they have an experienced management team that costs a pretty penny.
Part of the bear case is that EQC exists to take care of Zell's trusted consiglieri so I don't fully understand the pushback on key man risk being particularly high here.
they have overbuilt the company. it's just as developed/experienced as, if not more so than many SPACs and opportunistic PE funds (the relevant comps) or some dude buying portfolios for a distressed credit fund / multistrat fund.
the same DNA that built EQR, ELS, and top ticked EOP, is there and I'd argue it's more than Sam Zell, but i guess that's what makes a market. I doubt Zell is the one actually doing all the work, and probably hasn't been doing the nitty gritty for decades. Do I like EQC with his wisdom more than without. yes, absolutely.
i think this management team deserves trust. since they've taken over, they've done nothing but sell assets at or above NAV, return capital to shareholders, and patiently wait for something. They were rumored buyers of FCE (and in fact bought the stock on the open market), but BAM beat them out. We know with hindsight that would have been a home run because BAM has since exited FCE's life science portfolio at a ginormous markup. They have been a seller of assets since 2014 and the office REIT index has returned 0-2% since then depending on when you start generally, again depending on where you start EQC has returned mid single digits, in line with REIT index, all while going from levered to a cash pile. did i expect better, surely! but anyone who's just bought and held EQC since 2013 (without trading around or having realistic expectations*) would deserve their mid single digit return and hasn't been paying enough attention. they never set a timeline and have been pretty transparent throughout.
the opportunity cost of carrying this in a zero interest rate environment is quite low (unless you have an absolute no margin policy or something like that). it's a publicly traded real estate opportunity fund where you have to pay the commitment upfront; in exchange for that, there's better economics (vs paying on committed capital + incentive fee etc) and one click liquidity.
feel free to peruse the proxy
https://www.bamsec.com/filing/114036120009688?cik=803649or read the bios
https://www.egizell.com/people/or read about their other investments
https://www.egizell.com/portfolio/*read the progression of the thread, many opportunities to size up/down or get in/out entirely along the way.