Headquartered in Newton, MA, CWH is externally managed by RMR.

NEWTON, MA-Now almost a year in progress, the Related Fund Management/Corvex Management LP battle to take over locally based CommonWealth REIT has taken another turn with Related and Corvex formally requesting a record date for a shareholder vote to remove CWH’s entire board. Related and Corvex are urging CWH shareholders to approve a new board to be led by Sam Zell.

In response, CWH, which last week set Feb. 18 as the record date pending receipt of a formal request from Related and Corvex, on Tuesday filed an investor presentation asking for shareholders’ continued support. The consent solicitation by Related and Corvex is to be completed no later than March 20.

“The board and management firmly believe that Related/Corvex’s consent solicitation to remove the entire CWH Board without cause is not in the best interest of shareholders,” says Adam Portnoy, managing trustee and president of CWH. “During the next few weeks, we look forward to discussing with shareholders why the company’s business strategy creates value for all shareholders and why Related/Corvex’s business plan is the wrong path forward for CWH.” Portnoy and his father, Barry Portnoy, are CEO and chairman, respectively, of REIT Management and Research LLC, the external manager of CWH.

For their part, Related and Corvex say in their investor presentation that “change is desperately needed at CWH.” The presentation notes that CWH is among the few remaining externally managed equity REITs in the public markets; in addition to CWH, RMR externally manages a handful of other REITs for which the Portnoys are managing trustees.

RMR has historically received “virtually all of its remuneration through lucrative fee streams rather than an ownership interest in the company,” according to the Related and Corvex investor presentation. Accordingly, Related and Corvex believe that that the external manager is “highly incentivized to manage the company in a way that maximizes such fee income by continuously growing the size of the company, rather than in a manner that creates value for shareholders,” according to the two companies’ investor presentation.

In response, CWH says that its business plan continues to deliver value to shareholders, and that Related and Corvex’s plan for the company is “short-term oriented, reckless and not credible.” The Related/Corvex plans focuses on selling CWH’s best assets and increasing debt leverage, according to the REIT’s presentation.