Investors seek reforms of home-builder CEO pay

BIG PAYCHECKS

CEOs in the building industry collectively earned hundreds of millions of dollars during the real estate boom, helped by a low-interest-rate environment that allowed many new home buyers to obtain financing.

For instance, Robert Toll, who has been one of the best paid chiefs in corporate America, received $92.3 million in salary, bonuses and nonequity incentive pay alone during the 2002-to-2005 period, according to data compiled by compensation services firm Salary.com Inc.

Another high earner, MDC Holdings Inc CEO Larry Mizel, collected about $64 million during the same period, according to the data.

The Salary.com figures do show declines in CEO pay at eight big builders Beazer, Centex Corp, D.R. Horton, Lennar, MDC Holdings, Pulte Homes Inc, Ryland and Toll in 2006 from the prior year. KB Home also paid its top official less, but comparisons are difficult because the company had appointed a new CEO in November 2006. (See related FACTBOX by clicking (ID:nN01455420: Quote, Profile, Research))

The figures include salary, bonus and nonequity incentives, but not extras like stock awards and restricted shares, which have the potential to add millions more to overall pay.

Nor do the year-over-year declines mean last year's payouts were small. Toll, for instance, saw his salary and bonus fall to $18.8 million from $28.6 million, but that was still more than double the $8.3 million that General Electric Co (GE.N: Quote, Profile, Research) CEO Jeffrey Immelt received in bonus and salary in 2006.

At Toll Brothers, there is little expectation that the CEO will get a significant bonus, based on financial results through the first nine months of the fiscal year.

"I doubt very much that the metrics would yield any significant bonus," Chief Financial Officer Joel Rassman said. "It may not be any bonus."

Representatives of other home builders pointed to their last proxies for details on how compensation is calculated.