Cove Partners Issues Statement in Response to American Realty Capital New York City REIT's Unilateral Decision to Classify the Board

NEW YORK, Oct. 16, 2017 /PRNewswire/ -- Cove Partners III LLC, a shareholder of American Realty Capital New York City REIT, Inc. ("ARC-NYRT" or the "Company"), issued a statement today in response to the Board of Directors' (the "Board") adopting a resolution on October 9, 2017 to classify the Board so that all directors will be subject to election over a staggered three-year period.  This self-serving action appears to have promptly followed the preliminary voting results from the Company's adjourned September 7^th annual meeting of shareholders, which revealed that shareholders failed to approve the Board's anti-shareholder proposals to amend the Charter for the second year in a row. Cove Partners had urged shareholders to vote against these shareholder-unfriendly Charter amendments given its belief that they eliminated valuable shareholder protections and opened the door for unfettered control by the Company's external advisor.

Michael Ashner of Cove Partners stated, "Hardly surprising that a Board handpicked by its external advisor would entrench itself following the repeated rejection of its proposals by its shareholders. After losing, by their own admission, at least $135 million of shareholder value during their tenure, we believe the Board members' undoubtedly saw no other means of keeping their lucrative jobs and preserving for Nick Schorsch, who oversaw their appointment to the Board and other similar positions, his lucrative fees."

Mr. Ashner added, "Hindering shareholders from removing an incompetent and self-interested Board through staggered elections was apparently the only means available of achieving their self-serving ends. It seems quite clear to us that this Board looks to the Central Asian republics for guidance on corporate governance rather than the American publicly traded REIT trend toward Board declassification. What's next, appointment of their children to serve as their successors? The Board's actions to date solidify our belief that it cannot be trusted to lead the Company and act in the best interest of shareholders."

About Cove Partners III LLC
Cove Partners III LLC is a private company which invests in real-estate companies.

Contacts:
Cove Partners III LLC
Michael Ashner, [email protected]
John Alba, [email protected]
516-822-0022

SOURCE Cove Partners III LLC