"For a long time nobody thought a REIT could be successfully attacked, so nobody bothered," says Darren Novak, whose firm advises companies and activist investors. "If CommonWealth (CWH) falls, that perception will change."
Activist battles and hostile takeovers in REITs are rare, write the WSJ's Robbie Whelan and Liz Hoffman, partly because of tax rules and corporate charters preventing any one investor from owning more than roughly 10% of a company's shares. Plus, REITs typically have hefty dividends, robbing activists of a typical complaint of not enough cash being returned to shareholders. Add to that the fact that REITs usually trade near book value, making it hard to argue about unlocking hidden value.
If Corvex and Related are successful in tossing out CommonWealth REITs board and management, who might be the next target? Quickly coming to mind are Senior Housing Properties Trust (SNH), Government Property Trust (GOV), Select Income REIT (SIR), and Hospitality Properties Trust (HPT) - all also managed by the Portnoy's RMR.
See also: Phil Goldstein's Bulldog Investors successfully pushes for faster buybacks at Javelin Mortgage.