hall,” Moss said. “And when an attempt was made to sell U.S. assets to a Charter Hall-related entity, they again didn’t have a say.”
Charter Hall’s independent directors have rejected Moss’s assertion and urged Charter Hall Office REIT shareholders to vote against a change of management. The group this week said it will conduct a corporate governance and fee review for the Charter Hall office and retail REITs.
Moss Capital, which now has 20 staff, plans to double in size and would consider expanding outside Australia if investment opportunities arise, Moss said.
“After I’d been out of the market for some time, I realized the corporate contacts you have disappear very quickly when you leave the top tier,” Moss said.
Moss left Macquarie with a A$40 million payout, the Sydney Morning Herald reported on Aug. 21, 2010. Moss declined to comment on the payout. Moss, who suffers from facio-scapulo-humeral dystrophy, donates all his salary to charity and offers his services free to anyone who helps his FSHD Global Research Foundation, a non-profit organization that funds medical research on the condition, he said.
Moss said he realized something was not right with his body when he went from the fastest runner in his school to the slowest by age 12, and developed difficulties catching a ball and getting up after a tackle during sports. When he was diagnosed, a neurologist told him he would be in a wheelchair by age 50. Moss credits the fact that he has defied that prediction to his determination.
“When you’ve got a disease that’s slow and aggressive, it forces you to adapt in different ways,” he said. “When I found out I had it, I worked out that whatever I was going to be by the age of 50, I had to be by the age of 40. ”
Moss is working on a book, titled “Still Walking,” which he calls his “half-time report” about his experiences at Macquarie and the funds management industry. He aims to release it by the end of the year, he said.
The move to replace Charter Hall is the first foray by Moss Capital into managing a listed property trust. Moss now runs unlisted property, solar and debt funds and manages syndicates for clients.