Braemar's Self-Management Push
Blackwells Capital Endorses Braemar Self-Management Transition, Challenges Brancous LP1's Campaign
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Blackwells Capital LLC, a shareholder of Braemar Hotels & Resorts Inc., has issued a public statement backing the hotel company's shift to self-management and pushing back against a rival shareholder's aggressive campaign. The firm urged investors to closely evaluate the ongoing pressure campaign by Brancous LP1, which Blackwells views as counterproductive, according to Montreal Gazette.
The statement marks a notable split among Braemar's shareholders. While some investors have raised questions about the company's advisory fees, Blackwells says those concerns have already been addressed. The self-managed real estate investment trust, or REIT, transition is currently underway, and asset sales are also moving forward, Calgary Sun reported.
Blackwells Backs Self-Management as Simpler, Better Structure
Blackwells believes converting Braemar to a self-managed REIT is a major step in the right direction. A self-managed REIT runs its own operations directly, rather than paying an outside adviser to manage the business. Blackwells argues this creates a simpler structure and makes the company more directly accountable to shareholders, according to Fairview Post.
The firm views the advisory arrangement that Braemar currently uses as a key source of shareholder frustration. By eliminating that outside management layer, Blackwells says investors would get clearer oversight of how their money is being used. The transition is already in progress, Cold Lake Sun reported.
Brancous LP1's Public Campaign Draws Sharp Criticism
Blackwells directed pointed criticism at Brancous LP1, urging shareholders to take a hard look at that firm's continued public pressure on Braemar. Blackwells stopped short of calling the campaign harmful, but made clear it believes the aggressive stance does not serve the best interests of investors, according to The Whig.
The statement suggests a divide is forming among Braemar's shareholder base. On one side, Blackwells is signaling support for management's current direction. On the other, Brancous LP1 is keeping up public pressure. How other investors respond could shape the company's next steps, Cochrane Times Post noted.
Zazove Associates Raised Fee Questions Blackwells Says Are Settled
Another Braemar shareholder, Zazove Associates, has also raised questions about the economics of the company's advisory arrangement — specifically whether the fees paid to outside managers are fair to investors. These concerns echo a broader debate about how externally managed REITs compensate their advisers, according to Goderich Signal Star.
Blackwells, however, says those questions have already been answered. The firm did not detail exactly how or when, but its statement suggests it is satisfied with the explanations provided. With the self-management transition underway, Blackwells believes the advisory fee debate will soon become moot, Northern News reported.
Asset Sales Progressing as Braemar Reshapes Its Portfolio
Beyond the management shake-up, Braemar is also selling off assets as part of its broader restructuring. The company has not publicly named which properties are on the block, but the sales are described as actively progressing. Asset disposals can help a hotel REIT raise cash and focus on its strongest properties, according to Chatham Daily News.
Blackwells appears to view both moves — the self-management transition and the asset sales — as complementary steps toward a leaner, more efficient company. The firm's public support gives management a notable endorsement as it navigates pressure from at least two activist shareholders, Ontario Farmer reported.
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