MCB Real Estate has increased its offer to acquire Whitestone Real Estate Investment Trust, a Houston-based REIT, and is warning of possible boardroom changes if the deal does not move forward.
In a letter dated November 4 to shareholders, MCB Real Estate, headquartered in Baltimore, proposed to buy Whitestone for $15.20 per share in cash. This values the transaction at about $1.42 billion including debt. The new bid represents a 21 percent premium over Whitestone’s closing price of $12.56 on November 3 and follows two earlier offers that were rejected: one at $14 per share in June 2024 and another at $15 per share in October last year. After the announcement of the latest proposal, Whitestone shares rose more than 4 percent to close at $13.11 on Monday.
MCB currently owns approximately 9.2 percent of Whitestone’s stock and has secured a letter from Wells Fargo expressing confidence that it can raise up to $950 million in debt financing for the acquisition. David Bramble, co-founder and managing partner of MCB, stated:
“Absent constructive engagement toward a transaction or the initiation of a public strategic alternatives process, we intend at a minimum to vote against the entire Whitestone Board at the next Annual Meeting of Shareholders,” Bramble wrote, calling on other investors to do the same.
Whitestone has not responded publicly to this latest offer. The company owns 55 open-air shopping centers across Texas and Arizona with assets valued above $1 billion, including Blvd Place near Houston’s Galleria district.
MCB has criticized Whitestone for what it describes as ongoing underperformance and weak governance since its initial bid last summer. Despite reporting better-than-expected third-quarter results—26 cents in core funds from operations per share and revenue of $41 million—Whitestone’s stock remains down more than 10 percent so far this year.
If Whitestone rejects this new proposal, MCB may pursue a proxy battle next year when nominations for board candidates open between December 5 and January 4. This would be the third activist challenge faced by Whitestone in as many years; previous attempts included efforts by Ezra Asset Management in 2024 and another dissident investor before that.
The largest shareholders in Whitestone are BlackRock with a stake of 15.2 percent and Vanguard with 10.9 percent; neither has commented publicly on MCB’s latest move.
