Land & Buildings Responds to First Industrial’s Latest Shareholder Letter Ahead of April 30 Annual Meeting

Key Terms

implied cap rate financial

The implied cap rate is a way to estimate how much income a property is expected to generate relative to its current value. Think of it like a return on investment, similar to how a savings account offers interest; a higher rate suggests a potentially better income yield. Investors use this measure to compare different properties and gauge whether a property is priced fairly based on its expected income.

total shareholder return financial

Total shareholder return is the overall gain an investor gets from owning a stock, combining changes in the share price plus any cash payouts like dividends, and assuming those payouts are reinvested in more shares. Investors use it like a single score that shows the true return on their investment—similar to checking both the growth of a savings account and the interest earned—to compare how well different companies or investments perform over time.

msci us reit index financial

The MSCI US REIT Index is a market benchmark that tracks the performance of publicly traded U.S. real estate investment trusts (REITs), which are companies that own and operate income-producing property and distribute rental income to shareholders. Investors use it like a scoreboard or thermometer to assess how the U.S. real estate sector is performing, compare funds or portfolios, and judge sector risk, return and diversification within a broader investment mix.

nav financial

Net asset value (NAV) is the total value of all the investments and assets in a fund or company, minus any debts or liabilities, divided by the number of shares or units outstanding. It represents the per-share worth, giving investors an idea of what each share is truly worth based on the underlying assets. Think of it like a company's total worth divided among its shares, helping investors assess whether a share is fairly priced.

nareit funds from operations (ffo) financial

Nareit Funds From Operations (FFO) is a standard measure of a real estate investment trust’s operating performance that adjusts net income by removing profits or losses from property sales and adding back non‑cash building depreciation and specified items per Nareit rules. Think of it like looking at a household’s monthly cash flow after ignoring one‑time house sales and adding back accounting charges for wear‑and‑tear; investors use it to compare the regular cash‑generating ability of different REITs without distortions from sales or non‑cash accounting entries.

same store net operating income (ss noi) financial

Same store net operating income (SS NOI) measures the profit a business generates from the same group of stores or properties over a set comparison period, calculated as revenue minus the costs of running those locations. It tells investors how well existing operations are doing without the noise of new openings, closures or property sales—like comparing the performance of the same apples in two harvests to see if the farm is becoming more productive.

exempt solicitation regulatory

An exempt solicitation is a request for shareholder votes or support that is allowed to be distributed without following the full, formal proxy filing process required by securities regulators. Think of it like handing out flyers at a meeting instead of running a fully registered ad campaign: it’s a quicker, lower‑burden way for a party to persuade investors, but it can still influence corporate control or decisions, so investors should note who is behind it and assess possible bias or incomplete information.

universal proxy card regulatory

A universal proxy card is a single voting ballot sent to shareholders that lists every director nominee put forward by both the existing board and any challengers, allowing investors to pick any mix of candidates they prefer. Like a combined ballot at a community election, it makes voting easier, increases individual shareholder control, and can materially change the dynamics, cost and likely outcome of contested board elections.

Believes FR’s Own Letter Reinforces L&B’s Core Thesis: A High-Quality Portfolio Trades at a Persistent Discount Due to Governance Failures

Notes That FR’s Updated TSR Tables Now Include the Activism Premium Generated by L&B’s Campaign, Undermining the Board’s Claims of Organic Outperformance

Highlights That Every Concession FR Has Made Since December 2025 – Buyback, Dividend Increase, New Director, Property Tours – Occurred Only After L&B’s Public Pressure

Calls on Fellow Shareholders to Vote Against the Reelection of Chairman Matt Dominski and Director H. Patrick Hackett, Jr. – the Two Longest-Tenured Directors on the Board – at the Upcoming Annual Meeting

STAMFORD, Conn.--(BUSINESS WIRE)-- Today, Land & Buildings Investment Management, LLC (together with its affiliates, “Land & Buildings,” “L&B,” “us” or “we”), a shareholder of First Industrial Realty Trust, Inc. (NYSE: FR) (“First Industrial,” “FR” or the “Company”), issued a letter to shareholders responding to the Company’s latest shareholder letter dated April 13, 2026 and reiterating why shareholders should vote AGAINST the reelection of Chairman Matt Dominski and Director H. Patrick Hackett, Jr. to the FR Board of Directors (the “Board”) at the upcoming 2026 Annual Meeting of Shareholders (the “Annual Meeting”) on April 30, 2026.

