Orion Properties Group has initiated a strategic alternatives review that could reshape the commercial real estate investment trust's future.
The company said Tuesday it plans to explore options, including potential mergers, acquisitions or a complete sale. Continuing as an independent public entity also remains on the table.
The announcement comes as Orion has faced an unsolicited buyout attempt and boardroom battle involving Kawa Capital Management.
Phoenix-based Orion operates 63 properties totaling 7.4 million leasable square feet across 28 states as of September. The company holds six non-operating properties.
The REIT also owns an equity stake in a joint venture with Arch Street Capital Partners. That portfolio comprises six properties totaling about 1 million leasable square feet across six states.
Orion reached a cooperation agreement with Kawa that resulted in the alternative asset manager withdrawing its notice to nominate five directors at the 2026 annual meeting. Kawa holds 5.47 million Orion shares, representing 9.7% of outstanding stock. Kawa offered $2.50 per share last summer for the remaining shares it doesn't own.
The agreement grants Kawa participation rights in the strategic review. The firm can receive confidential information and submit proposals on equal terms with other third parties.
"We appreciate the dialogue with Kawa that enabled us to reach this agreement," Paul McDowell, Orion's CEO and president, said in a statement. "The company and the board remain steadfast in our commitment to delivering value for stockholders."
The strategic review marks a critical inflection point for Orion as it attempts to pivot away from struggling suburban office assets. Its willingness to consider a sale reflects broader challenges facing office-focused REITs amid persistent remote work trends and declining valuations.
Orion's new targets include dedicated-use assets such as medical offices, laboratories, research and development flexible space, and government facilities located outside central business districts.
The REIT provided no completion timeline for the review process. The board offered no assurance that the process would produce any transaction or specific strategic outcome.