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Sends Letter to Fellow Stockholders Detailing the Systemic
Performance, Strategy and Governance Shortcomings That Have Led to
Long-Term Value Erosion

Lays Out Why Front Yard’s Intended Acquisition of Another 35,000
Homes – After Years of Declining NAV – Would Represent Yet Another
Costly Strategic Misstep That Harms Stockholders

Reiterates That No Credible Plan Exists to Close the Company’s
Staggering Valuation Gap and Unlock the Roughly 85% of Upside Value
Trapped in its Shares

Launches Campaign Website at

Urges Stockholders to Support Necessary Change in the Boardroom by
Voting on the BLUE Proxy Card to Elect Snow
Park’s Highly-Qualified, Independent Nominees

NEW YORK–(BUSINESS WIRE)–Snow Park Capital Partners, LP (together with its affiliates, “Snow
Park” or “we”), a significant long-term stockholder of Front Yard
Residential Corporation (NYSE: RESI) (“Front Yard” or the “Company”),
which together with the other participants in its solicitation
beneficially owns approximately 2.1% of the Company’s outstanding
shares, today issued a public letter to stockholders in connection with
its nomination of three highly-qualified, independent candidates for
election to the Company’s Board of Directors at the upcoming annual
meeting of stockholders.

Please note that upon taking into account thoughtful feedback from our
fellow stockholders and evaluating Front Yard’s most pressing needs,
Snow Park today narrowed its slate to three members with respective
expertise in the single-family residential market, real estate
investment and transactions, and Real Estate Investment Trust (“REIT”)
sector corporate governance and portfolio management.

Snow Park urges all stockholders to vote the BLUE
proxy card
today. Our nominees – stockholders Leland Abrams, Lazar
Nikolic and Jeffrey Pierce – possess strong real estate pedigrees,
robust mortgage and financial services experience, and deep knowledge of
effective corporate governance practices in the REIT sector. We believe
a reconstituted Board that includes our nominees will have the necessary
expertise and ownership perspectives to support a full and fair
strategic review and help the incumbent directors identify paths to
value creation at Front Yard. Please visit
today for more information and resources.

Below is the full text of the letter.


April 29, 2019

Dear Fellow Stockholders:

Snow Park Capital Partners, LP (together with its affiliates, “Snow
Park” or “we”) believes that the long-term underperformance endured by
stockholders of Front Yard Residential Corporation (NYSE: RESI) (“Front
Yard” or the “Company”) is the result of strategic missteps, poor
balance sheet management, inadequate corporate governance and a weak
non-independent Board. This stockholder suffering is underscored by the
fact that since the beginning of 2015, Front Yard’s stock is down nearly
50%, and in 2018 alone, its stock was down approximately 30%.

Unfortunately, we feel the incumbent Board is presently either
ill-equipped and/or unwilling to address Front Yard’s significant
challenges, including one of the Real Estate Investment Trust (“REIT”)
sector’s most staggering valuation gaps. This is why we have nominated a
slate of highly-qualified, independent director nominees with deep
experience when it comes to the portfolio management, operations, and
governance of publicly traded REITs. Our slate stands for enhanced
accountability for management, improved strategic thinking across all
facets of the business and stockholder-friendly governance policies –
all of which can help us maximize value for stockholders. Our nominees
are also committed to ensuring that stockholders have a true voice in
the boardroom and that Front Yard objectively assesses all avenues to
unlocking the value currently trapped within its shares.

Snow Park would also like to call your attention to the fact that upon
taking into account thoughtful feedback from fellow stockholders and
evaluating Front Yard’s most pressing needs, we decided to narrow our
slate to three members with respective expertise that aligns to the
Company’s most urgent challenges. We – in contrast to the incumbent
Board – believe that soliciting and embracing the input of stockholders
in this manner is essential to strategic decision-making.

We urge all stockholders to vote the enclosed BLUE
proxy card or BLUE voting
instruction form to elect our slate of three highly-qualified
individuals – Leland Abrams, Lazar Nikolic and Jeffrey Pierce – to Front
Yard’s seven-person Board. If you have already voted using the Company’s
voting form, or if your vote was taken over the telephone by a
representative of the Company, you have every right to change your vote
by simply returning a later dated BLUE
voting form in the enclosed pre-paid envelope. Alternatively, you can
quickly send the Company a strong message that the status quo is
unacceptable by voting over the Internet or by telephone, as well.

