DTZ’s new executive chairman Brett White may receive a long-delayed leaving gift of more than $3m from CBRE in March next year. The 55-year-old American retired as boss of the world’s biggest agent in December 2012.
Describing the departure of a man in his early 50s as “retirement” did feel a bit odd at the time. An examination of a US Securities and Exchange Commission filing dated 8 March 2010 shows why White’s departure was described as retirement.
Four years ago CBRE was extremely keen to hold on to its boss. White was granted options to buy 552,282 shares in March 2015 at the March 2010 price of $13.58. A gift then valued at $7.5m, taking his compensation that year to $11m.
Just over two years later, in May 2012, the firm announced White would retire in December 2012, with his job being taken by CBRE president Bob Sulentic, who now occupies both seats.
Under the terms of the 2010 agreement, retirement from CBRE meant White remained able to claim 21/60ths of his shares – a fraction calculated on the basis that he was employed for 21 out the 60 months of the five-year agreement.
The new boss of DTZ is entitled to buy 193,000 CBRE shares at $13.58 next March and sell them at the market price. Today’s share price is $31 per share, which would net White a profit of $3.3m if he exercises the option.
Rewarding comparisons: one
Talking of pay, it’s nice to see Quintain providing a comparison between the average pay per employee and that of the bosses. The numbers come in the annual report for the year to March, published this week. Boss Max James saw his total remuneration rise from £1.1m to £1.4m – about double the amount former boss Adrian Wyatt was earning when he left in mid-2011. Investment director Nigel Kempner’s remuneration rose from £762,000 to a tad over £1m. The average pay and bonus for each of the 122 staff was £84,998, giving a modest master-to-serf ratio of 16.8 to one in favour of the boss.
Rewarding comparisons: two
Total remuneration numbers are now in for the two biggest property companies. Top of the list comes Chris Grigg of British Land, earning £4.9m in the year to March, up £100,000 or so on 2013.
His compensation could have been higher. The maximum percentage of his base salary Grigg was allowed to earn in bonus (180%) and share awards (250%) was cut back last year, to match the 150% bonus and 200% share awards of his lieutenants. Their earnings were: Lucinda Bell £2.3m, Charlie Maudsley £2.5m, and Tim Roberts £2.2m.
LandSec boss Rob Noel earned £2.3m last year. His lieutenants’ earnings were: Martin Greenslade £1.8m and Richard Akers £2.6m. Neither company yet offers a comparison with staff pay.
Construction costs build
Developers which have not revisited construction cost estimates for upcoming projects recently should do so right away. There is a general perception that prices are rising. Developers are inching up building cost inflation estimates from 2-3% to 4-4.5% pa. But three different voices in three weeks mentioning the same issue suggest time as well as money is at risk.
Bricks are the main bugbear. The oligopoly of European makers doesn’t have to worry too much about competition. Prices are up by 40% in the past year for particularly fashionable continental bricks. Worse, delivery times are stretching from weeks to months. Worst of all are the planning delays.
“The suppliers deny they are putting up prices,” says one angry developer. “But what they are doing is saying the brick you ordered is no longer being made. You’ve got to choose another – at a price that turns out to be far higher. You then have to go back to the planners to get the new brick approved. That can take months. The whole thing is turning into a nightmare.”
Peter Bill, London Evening Standard
www.planet-property.net
