In the latest installment of the Grubb & Ellis Co. boardroom fight, former chairman Tony Thompson has nominated himself and a pair of heavy hitters for the board of the Santa Ana-based real estate brokerage and investor.
Thompson, who is Grubb & Ellis’ second-largest shareholder and chairman of upstart real estate investor Thompson National Properties of Irvine, has nominated himself, Harold Ellis and Stuart Tanz for the company’s board, which currently counts eight members.
Ellis cofounded Grubb & Ellis in 1958 and served as chairman and chief executive until 1992. Stuart Tanz is the former chairman and chief executive of San Diego-based Pan Pacific Retail Properties Inc., now part of Kimco Realty Corp.
Grubb & Ellis’ existing board opposes the proposed board candidates, who seek to push the company to enact a series of aggressive, less conventional strategies that could help it better capitalize on the ongoing weakness in the real estate and credit markets, Thompson said.
Grubb & Ellis shareholders are scheduled to vote on the board matter in early December.
The boardroom drama comes as Grubb & Ellis,which has seen its stock price fall by nearly 80% during the past year,reported a tough third quarter this week, posting a net loss of $44 million due in large part to impairment charges related to property the company owns and is looking to sell.
It also announced it was letting go of about 100 of its nearly 900 brokers across the U.S.
Interim Chief Executive Gary Hunt said this week it’s the most challenging real estate market he’s seen in nearly 30 years, but that the company was performing well.
Thompson describes the commercial real estate market these days as “hand to hand combat,” and believes aggressive new strategies are needed to turn the company around.
“Tried and proven methods aren’t working,” he said.
He’s recommending a number of initiatives for Grubb & Ellis, including the creation of a consulting and appraisal businesses, a re-tooled investment management division, a new debt acquisition business and broker retention initiatives, among other suggestions.
For more on this story, read the Nov. 10 issue of the Business Journal.
