A week after Whitestone REIT was offered a $700M buyout, the Houston-based shopping center owner has politely declined.

Baltimore-based MCB Real Estate put an all-cash acquisition offer on the table, but Whitestone said it didn't believe it was a fair amount and that it has a strategy to generate more value than what MCB offered.

“The Board believes that your indicated offer price does not represent a fair valuation and strongly believes that current management has a clear strategy and compelling pathway for creating long-term shareholder value significantly greater than the amount offered,” Whitestone CEO David Holeman wrote in a letter addressed to MCB Managing Partner David Bramble.

The letter was filed with the Securities and Exchange Commission on Tuesday.

Whitestone started undertaking capital recycling efforts in late 2022, the same year it fired longtime CEO James Mastandrea.

Whitestone owns and operates more than 50 properties across five markets — Phoenix, Austin, Dallas-Fort Worth, Houston and San Antonio — with an average 94% occupancy, according to its first-quarter report. The value of its assets totaled $1.1B, while it had liabilities of around $694M in Q1.

The REIT has been active in buying and selling this year. In February, it acquired the 107K SF Garden Oaks Shopping Center in Houston for $27.2M, and in March, it sold the 119K SF Mercado at Scottsdale Ranch in Phoenix for $26.5M, according to its Q1 report.

In MCB's offer letter last week, Bramble wrote that he was “keenly aware of the challenges” facing Whitestone, “such as access to growth capital,” adding “that these challenges can best be addressed as a private company with a well-capitalized sponsor.”

“The speed and certainty with which we are prepared to move forward to consummate the transaction would allow the Company’s shareholders to de-risk their investment and obtain immediate liquidity at a compelling valuation,” he wrote.

Baltimore-based MCB owns a stake of more than 9% in Whitestone. MCB owns and operates 14.5M SF across all asset classes, with $3B in assets under management.

The company is leading the redevelopment of Baltimore’s Inner Harbor, a $500M project consisting of four new mixed-use buildings and 19 acres of public space. It is also behind the Viva White Oak development in Maryland, a 280-acre campus next to the Food and Drug Administration headquarters that is approved for 12M SF of mixed-use development. That project is expected to break ground in 2025.