Select Income REIT (SIR): Lakewood Capital Management Ups Stake To 5%

Lakewood Capital Management, led by Anthony Bozza, has upped its position in Select Income REIT (NYSE:SIR). A new amended filing with the U.S. Securities and Exchange Commission revealed that Lakewood Capital owns around 3.01 million Select Income REIT (NYSE:SIR) common shares. The stake is equal to 5.0% of the class, and represents increase from 2.08 million shares the fund held previously.

Lakewood Capital was founded by Anthony Bozza in 2007. Bozza previously worked at SAB Capital Management. He has a reputation as an astute short-seller. Lakewood Capital has around $1 billion in AUM. The fund lost around 20% in 2008, gained 70% in 2009 and 16% in 2010.

According to the filing, Lakewood Capital Partners has entered into certain cash-settled total return swap agreements with Credit Suisse First Boston (CSFB). The swaps with CSFB constitute economic exposure to 86,000 notional shares. In addition, Lakewood Capital Partners has entered into certain cash-settled total return swap agreements with Morgan Stanley (MSCO). The swaps with MSCO constitute economic exposure to 858,833 notional shares.

“Lakewood Capital Partners’ swap agreements with each of CSFB and MSCO provide Lakewood Capital Partners with economic results that are comparable to the economic results of ownership but do not provide it with the power to vote or direct the voting or dispose of or direct the disposition of the shares that are the subject of the swap agreements,” the filing states.

Taking into account the subject shares, Lakewood Capital Partners has economic exposure to about 3.95 million shares, which represents about 6.6% of the outstanding shares on the same basis. Lakewood Capital “disclaim beneficial ownership of the subject shares,” according to the filing.