Hedge Funds Brawl Over Battered Commercial Real Estate

July 24, 2023
The Wall Street Journal

This article in The Wall Street Journal discusses the current downturn in the commercial real estate sector and highlights how distressed investors are particularly focused on real estate investment trusts (REITs) in this environment. 

The article features a dispute involving the top shareholders in a REIT called Diversified Healthcare Trust ("DHC"), which owns senior housing properties and medical office buildings. Among the top shareholders are hedge funds Flat Footed, D.E. Shaw, H/2 Capital Partners and Lonestar who have all publicly opposed a merger between DHC and another ailing REIT, Office Properties Income Trust. In June 2023, Flat Footed filed a proxy statement with the SEC and sent a letter to shareholders in connection with its opposition to the proposed merger. The dispute over the merger remains ongoing.

Herrick partner and Restructuring & Finance Litigation co-chair Sean E. O'Donnell and partner Christopher W. Carty are lead counsel on the matter for Flat Footed LLC. 

Read the full article in The Wall Street Journal here. Access may require subscription