The full text of the letter is below:

Dear fellow First Industrial Shareholders,

Earlier this week, First Industrial issued another shareholder letter urging you to vote “FOR” the Company’s director nominees. We encourage shareholders to look past the glossy production and examine what the letter actually reveals: a Board that continues to take credit for a portfolio transformation while refusing to address the governance failures that have left billions of dollars of shareholder value unrealized.¹

FR’s Own Letter Proves Our Case

The most telling aspect of FR’s letter is not what it argues — it is what it inadvertently confirms. In attempting to rebut our thesis, FR’s own letter reinforces the core argument Land & Buildings has advanced since December 2025. The Company touts its “multi-year transformation,” “higher average base rent and NOI per square foot,” “larger average building size,” and “evolution toward modern, higher-quality warehouse assets.” We agree. That is precisely the point.

The portfolio is high-quality. The portfolio rivals its closest peers, Prologis (NYSE: PLD) (“PLD”) and EastGroup (NYSE: EGP) (“EGP”). And yet FR continues to trade at a mid-6% implied cap rate on market rents while PLD and EGP trade in the low 5% range.² Green Street’s applied (private market) cap rates for FR and its closest peers are approximately the same, confirming that the private market recognizes FR’s quality even as the public market does not.

If the Board agrees the portfolio has been transformed, then shareholders deserve an explanation as to why a valuation gap of approximately 100 basis points to FR’s closest peers persists.³ We believe the Board does not address this question in its letter because it has no credible answer. The gap is not a portfolio problem. We continue to believe it is a governance discount.

FR’s Updated TSR Tables: Now With the L&B Activism Premium Baked In

FR’s letter includes two total shareholder return tables: one “unaffected” as of December 3, 2025 (the day before our public presentation) and one “current” as of April 6, 2026. The comparison is revealing.

Between these two measurement dates, FR’s 1-year TSR jumped from 10% to 27%, and its outperformance versus industrial peer averages expanded from 1 percentage point to 8 percentage points. In other words, a majority of FR’s recent relative outperformance occurred after Land & Buildings launched its public campaign. The Board is now citing performance generated by our activism as evidence that no change is needed. The irony should not be lost on shareholders. Even more telling, FR’s own “current” data shows the Company has underperformed the MSCI US REIT Index by 11% over three years and by 6% since February 2024.

Reactive Measures Are Not a Strategy

Since our public campaign began on December 4, 2025, the Company has announced:

• A $250 million share repurchase authorization that is discretionary and may never be executed;
• A 12% dividend increase;
• Appointment of one new director (Frank E. Schmitz), effective June 1, 2026 – after the Annual Meeting vote; and
• Property tours in Southern California (May 12) and New Jersey (June 4) – the start of the type of investor engagement we have been calling for.

None of these actions would have occurred without our public pressure, in our view. While we welcome them as evidence that shareholder engagement works, they remain half-measures designed to preserve the status quo. A discretionary buyback authorization is not a commitment. A post-vote director appointment is neither genuine board refreshment nor proper corporate governance. And scheduling property tours only after an activist campaign highlights years of inaction, not proactive governance.

The Board’s Characterization of Our Engagement Omits Critical Information

FR’s letter states that Land & Buildings “voluntarily and without discussion or proxy filing withdrew its nomination of Mr. Litt on March 20, 2026.” This characterization omits critical context.

We withdrew our nomination following FR’s announced appointment of Schmitz post Annual Meeting because we determined that change can be more effectively delivered from outside the boardroom, given this Board’s persistent unwillingness to engage constructively on meaningful governance improvements. During our initial engagement, Chairman Dominski effectively threatened to discontinue all communications with Land & Buildings if we did not agree with their hand-picked appointment of a new director to the Board and immediately withdraw our director nomination. That is not the behavior of a Board interested in genuine dialogue. It is the behavior of a Board interested in control.

Our withdrawal of a single director nomination does not mean our concerns have been addressed. It means we chose a different path to accountability: asking shareholders to vote against the two directors we believe are most responsible for the governance failures at this Company.

ISS Does Not Evaluate Uncontested Elections Under the Same Lens as Proxy Contests

FR’s letter highlights that Institutional Shareholder Services (“ISS”) recommends shareholders vote “FOR” the Company’s director nominees. ISS’ special situations research group, which evaluates contested elections, did not evaluate our recommendation to vote against Mr. Dominski and Mr. Hackett as it was explained to us on April 9, 2026, given our campaign is an exempt solicitation. Had they evaluated our position under the heightened scrutiny for contested elections, we believe that ISS may have recommended against one or more of these directors.

