Form 4: Veris Residential COO Receives Performance-Based Equity

Veris Residential's EVP & Chief Operating Officer, Anna Malhari, was granted significant equity awards tied to time, performance, and outperformance metrics.

Summary

• Anna Malhari, Executive Vice President & Chief Operating Officer of Veris Residential, Inc. (VRE), received grants of various restricted stock units (RSUs) on February 19, 2026.
• The grants include 33,693 Time Vesting Restricted Stock Units (TVRSUs), which vest in three equal annual installments starting February 19, 2027.
• An additional 33,692 Performance Vesting Restricted Stock Units (PVRSUs) were granted, with vesting over a three-year period based on the attainment of absolute Total Stockholder Return (TSR) metrics (50%) and the Company's TSR relative to 11 peer REITs (50%). Vesting can range from 0% to 160% of the target.
• Also granted were 33,693 Outperformance Vesting Restricted Stock Units (OPVRSUs), which may vest on February 18, 2029, based on the Company's adjusted funds from operations per share for the fiscal year ending December 31, 2028, with vesting from 0% to 100%.
• Following these transactions, Anna Malhari beneficially owns 135,047 shares in the form of direct ownership of restricted stock units.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a positive development for corporate governance and executive alignment, as a significant portion of the COO's compensation is tied to future company performance and shareholder returns, fostering long-term value creation.

Positives

• The equity grants align the interests of the EVP & Chief Operating Officer directly with long-term shareholder value creation.
• A significant portion of the compensation is performance-based, incentivizing the achievement of specific financial and operational targets, including absolute and relative TSR, and adjusted funds from operations per share.
• The use of peer REITs for relative TSR comparison ensures that performance is measured against industry benchmarks.

Negatives

• The compensation is not immediate cash, and its value is contingent on future company performance and stock price, introducing an element of risk for the executive.
• The vesting schedules extend several years into the future, meaning the full benefit of the grants will not be realized for some time.

Risks

• There is a risk that the Company may not achieve the absolute or relative Total Stockholder Return (TSR) metrics required for the full vesting of PVRSUs, potentially resulting in 0% to 160% vesting.
• The adjusted funds from operations per share target for fiscal year 2028 may not be met, impacting the vesting of OPVRSUs, which can range from 0% to 100%.
• Market conditions and broader economic factors could negatively impact the Company's stock price and financial performance, affecting the value and vesting of all RSU types.

Future Outlook

The equity grants are designed to incentivize the EVP & Chief Operating Officer to drive future performance, with vesting contingent on achieving specific absolute and relative Total Stockholder Return (TSR) targets and adjusted funds from operations per share over multi-year periods. This structure aims to align executive efforts with long-term shareholder value creation.

Industry Context

StockSavvy.ai notes that equity grants, particularly those with performance-based vesting conditions, are a common and effective practice in the REIT sector. This approach aligns executive compensation with long-term shareholder value creation and operational excellence, which is crucial in a capital-intensive and competitive real estate market. The inclusion of both absolute and relative TSR, along with a key operational metric like AFFO per share, reflects a comprehensive approach to performance measurement.

Comparison to Industry Standards

• The structure of these equity grants, incorporating time-based, absolute performance-based, and relative performance-based vesting, is consistent with best practices in executive compensation within the REIT industry.
• Measuring relative Total Stockholder Return (TSR) against a select group of 11 peer REITs is a standard method to ensure that executive performance is benchmarked against direct competitors and broader industry trends, similar to compensation plans seen at companies like Prologis (PLD) or Equity Residential (EQIX).
• The inclusion of adjusted funds from operations (AFFO) per share as a vesting metric is particularly relevant for REITs, as AFFO is a key measure of a REIT's operating performance and dividend-paying capacity, often used by peers such as Simon Property Group (SPG) in their incentive programs.

Corporate Governance

Stakeholder Impact

• Shareholders: Benefit from increased alignment between executive compensation and company performance, potentially leading to enhanced long-term value.
• Employees (Anna Malhari): Receives long-term incentives that are directly tied to the company's success, fostering motivation and retention.

Next Steps

• The Company's performance will be monitored against the absolute and relative Total Stockholder Return (TSR) metrics over the three-year performance period for PVRSUs.
• The Company's adjusted funds from operations per share for the fiscal year ending December 31, 2028, will determine the vesting of OPVRSUs.
• The first installment of TVRSUs is scheduled to vest on February 19, 2027.

Key Dates

Keywords

Veris Residential, VRE, Restricted Stock Units, Equity Grant, Executive Compensation, Performance Vesting, Time Vesting, Outperformance Vesting, REIT, Total Stockholder Return, Adjusted Funds From Operations, Insider Transaction, SEC Form 4