The board of the State's largest private residential landlord has said it does not believe a formal sales process would be in the best interest of its shareholders at this time.
But Irish Residential Properties REIT also said it has identified €100m in non-core assets for disposal and remains open to considering all "value maximising options, including offers for assets or the business as a whole."
The firm's board said it is unanimously recommending that shareholders back all proposed resolutions at the company's upcoming annual general meeting.
It follows an open letter published last week from shareholder Vision Capital which said it plans to vote against the re-election of the firm's chairman and a number of directors at the AGM.
Vision Capital claimed that it had sought explorations around a potential sale of the business, but these had been ignored by the board.
In its response issued to the market this morning, I-RES Reit said it has reviewed Vision Capital’s letter and is reiterating its recommendation to shareholders to vote for all the proposed resolutions.
"The Board has previously stated that it believes the current share price of I-RES does not reflect the value of the Company and is actively engaged in seeking ways to deliver value to shareholders," it said.
"The I-RES share price and wider real estate sector has been impacted by a wide range of macro-economic factors including interest rate hikes, inflation, and geo-political issues," it stated.
"The Irish residential real estate sector has additionally been impacted by regulatory controls with the tightening of rental caps to 2% per annum introduced in December 2021," it said.
It added that despite this challenging backdrop, the company has outperformed the listed European Real Estate sector by 6.4% since the beginning of December of 2021.
I-RES also said that its strategy remains to focus on "operational excellence, disciplined capital investment, prudent balance sheet management and engagement with government to support an effective housing and regulatory environment."
"The company's modern sustainable and diverse portfolio, the resilient performance of the business in 2022, with 6.5% revenue growth achieved, successful internalisation and strong operational and financial results all give the Board confidence in the strategy and in management," it said.
But the company also said that it has identified €100m in non-core assets to sell and will continue to review further disposals to drive value for shareholders.
It added that it would seek to return excess capital to shareholders where appropriate.
"The dividend continues to be an important part of the I-RES investment case and I-RES's REIT status offers a predictable income stream which we recognise is attractive to many of our shareholders," it said.
"The Board regularly reviews all options with advisers, in line with its fiduciary duties, and reiterates that it remains open to considering all value maximising options including offers for assets or the business as a whole," it stated.
"The Board reviewed Vision's written request in 2022 for a formal sales process alongside other value maximising options and has also reviewed this at the current time and concluded that a formal sales process, given the macro-economic challenges and regulatory backdrop, is highly unlikely to result in value maximisation for shareholders," it added.
I-RES also stated that there is no evidence that a formal sales process would be successful in delivering significant upside and such processes are uncertain and disruptive for the business and stakeholders.
It also defended the level of engagement and access it has provided to shareholders and backed its own strategy around remuneration and composition of the board.
Vision Capital holds around 5% of the shares in I-RES Reit.
It had argued that I-RES has increasingly become an "ineffective platform" and that it "continues to poorly address the interests of both its shareholders and the critical needs of the Irish housing market."
Vision also claimed that the company has inefficiencies that hinder it from being a more relevant and viable entity to contribute, in particular, to new and economically viable developments to address the severe housing shortage in Dublin.
