REITs Executive Compensation Guide

Recent Developments

Pay-Versus-Performance

The financial performance measures to be presented in the table are: ■ cumulative total shareholder return (“ TSR ”) for the company; ■ TSR for the company’s self-selected peer group; ■ a financial performance measure chosen by the company and specific to the company that, in the company’s assessment, represents the most important financial performance measure the company uses to link compensation actually paid to the company’s NEOs to company performance for the most recently completed fiscal year. New Item 402(v) also requires disclosure of a list of three to seven financial performance measures that the company determines are its most important measures. Companies are permitted, but not required, to include non-financial measures in the list if they considered such measures to be among their three to seven “most important” measures. ■ the company’s net income; and

On August 25, 2022, the SEC adopted the pay-versus-performance disclosure requirements that the SEC was directed to promulgate by the Dodd-Frank Act. 2 Reporting Companies (other than emerging growth companies (“ EGCs ”)) 3 , registered investment companies, or foreign private issuers, which are all exempt from the rule, will need to comply with these disclosure requirements in proxy and information statements that are required to include Item 402 executive compensation disclosure for fiscal years ending on or after December 16, 2022. New Item 402(v) of Regulation S-K will require that companies provide a new table disclosing specified executive compensation and financial performance measures for the company’s five most recently completed fiscal years. This table will include, for the principal executive officer (“ PEO ”) and, as an average, for the company’s other named executive officers (“ NEOs ”), the Summary Compensation Table measure of total compensation and a measure reflecting “executive compensation actually paid,” as specified by the rule. See Pay-Versus-Performance.

2 See Release No. 34-95607, Pay-Versus-Performance (Aug. 25, 2022), available at https://www.sec.gov/rules/final/2022/34-95607.pdf 3 A company qualifies as an EGC if it had total annual gross revenues of less than $1.235 billion during its most recently completed fiscal year and, as of December 8, 2011, had not sold common equity securities under a registration statement. A company continues to be an emerging growth company for the first five fiscal years after it completes an IPO, unless one of the following occurs: ■ its total annual gross revenues are $1.235 billion or more; ■ it has issued more than $1 billion in non-convertible debt in the past three years; or ■ it becomes a “large accelerated filer,” as defined in Rule 12b-2 under the Securities Exchange Act of 1934.

3 | 2023 Guide to REIT Executive Compensation