CommonWealth

CommonWealth REIT, of Newton, Mass., is buying the 51-story office building named One Shell Square from MetLife Inc., the people said.

Tall Order in the Big Easy Maura Webber Sadovi 2011

CommonWealth's buying spree—and its decision to finance it, in part, by selling new shares—also has attracted new scrutiny to the REIT.

Tall Order in the Big Easy Maura Webber Sadovi 2011

CommonWealth's total annualized one-year return as of July 27 was 1.3% compared with 22.82% for the index, and the company's 15-year annualized return was 3.4% compared with 10.8% for the index, according to Green Street.

Tall Order in the Big Easy Maura Webber Sadovi 2011

CommonWealth has spent more than $2 billion scooping up dozens of office buildings through the downturn, making it one of the biggest buyers of U.S. office properties in this cycle, according to Real Capital Analytics.

Tall Order in the Big Easy Maura Webber Sadovi 2011

CommonWealth and MetLife declined to comment on the deal.

Tall Order in the Big Easy Maura Webber Sadovi 2011

In CommonWealth's case, the company's day-to-day operations are managed by Reit Management & Research LLC, owned by Barry Portnoy and his son Adam Portnoy .

Tall Order in the Big Easy Maura Webber Sadovi 2011

CommonWealth is no stranger to criticism as a so-called externally managed REIT.

Tall Order in the Big Easy Maura Webber Sadovi 2011

But, for its lower price, CommonWealth is taking on some market risk.

Tall Order in the Big Easy Maura Webber Sadovi 2011

Both are on CommonWealth's board of trustees, and Adam Portnoy is president of both CommonWealth and Reit Management.

Tall Order in the Big Easy Maura Webber Sadovi 2011

CommonWealth has underperformed the FTSE NAREIT All Equity REITs Index , a broad group of REIT stocks.

Tall Order in the Big Easy Maura Webber Sadovi 2011