2014 Real Estate Industry Long-Term Incentive Report
The FTI Consulting, Inc. Real Estate Industry Long-Term Incentive (“LTI”) report provides an overview of equity-based compensation practices at the top 125 publicly-traded REITs. We believe that the top 125 REITs provide the best insight into current and emerging compensation trends, and accordingly, our report focuses on these companies. Any references in this report to “REIT(s)” only denotes the top 125 REITs included in the study.
The following information is based on our extensive review and analysis of compensation-related disclosure obtained through public documents filed with the Securities and Exchange Commission. FTI has specifically analyzed long-term incentive information disclosed within the most recently filed proxy statements, plus subsequent materials filed in Form 4’s and 8K’s. Our goal is to provide the most timely and accurate information available for a more in-depth understanding of the LTI vehicles used in the real estate industry.
The top 125 REITs were determined based on year-end 2013 enterprise values. Enterprise value includes the value of common shares and OP Units (i.e., equity market capitalization), plus debt and the book value of any preferred shares, with the following modifications to the constituent list:
- Excludes externally-managed companies that do not directly pay cash compensation to their Named Executive Officers (“NEOs”).
- Excludes any IPOs or REIT conversions that were completed after June 30, 2013.
- Adjusted to include select hotel companies that have not elected to qualify for REIT status for tax purposes but whose operations are comparable to other hotel REITs (e.g., Hyatt Hotels Corporation).