Activist Investor Pressures Proptech Firm SmartRent to Pursue Sale

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Land & Buildings Investment Management, an investor in proptech firm SmartRent, is urging the company to explore a sale, according to SeekingAlpha. SmartRent’s shares have plummeted 80% from their 2021 highs, and the company is failing to meet growth targets, prompting Land & Buildings’ Chief Investment Officer Jonathan Litt to suggest "strategic alternatives." Litt believes a sale could yield a 150% premium for shareholders, citing CoStar's acquisition of Matterport as an example.

SmartRent acknowledged the letter and stated it will continue discussions with the investor, emphasizing its commitment to shareholder interests. Despite a 22% year-over-year revenue drop in Q1 to $51M, SmartRent's software as a service segment saw a 32% revenue increase. Litt argues this progress is insufficient and calls for a new direction.

Following the letter’s release, SmartRent's shares rose 17.4%. The company, which provides smart home technology across various housing sectors, serves 15 of the top 20 public multifamily operators and operates in over 750,000 units. Land & Buildings, holding a 3% stake in SmartRent, has a history of activist investment, including recent calls for Equity Commonwealth to liquidate its office properties due to poor shareholder returns.

Original article posted on May 14, 2024

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