Meagan Reda Featured in Law360 Q&A Spotlight on Why REITs Should Expect More Shareholder Activism In 2025

Olshan Shareholder Activism partner Meagan Reda was featured in Law360 Q&A spotlight (subscription required) entitled “REITs Should Expect More Shareholder Activism In '25.” Real estate companies, Meagan explains, should expect more shareholder activist campaigns in 2025. Previous campaigns in the sector included fights over conflict-of-interest and self-dealing concerns between REITs and their external managers, as well as calls to liquidate underperforming companies. “This poor corporate governance makes REITs vulnerable to activism,” Meagan notes. “Often we see the CEO or the chairman of the REIT also controlling or serving as the CEO of the external manager — so, very deep-seated and concerning conflicts of interest,” she continued. Meagan commented on several REIT campaigns in 2024 that echoed these issues, noting that concerns are elevated “when you see these excessive management fees being paid amidst a backdrop of continuously poor performance.” Meagan also highlighted the concerning increase in a public company “using litigation to silence its shareholders” during the 2024 proxy season. “It's really a concerning and problematic defense tactic”, she continued. Meagan expects more M&A-related activity in the anticipated more favorable macro-economic environment in 2025 as well as more settlements occurring earlier on in the process. Just because you may not be seeing as many public proxy contests go the distance, does not mean that public companies are not being pressured by activists. “There's a lot behind-the-scenes, private engagement before things are hitting the public, and I think you're seeing this not just in the real estate sector, but across the board,” Meagan noted.