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Adam Gant, the former chief executive officer of Partners REIT and the co-founder of its external manager, is taking on the real estate trust's independent trustees.

Last week the trustees said they are in favour of internalizing the Partners' management – explained here – and released their proxy circular on the subject on Monday, arguing that it's the best thing for the REIT and its investors.

But Mr. Gant said in an interview Tuesday that he believes this group isn't making the recommendation for fiduciary reasons. Instead, he believes they are doing this because they found out that he wants to replace them with a new slate of independent directors.

"We don't actually think the issue is internalization," he said. "We're certain that that's not the issue at hand."

Mr. Gant says that the trustees caught wind of his plan to replace them and decide to act out. "This is the one thing they can do that can potentially provide the optics that they're working for the best interests of unitholders," he said.

For those wondering how going down this route could hurt Mr. Gant, he runs League Financial Partners, which is the parent company of Partners' external manager. If management is brought in-house, Partners would no longer pay his company annual fees.

Mr. Gant says that his plans have long been in the works. "We've become increasingly uncomfortable over the last few months," he said, because he has had some growing concerns over the past few months. Chiefly, Partners chairman Louis Maron is also chairman of Summit II Reit and Partners trustee Saul Shulman is also a trustee on Summit's board. Mr. Gant argues that this creates a conflict of interest.

John van Haastrecht, one of Partners' independent trustees who has offered to lead the internal management team should it be brought in house, said these concerns don't carry much weight because Partners and Summit operate in two different markets – Partners owns sh opping centre locations while Summit focuses on industrial properties.

"There's absolutely no conflict between Partners and Summit REIT," he said.

Patrick Miniutti, League's chief operating officer also said that the independent trustees never came to them with the internalization plans, so they didn't know they were in the works.

"They never approached us about internalizing the existing management," he said. "They've proceeded going down that path without any conversation."

Mr. van Haastrecht confirmed that management wasn't aware of the internalization plans.

Following Mr. Gant's remarks, the rhetoric between the two parties is now heated and both sides accuse the other of wrongdoing. At this point it appears the only resolution will come at Partners' annual general meeting in June after shareholder votes for and against the nominated directors are revealed.

( Tim Kiladze is a Globe and Mail Reporter.)

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