For years, Snow Park has been troubled by what we consider to be Front
Yard’s reluctance to acknowledge and address the issues plaguing the
Company. Moreover, we believe the consequences associated with the
Board’s years of inaction have created an indefensible record for the
incumbent directors. This is a critical juncture in Front Yard’s
lifecycle as a public company, which is why we feel it is important to
remind stockholders about the Company’s track record and why it is so
vital for the status quo to change.
Consider the following:

Miserable Financial Performance

Despite operating during a bull market in the single-family residential
space and a period of tremendous economic growth, Front Yard has
delivered negative returns
while dramatically underperforming relative to its peers and the broader
marketplace. We believe the Company’s total shareholder returns are
unacceptably poor over the past one, three and five-year periods.

1 Year   3 Year   5 Year
Front Yard Residential (0.5%) (7%) (57%)
Invitation Homes* 9%
American Homes for Rent 15% 48% 44%
MSCI US REIT Index 21% 20% 54%
S&P 500 11% 47% 68%

RESI Relative Returns vs:

Invitation Homes (9%)
American Homes for Rent (15%) (55%) (101%)
MSCI US REIT Index (21%) (26%) (111%)
S&P 500 (11%) (54%) (126%)
*Invitation Homes went public on 1/31/2017

Source: Bloomberg; performance calculated as of close on April
1, 2019 (day immediately

prior to Snow Park’s public
letter on April 2, 2019 disclosing its nomination of nominees).


Despite this poor track record, we find it confounding that the
incumbent Board has shown such little interest in adding ownership
perspectives or even learning about what has been troubling
stockholders. This is yet another reason why we no longer feel the
status quo is acceptable.

Costly and Concerning Strategic Lapses
Punctuated by a Leverage-Fueled Acquisition Spree

We believe Front Yard’s prolonged underperformance is largely the
byproduct of what we consider to be easily avoidable strategic missteps.
In particular, the Company has been built up in recent years through
unsustainable and leverage-fueled acquisitions, leaving stockholders
burdened with more risk while at the same time offering no solutions to
fix what has become one of the most leveraged balance sheets in the

As many studies have shown, REITs with excess leverage persistently
trade at a discount1 to their Net Asset Value (“NAV”)
calculations. Since Front Yard has not shown any ability to even access
the capital markets, we believe this pattern of poor balance sheet
management has been a primary factor that has led to stockholder losses.

Complicating this issue is Front Yard’s contract with its external
advisor.2 Specifically, the contract states that all equity
raised will generate a 2% fee for the external advisor. With acquisition
cap rates at sub-6% levels, this makes it infeasible to raise common
equity to lower leverage (even if the stock traded at the Company’s
stated NAV) – as any deals would be dilutive and the General &
Administrative expense burden would continue to worsen. We question, as
all stockholders should, why the Board allowed the balance sheet to
deteriorate without any reasonable path to de-leveraging. This sort of
balance sheet management underscores that the incumbent Board lacks the
accountability, checks and balances, and necessary expertise that all
modern publicly-traded REIT boards should have. We find it indefensible
that Front Yard has placed its balance sheet in such a precarious

Moreover, perhaps the most troubling fact pattern is that by Front
Yard’s own admissions, its leveraged-fueled acquisition spree has had
consequences beyond just failing to increase the Company’s NAV. Its own
NAV estimate, which in 2016 was $21 per share, has actually declined
to $17.50 per share this year.3

And yet after all this, the message to stockholders on Front Yard’s most
recent earnings call was that the Company plans to position the business
to buy another 35,000 homes.4 We firmly believe that the
Company’s track record in no way supports such an endeavor. To the
contrary, we feel this message only further underscores the lack of
accountability in the boardroom given that the incumbent directors sat
by idly as NAV inexplicably declined at the 15,000-home level.

Simply put, Front Yard finally needs to articulate a coherent strategy
with a timeline that will enable stockholders to be able to realize the
tremendous value that remains trapped in its shares before blindly
buying another 35,000 homes without any identifiable capital sources.
Snow Park’s nominees will be laser-focused on preventing further
strategic missteps in this area and ensuring NAV realization for
stockholders at last. We feel no strategy can be implemented or executed
without prioritizing this realization.

