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Home / News / Decision day at I-RES as board faces crunch EGM votes

Decision day at I-RES as board faces crunch EGM votes

The board of Ireland’s largest private residential landlord, I-RES REIT, will face a crunch extraordinary general meeting (EGM) later this morning which could decide the future direction of the company and the involvement of a number of existing directors in it.

Shareholders of the business are being asked to vote on proposals to remove and replace five directors on the board.

They will also cast ballots on whether to accept a resolution that proposes a sale or the breakup of the company.

The motions have been tabled by Vision Capital, a Canadian based property investment company that holds 5% of the shares in I-RES REIT.

It is unhappy with the performance of the firm, which controls 3,734 residential units – mostly in Dublin – because its share price does not reflect the underlying market value of its assets.

It is also frustrated with what it sees are inefficiencies and limitations in the Real Estate Investment Trust (REIT) model in Ireland.

REITs are tax efficient structures introduced by the Government in 2013 to help attract fresh investment capital into the property market.

Explainer: The battle for control of Ireland’s largest private residential landlord

Vision Capital is also critical of members of the I-RES REIT senior management and board.

Among those that it wishes to oust are I-RES’s chairman Declan Moylan, its chief executive officer Margaret Sweeney, chief financial officer Brian Fagan, and board members Joan Garahy and Tom Kavanagh.

Its special resolution, if passed, would require I-RES to proceed with a strategy that results in either the privatisation of the business or the sale of its assets either all together or gradually over the course of two years.

Over recent weeks, since Vision announced plans to seek an EGM in December, I-RES’s board has been strongly defending its performance.

It has argued that Vision’s approach would seriously risk the value inherent in the assets and the platform.

It has said it will carry out its own strategic review of the company’s options, including new initiatives, consolidation, combinations, mergers, a review of the Company’s status as a listed REIT, a sale of the entire company or selling assets and returning value to shareholders.

Vision Capital is backed by the founder of I-RES REIT, Canadian based Capreit, which owns 18.5% of the company.

In order for its resolutions proposing the removal and replacement of directors to succeed, Vision must secure 50% of the vote.

However, for its resolution on the strategic direction of the business to pass, it must meet the higher bar of securing 75% of the poll.

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