Shareholders should therefore make their own informed judgment and take into full consideration the persistent ~100 basis point cap rate discount to FR’s closest peers and the approximately $2 billion of foregone market capitalization as evidence that this Board does not possess the urgency and conviction to close that gap. We believe the facts are clear: a high-quality portfolio trades at a material discount because the market lacks confidence in this Board’s willingness to take the actions necessary to maximize value.

The $2 Billion Question Remains Unanswered

FR’s letter catalogs the Company’s operating achievements: AFFO growth exceeding its 9% target, leverage maintained below 6.0x, ~97% core market concentration, peer-leading same-store NOI growth, and dividend increases. We do not dispute these operational metrics. What the letter conspicuously fails to address is the fundamental question we have been asking since December: What is the Board’s specific plan to close the persistent valuation discount to its closest peers?

If FR’s portfolio quality truly rivals Prologis and EastGroup, and both the Company and Land & Buildings agree that it does, then we see no justification for a 100+ basis point implied cap rate discount. The Company has failed to provide shareholders with a credible explanation for why this gap exists or disclose a specific plan with milestones and timelines to close it. Instead, the Board asks shareholders to trust that continued execution will eventually be rewarded. Shareholders have been trusting this Board for years. The discount has persisted.

What We Believe the Board Should Do

We reiterate our call for the Board to:

• Publicly commit to a specific, measurable plan to close the NAV discount with milestones and timelines;
• Initiate a $500M–$1B asset disposition program with proceeds returned to shareholders;
• Commit to executing the share repurchase program, not merely authorizing it;
• Authorize a formal exploration of strategic alternatives if the discount does not narrow within six months; and
• Replace Mr. Dominski and Mr. Hackett with independent directors who bring fresh perspectives and a genuine commitment to closing the valuation gap.

VOTE AGAINST Dominski and Hackett on April 30

With the Annual Meeting two weeks away, we urge shareholders to send a clear message that the status quo is unacceptable.

• Mr. Dominski (71 years old, 16-year tenure) has presided over FR’s persistent discount to NAV and its peers, refused to engage constructively with shareholders on meaningful improvements, threatened to cut off communications with Land & Buildings, and simultaneously served as a long-time board member of CBL & Associates, a company that filed for Chapter 11 bankruptcy.⁴
• Mr. Hackett (74 years old, 16-year tenure) chairs both the Compensation and Investment Committees and oversaw a pay program that awarded CEO Baccile a 25% raise to $8.3 million in 2025 while the stock traded at a persistent discount to NAV and its closest peers.⁵

The Board’s own reactive concessions since December 4, 2025 prove that shareholder pressure works. A strong withhold vote against Dominski and Hackett at the upcoming Annual Meeting will send an unambiguous signal to the remaining Board members and management that shareholders demand not incremental gestures, but a credible, fully committed plan to unlock the full value of this high-quality portfolio.

We strongly believe that with meaningful Board change, FR shares can trade to our estimated NAV of $73 per share, representing over 20% upside from current levels.⁶ The only thing standing between shareholders and this value is a Board that refuses to act with the urgency the situation demands.

Sincerely,
Jonathan Litt
Land & Buildings Investment Management, LLC

***

THIS COMMUNICATION IS NOT A SOLICITATION OF AUTHORITY TO VOTE YOUR PROXY AND DOES NOT REQUEST OR SEEK THE POWER TO ACT AS A PROXY FOR ANY SHAREHOLDER. DO NOT SEND US YOUR PROXY CARD. LAND & BUILDINGS IS NOT ASKING FOR YOUR PROXY CARD AND WILL NOT ACCEPT PROXY CARDS IF SENT. LAND & BUILDINGS IS NOT ABLE TO VOTE YOUR PROXY, NOR DOES THIS COMMUNICATION CONTEMPLATE SUCH AN EVENT.

¹ FR SEC filings; L&B’s analysis.
² Green Street; L&B’s analysis.
³ Green Street; L&B’s analysis.
⁴ SEC filings.
⁵ FR SEC filings.
⁶ FR SEC filings; Green Street; L&B’s analysis.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260416503862/en/

Saratoga Proxy Consulting LLC
John Ferguson, (212) 257-1311
jferguson@saratogaproxy.com

Source: Land & Buildings Investment Management, LLC