Vornado’s Roth Ending Silence; Company to Hold Investor Calls

For years, office giant Vornado Retail Trust has eschewed the tradition among listed firms to hold investor conference calls, as its chairman, Steven Roth, opted instead to stay tight-lipped.

Now, with the stock lagging below Mr. Roth’s expectations, the company is switching course.

On Friday, in Mr. Roth’s annual letter to shareholders—something of an institution in the real estate world given his candor and eloquence—the pugnacious executive took an uncharacteristically submissive tone, offering a list of changes to boost confidence in the company.

First on the list: quarterly conference calls, starting after the second quarter. (It should be noted that Vornado, despite its reticence, has been applauded for thorough reporting to investors).

From the letter:

We believe our shares trade at a discount to spot NAV. As troubling, some analysts believe our NAV has recently been growing more slowly than some of our peer’s – undoubtedly a capital allocation/mix of assets issue.

Shareholders and analysts have not been bashful in offering suggestions. Many believe that the value of our great assets/business(es) is masked by…this, that and the other. Everyone suggests conference calls – fair enough.

Among other—and more substantive—reforms Mr. Roth vowed were a move to step up selling of assets considered out of the main business of Vornado, such as some strip malls, and other types of retail.

“We will… reduce our exposure to the enclosed mall business,” he wrote. “We certainly have the expertise to lease, manage and develop mall product, but with only a handful of malls we are in no-man’s land.”

And he acknowledged there would be a big loss of cash flow in a Washington, D.C. office portfolio over the next couple years, due to federal defense spending cutbacks and consolidations. “Damn annoying, but livable,” he described it.

Overall, Mr. Roth sounded a bullish—if cautious— tone, particularly on areas such as Manhattan retail. A recovery, he predicted, will be slower than expected, though headed in the right direction.

“The recovery is inevitable, if only for the reason that the governments of the Free World will make it so,” he said. “Consensus is that the recovery will be shallow and as such, I believe it will be much longer in duration than the three to five to seven year economic cycles that we are used to.”

Fatal error: Uncaught Exception: 12: REST API is deprecated for versions v2.1 and higher (12) thrown in /home4/jdvc/public_html/wp-content/plugins/seo-facebook-comments/facebook/base_facebook.php on line 1273