Limited Stockholder Alignment and Poor

We have long held that not having an ownership mentality in the
boardroom has led to poor corporate governance and unproductive
stockholder relations. While Snow Park’s nominees collectively
beneficially own approximately 2.1% of Front Yard’s outstanding shares,
the incumbent independent directors collectively beneficially own
approximately 0.07%5 of the Company’s outstanding shares. In
our view, the incumbents’ lack of a vested financial interest in the
Company’s performance causes a misalignment of interests between
stockholders and Front Yard’s Board.

But rather than seeking to add relevant expertise and ownership
perspectives to the Board, Front Yard in recent years has added former
long-term colleagues of its chief executive, George Ellison, who himself
is an employee of the Company’s external manager. We question whether it
was in the best interests of stockholders to place these allegedly
“independent” individuals – Rochelle Dobbs and George McDowell – into
Board leadership positions overseeing Mr. Ellison. Further, former
Chairman David Reiner, who only recently stepped down from the
chairmanship last year, is still on the Board despite presiding over the
Company’s catastrophic declines since its initial public offering. This
does not appear to be a board designed with true checks and balances,
but one designed to be friendly to management.

We also believe the Company has defied best practices in corporate
governance and severely limited the ability of stockholders to spur
necessary changes and have their voices heard. Front Yard is a
Maryland-incorporated entity that has not opted out of the Maryland
Unsolicited Takeovers Act, which allows the Board to take various
stockholder-unfriendly actions, such as classifying the Board without
stockholder approval. Moreover, unlike the numerous boards of Maryland
corporations that have sought to provide their stockholders with the
right to amend company bylaws, Front Yard has not.

On top of all the protections from its stockholders the Company is
afforded in Maryland, Front Yard also does not allow its stockholders to
effectively act by written consent – it must be unanimous – and they can
only call special meetings upon the request of a majority of outstanding
shares. In addition, directors may only be removed by a prohibitively
high two-thirds vote. These positions represent an affront to
stockholder rights that is emblematic of the Board’s unwillingness or
inability to take the right actions to improve stockholder value.

In sum, the only effective recourse stockholders have to take action is
through annual elections. This is why after many years of suffering,
Snow Park decided to nominate a slate with the ability and pedigree to
change the status quo and allow for owners to have a say in the

There Is an Alternative to the Dismal Status
Quo: Empower the Snow Park Slate to Renew RESI

It is clear to Snow Park that urgent change is needed at Front Yard in
order to rectify all of these challenges and put the Company on a path
to value creation. We once again encourage you to support the election
of our three highly-qualified director nominees – stockholders Leland
Abrams, Lazar Nikolic and Jeffrey Pierce – who will be laser-focused on
supporting an expert-led strategic review, reforming poor corporate
governance practices, and helping Front Yard take actions that can close
its valuation gap and unlock the significant upside in its shares.

We urge Front Yard stockholders to vote FOR all three of Snow Park’s
highly-qualified, independent nominees on the BLUE
Proxy Card and to return it in your postage-paid envelope provided.
you have already voted Front Yard’s proxy card, you can change your vote
by providing a later dated BLUE proxy.

Should you have any questions or need assistance with voting, please
contact Saratoga Proxy Consulting LLC at (888) 368-0379 or (212)
257-1311 or by email at
[email protected].


Jeffrey Pierce


About Snow Park

Snow Park Capital Partners, LP is a privately-held investment manager
that specializes in investing in publicly-traded real estate securities
across the capital structure. Based in New York City and founded by
Jeffrey Pierce, the firm focuses on producing strong risk-adjusted
returns for a diverse investor base of public institutions, private
entities and qualified individual clients.


1 Green Street Advisors, LLC’s Heard on the Beach

2 Specifically, the flawed external advisory agreement
with Altisource Asset Management Corp.

3 A NAV of $21 was set forth in Front Yard Residential
Corp.’s May 2016 earnings call transcript (link),
and a NAV of $17.50 was set forth in Front Yard Residential
Corp.’s February 2019 earnings call transcript (link).

4 Front Yard Residential Corp.’s February 2019 earnings
call transcript (link).

5 Front Yard Residential Corp.’s preliminary proxy
statement filed on March 29, 2019.


For Investors:
Saratoga Proxy Consulting LLC
John Ferguson /
Joe Mills, 212-257-1311
[email protected]
/ [email protected]

Greg Marose / Charlotte Kiaie, 347-343-2999
[email protected]
/ [email protected]