Elliman shareholder’s demands against Howard Lorber gain support

Two independent proxy firms recommended demands by a Douglas Elliman investor seeking votes against chairman Howard Lorber. 

Investor Brad Tirpak urged shareholders last month to vote against a proposal concerning executive compensation and vote for a proposal to elect directors each year, according to his letter released ahead of the company’s shareholder meeting on Aug. 21.  

The investor issued another letter on Tuesday announcing that advisory firm Institutional Shareholder Services recommended shareholders vote for annual director elections and withhold votes on Lorber, whose contract is set to expire on Dec. 29. 

In his initial letter, Tirpak took aim at Lorber’s longtime role atop the brokerage, as losses mounted and share prices tumbled. Lorber’s reign also drew scrutiny in the wake of sexual assault allegations against two of the firm’s former top brokers, Oren and Tal Alexander. 

Tirpak in the letter also points to the Diversity, Equity and Inclusion portion of Lorber’s bonus, of which he “received the Maximum permissible award” despite news of the allegations against the Alexanders. 

A spokesperson for Elliman said at the time of the letter the company will “carefully review” the letter and said its board of directors and management team “maintain an open dialogue with, and value constructive input from, our stockholders.”

“Douglas Elliman notes that the former brokers accused of sexual assault left the Company more than two years ago, and there were no complaints against them when they were at the Company nor was there any concealment or preferential treatment with respect to those brokers,” the firm said in a statement.

Tirpak also encouraged shareholders to vote to bring compensation in line with stockholder returns, citing a proxy statement filed by Elliman in June that lowered the standard used by the board of directors to determine executive bonuses. 

Another advisory firm, Glass Lewis, recommended shareholders vote against the company’s proposed executive compensation. 

Excluding stock awards, Lorber earned more than $4.7 million last year, up by more than $600,000 from 2022, according to the company’s annual report filed with the Securities and Exchange Commission. 

Both Lorber and chief operating officer Richard Lampen took home higher bonuses compared to the previous year, based in part on an adjusted EBITDA calculation that differed from the metric included in its earnings report. Without the subtraction from the bonus formula, the firm’s adjusted EBITDA would not have met the incentive threshold of negative $20 million. 

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Advisory firms like ISS and Glass Lewis regularly weigh in on issues of corporate governance and make recommendations to investors. Earlier this year, both companies recommended shareholders of Toyota Motors to vote against re-electing chairman Akio Toyoda, though investors opted to keep Toyoda, the grandson of the firm’s founder, in his post.  

In mid-July, ISS and Glass Lewis also recommended Crescent Energy and SilverBow Resources shareholders vote for a proposal to merge the two companies, with the $2.1 billion acquisition crossing the finish line by the end of the month.