American Residential Properties Inc. is poorly managed and may need new directors to boost the single-family housing landlord’s value for shareholders, activist investor Jonathan Litt said in a regulatory filing Friday.
“Management missteps and lack of effective oversight by the issuer’s board of directors are at the root of the inferior operating performance, inadequate strategic plan and poor total shareholder returns,” Litt’s Land & Buildings Investment Management LLC said in the filing, in which he disclosed a 7.4 percent stake in American Residential.
U.S. single-family rental companies including American Residential have fallen below their initial public offering prices amid concern they haven’t figured out how to profitably operate a pool of geographically dispersed homes for rent. American Residential Chief Executive Officer Stephen Schmitz said in April that while his company hasn’t put itself up for sale, “we do everything to maximize shareholder value.”
American Residential shares closed at $16.71 Friday, down 20 percent from its IPO price of $21 in May 2013.
“If the issuer fails to provide a clear path to improving operational and financial performance, then the reporting persons anticipate nominating director candidates to the board,” Litt said in the filing.