American Realty Capital Properties Inc. (ARCP) Chief Executive Officer Nicholas Schorsch will step down as CEO in October and be replaced by President David Kay as part of governance changes at the largest single-tenant landlord.
The change was planned and Schorsch will remain on the board, he said in a letter to shareholders. Also, board members William Kahane and Edward Weil are resigning, leaving the company with five independent directors. Kay “will dedicate a substantial portion of his time as CEO to investor communications,” Schorsch said in the letter, filed today with the U.S. Securities and Exchange Commission.
American Realty Capital Properties has become the biggest U.S. owner of single-tenant properties in less than three years, overtaking Realty Income Corp. (O) American Realty Capital focuses on buildings with only one tenant, such as pharmacies and restaurants. The company’s shares are little changed from their 2011 initial public offering price of $12.50.
“We believe Mr. Kay will be more proactive in talking to investors and improve the company’s financial transparency as he builds out his executive team,” Simon Yarmak, an analyst at Stifel Nicolaus & Co., wrote in a report today. He has a hold rating on American Realty Capital.
The company’s shares rose 3.5% to close at $12.59 today. American Realty Capital raised about $70 million in the IPO, and now has a market value of $11.4 billion.