Maguire Properties Inc., a Los Angeles-based real-estate investment trust, is fighting back against criticisms lobbed by a hedge fund that has taken a sizable position in the company -- in the first jabs of what could become a rare proxy fight in the REIT world, the Wall Street Journal reports.

In a recent interview, Chief Executive Robert Maguire III for the first time responded publicly to criticisms levied against him by JMB Capital Partners Master Fund LP, which has taken a 5.2% stake in the company and is urging Maguire to explore "strategic alternatives," including selling itself. He said misconceptions about his possible conflicts of interest, alleged by JMB and others, "need to be put to rest, because it's gone on too long."

The response comes at a tense time for Maguire Properties, a REIT that owns 35 million square feet of office buildings, primarily in southern California. The company explored selling itself late last fall, but scrapped those plans and decided to continue as a public REIT early this year. It then made a $3 billion bet on a number of properties sold by the Blackstone Group LP, including 22 properties in Orange County that had a number of residential mortgage lenders as tenants before the subprime market cratered.

During the summer's market turmoil, investors sold off Maguire. Total returns are down 32.7% for the year, despite a recent jump due to rumors that the company again might be for sale. (In comparison, the SNL U.S. REIT Equity Index is down 14.7% this year.)

On Nov. 12, JMB Capital sent Mr. Maguire a letter announcing its stake in the company and raising concerns over properties Mr. Maguire owns and his reluctance to cut the company's dividend. JMB has threatened to propose an alternative slate of directors if Maguire ignores its demands -- an unusual possibility for JMB, because Maguire, unlike many REITs, doesn't have a staggered board.

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