Macys Inc (M)

[Enterprising Investor]

Macy's Taps REIT Expert For Its Board (3/23/16)

Macy's Inc. said Tuesday that it has tapped William Lenehan, an expert in real-estate investment trusts, to become a board member as the company continues to face pressure to spin off its real estate despite ruling out the move last year.

Mr. Lenehan is chief executive of Four Corners Property Trust Inc., a REIT formed last year. He also has held executive roles at a number of other REITs and his experience includes two years as special adviser at Los Angeles-focused Evoq Properties Inc.

Macy's had been under pressure from activist investor Starboard Value LP to get more value out of its vast real-estate holdings, including its famous Herald Square store in New York.

Starboard had pushed Macy's to form a REIT last summer, saying the company's stock could be worth up to $125 a share. Macy's said it wouldn't spin off its property into a REIT but instead would seek joint-venture partners to take minority stakes.

In January, David Einhorn's Greenlight Capital took a stake in Macy's and said it could be a takeover target.

Four Corners, the REIT Mr. Lenehan, 39, currently heads, was established last year after restaurant operator Darden Restaurants Inc. transferred about 430 of its more than 1,500 restaurants to the trust and leased them back. Darden had also been prodded by Starboard.

Terry J. Lundgren, Macy's chairman and chief executive, said Mr. Lenehan would "contribute to our board's expertise and working knowledge on matters related to real estate, an important area of activity as we work to create shareholder value through joint ventures or other partnerships related to Macy's flagship stores and mall properties."

Macy's shares, up 25% in the past three months but down by a third from a year ago, were down less than 1% Tuesday.