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Kennedy-Wilson Holdings, Inc. (NYSE:KW), a real estate investment company currently valued at $1.25 billion, has made significant changes to its executive compensation structure, as detailed in a recent SEC filing.
According to InvestingPro analysis, the company shows a weak overall financial health score, though it has maintained dividend payments for 14 consecutive years. On January 29, 2025, the company’s Compensation Committee approved new carried interest award agreements for its named executive officers under an amended carried interest sharing program.
The updated program allows Kennedy-Wilson to allocate up to 50% of carried interest earned from certain commingled funds and separate account investments to its employees, including executives. This marks an increase from the previous cap of 35%. The company’s management has been actively engaging in share buybacks, as highlighted by InvestingPro’s analysis, demonstrating alignment with shareholder interests.
Carried interest awards will be granted to executives, providing them with a specified percentage of the carried interest that the company receives. These awards are structured to vest over time, with 60% vesting in equal installments over four years, contingent on continued employment. The remaining 40% vests upon a liquidity event, also requiring ongoing employment.
In the event of termination, unvested carried interest awards will be forfeited. If termination is for cause, all awards, vested or not, will be canceled without compensation.
The payment for vested carried interest awards is to be made in cash within 60 days after the company receives the related carried interest. A cash bonus cutback mechanism has also been introduced, which adjusts an executive’s cash bonus opportunity based on carried interest payments received.
The specific carried interest allocation percentages for top executives include 7.5% for CEO William J. McMorrow, 5.0% for Executive Vice President Matt Windisch, and 2.0% each for CFO Justin Enbody and COO In Ku Lee.
With the company’s next earnings report scheduled for February 26, 2025, investors seeking deeper insights into Kennedy-Wilson’s financial health and executive compensation impact can access the comprehensive Pro Research Report, available exclusively on InvestingPro, which covers this and over 1,400 other US stocks.
The information is based on a press release statement and provides a comprehensive overview of the new compensatory arrangements without endorsing the company’s strategy or its implications for the market.
In other recent news, Kennedy Wilson demonstrated remarkable financial growth in the third quarter of 2024, with a significant increase in assets under management (AUM) and net operating income (NOI). The company’s AUM rose to $28 billion, while the estimated annual NOI reached $492 million. Kennedy Wilson’s strategic focus on rental housing, particularly its expansion in the United Kingdom (TADAWUL:4280) via a partnership with the Canadian Pension Plan Investment Board (CPPIB), has been a key contributor to its success.
The company also saw a 51% rise in investment management fees, reaching $69 million year-to-date, and completed $2.1 billion in new loan originations in 2024. Kennedy Wilson launched a new single-family rental housing platform in the UK and maintained a 94% occupancy rate in its multifamily portfolio.
These recent developments underscore Kennedy Wilson’s adaptability in a dynamic market environment and its commitment to growth, particularly in its investment management business, which is projected to achieve $100 million in fees in 2024.
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