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American Realty Capital Names Rufrano CEO, Alters Board

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American Realty Capital Properties Inc., the real estate investment trust whose senior leadership resigned after an accounting scandal, named Glenn Rufrano as its chief executive officer and said two directors will leave.

Rufrano, the former CEO of brokerage Cushman & Wakefield Inc., will assume the role on April 1, American Realty Capital Properties, also known as ARCP, said in a statement on Tuesday. He succeeds William Stanley, who had been interim CEO since December and will remain as interim chairman.

“ARCP is a young company, grown rapidly, which now requires a sound business path,” Rufrano said in the statement. “I look forward to meeting the management team, thoroughly analyzing the assets and reviewing the details of the balance sheet while at the same time seeking thoughts from the institutional investor community.”

ARCP executives including Chairman Nicholas Schorsch and CEO David Kay resigned last year after disclosures of accounting errors that were intentionally concealed. The REIT, an owner of more than 4,000 properties across the U.S., has been facing pressure from shareholders including Corvex Management to overhaul its board.

ARCP said Tuesday that two board members, Leslie Michelson and Edward Rendell, plan to step down. The New York-based company is the process of recruiting a new non-executive chairman and two independent directors, resulting in a seven- member board, including Rufrano.

‘Questionable Transactions’

Corvex, which owns 7.8 percent of ARCP’s shares and is led by former Carl Icahn protege Keith Meister, said in a regulatory filing on March 9 that Stanley, Michelson, Rendell and Thomas Andruskevich shouldn’t remain directors because of their “ties with past affiliated entities and leadership” of ARCP or they were on the board “when a number of questionable transactions were approved.”

Rufrano also has led New Plan Excel Realty Trust, acquired in 2007 by the Australian landlord known at the time as Centro Properties Group, as well as Centro. Rufrano most recently was chairman and CEO of O’Connor Capital Partners, an investment firm specializing in retail and multifamily properties which he joined in 2013.

Last week, ARCP filed restated results showing the company understated losses for 2013 and the second quarter of 2014. The company also said equity awards to Schorsch and Brian Block, a former chief financial officer, were larger than a board committee had authorized. Adjusted funds from operations were also overstated for 2011, 2012, 2013 and the first two quarters of 2014, according to a statement from the company.

– With assistance from Oshrat Carmiel in New York.

– Related on ThinkAdvisor: RCS Capital’s Q4 Profits Crash on ARCP Woes

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