The Real Deal New York

SL Green’s Holliday, Mathias get big bump in pay packages

REIT, now valued at $22.5B, cites "significant financial achievements" in justifying hikes

April 28, 2015 11:50AM
By Rey Mashayekhi

SL Green

From left: Andrew Mathias, Marc Holliday and Stephen Green (credit: Steve Friedman)

Citing “superior long-term total return to stockholders” and “significant operational and financial achievements,” SL Green Realty opted to give large hikes in total compensation to CEO Marc Holliday and president Andrew Mathias.

Holliday earned $16.4 million in 2014, a 29.7 percent year-over-year increase from $12.7 million in 2013, according to a form the real estate investment trust filed April 24 with the Securities and Exchange Commission. Mathias earned $11 million, an 18 percent year-over-year increase from $9.3 million in 2013.

Holliday’s salary remained unchanged at $1.05 million, but he received stock awards of $14.2 million, according to the SEC filings. Mathias’ salary went up $50,000 to $800,000, and he received stock awards of $10.2 million. Chair Stephen Green’s compensation for 2014 was $5.4 million, about the same level as the previous year.

The New York-focused REIT pointed to total returns to stockholders of 147 percent over a 10-year period through the end of last year – which outperformed both the MSCI REIT Index (122 percent) and the S&P 500 Index (110 percent) in that period – in justifying the compensation.

SL Green also noted a 574 percent increase, to $22.5 billion, in the REIT’s enterprise value during Holliday’s tenure as CEO, adding that the compensation packages are “appropriate” in comparison to those received “by other top executives at peer companies or firms operating in the New York City real estate market.” SL Green is New York City’s largest commercial landlord, with ownership, debt and equity interests in about 101 buildings totaling more than 40 million square feet, according to its website.

The filings illustrate some of the REIT’s key business objectives for last year. Holliday, Mathias and Green each received the “maximum amount” under the REIT’s annual cash bonus program, as a result of the company meeting or exceeding targets across a number of performance standards, such as annual square footage of Manhattan leases signed (nearly 2.1 million square feet) and same-store Manhattan portfolio occupancy (96.1 percent). SL Green spent $2.6 billion on acquiring office properties in 2014, and sold office properties worth a combined $980 million. It also invested $435 million in acquiring residential and retail properties.

It failed to meet a number of targets, however, such as signing a retail anchor tenant at 650 Fifth Avenue.

An SL Green spokesperson declined to comment further.

As in previous years, SL Green said it used a “peer group” to evaluate executive compensation at other “New York City-focused peer companies” – citing 11 companies, including Boston Properties and Vornado Realty Trust, with whom it was “able to compare publicly available data.”

Boston Properties CEO Owen Thomas earned $8.3 million last year while company president Douglas Linde made $6.8 million, the Boston-based REIT recently disclosed. Both men saw their earnings increase more than 10 percent from the previous year.

Vornado Realty Trust CEO Steven Roth earned $9.8 million in total compensation in 2014 — a 33.7 percent increase from $7.3 million the previous year, the company disclosed this month. The REIT’s New York division president David Greenbaum made $5.4 million last year, up 21.4 percent from $4.4 million in 2013.