Executive compensation at the country's top 100 publicly traded real estate companies reached a five-year high for the performance year 2010, eclipsing pre-recession 2006 peak levels by 13%, according to FPL Associates' 9th annual review of public filings across the public real estate industry.
Annual median CEO total compensation at the largest public real estate companies was $3.4 million in 2010, just over 10% higher than the 2006 peak-level median total compensation of $3.1 million. Additionally, 2010 CEO compensation was 26% higher than the 2009 level of $2.7 million – the second consecutive year of solid gains in compensation of greater than 10%.
According to Chicago-based FPL Associates, CEO compensation decreased by double digits in 2007 and 2008, but began to rise by 2009. In 2010, overall compensation for the top four positions – CEO, chief operating officer, chief financial officer and general counsel – was $7.65 million, 21% higher than 2009's level of $6.3 million – which, itself, was nearly 15% above the prior year.Â
‘Since the market downturn in late 2008, the top 100 firms posted total shareholder returns of 28 percent on a compounded, annualized basis, and compensation during this same period increased by 18 percent,’ says Jeremy Banoff, senior managing director at FPL Associates. ‘While there remain weaknesses in the overall economy and in the commercial real estate sector, clearly, these increases demonstrate that public real estate companies are delivering value to investors, and that is being reflected in compensation to the senior executives.’
