Sam Zell with Equity International and Equity Residential is gearing up to appoint Thomas Heneghan to the position of CEO following the departure of Gary Garrabrant a little less than a month ago. Heneghan is currently CEO with Equity LifeStyle Properties, a Chicago-based Real Estate Investment Trust (REIT) involved in the ownership of resort communities including RV and park model developments.
According to the Wall Street Journal, the appointment is subject to approval of Equity International’s investors. Furthermore, the investors could make other changes to the fund or shut it down completely. In 2011, Equity International completed the capital raise for its fifth fund, consisting of $650 million in commitments. Half of that amount has been invested or committed, but the fund guidelines prohibits Equity International from making new investments until the fund receives investor approval.
Garrabrant and Equity’s chief strategic officer Thomas McDonald left Equity International last month for undisclosed reasons. At the time Zell stepped into the role of interim CEO. Investors have six months from Garrabrant’s departure to decide to continue with the fund or to halt future capital calls.
Though Heneghan is well-liked by institutional investors and has held many positions at Equity LifeStyle (which owns resort properties used for recreational vehicles), there is a question about his international experience. Equity LifeStyle is focused on the United States, rather than international markets. Equity International investors include endowments like Duke University and Cornell University and pension funds like the Teacher Retirement System of Texas.
“We are in the process of working with our investors on a number of items and there have been no definitive decisions to date,” Zell says in a statement. “Equity International has a highly engaged ownership group that is still discussing the next steps for the business going forward.”