Steven Katz
Executive Vice President and Chief Investment Officer — Residential Financing at ARBOR REALTY TRUST
Executive
About Steven Katz
Steven Katz (age 54) serves as Executive Vice President and Chief Investment Officer — Residential Financing at Arbor Realty Trust (ABR), responsible for growing Arbor’s presence in residential real estate, including its Single-Family Rental (SFR) portfolio platform . He brings 20+ years in mortgage trading, securitization, banking and servicing, previously as a Morgan Stanley Managing Director (led residential loan trading and lending) and as CEO/CIO of Seneca Mortgage; he also previously served as CIO for Arbor Residential Mortgage . Company performance context: in 2024, Arbor’s cumulative TSR (value of a $100 investment from 12/31/2019) measured 164 vs 80 for FTSE Nareit Mortgage REITs; 2024 net income was $283.9M and distributable earnings were $358.0M (2023: $400.6M and $452.5M, respectively) .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Morgan Stanley | Managing Director, led residential loan trading and lending | Not disclosed | Led residential loan trading/lending groups, directly relevant to Arbor’s SFR/residential financing expansion |
| Seneca Mortgage (privately held entities) | CEO and Chief Investment Officer | Not disclosed | Ran residential mortgage servicing and investments, strengthening Katz’s mortgage servicing/investments expertise |
| Arbor Residential Mortgage (prior capacity) | Chief Investment Officer | Not disclosed | Prior Arbor experience in residential mortgage investment supports current CIO–Residential Financing mandate |
Fixed Compensation
| Component | 2023 | 2024 |
|---|---|---|
| Salary ($) | 2,086,555 (includes $1,586,555 of commissions) | 1,383,010 (includes $883,010 of commissions) |
| All Other Compensation ($) | 6,600 (401(k) match and basic life insurance) | 6,870 (401(k) match and basic life insurance) |
| Life insurance coverage | $250,000 basic; additional $250,000 due to participation in deferred comp plan | $250,000 basic; additional $250,000 due to participation in deferred comp plan |
Notes:
- NEOs (including Katz) are eligible for 401(k) with company match and long-term disability; Katz’s “All Other Compensation” captures these standard benefits .
- Katz participates in the Employee Deferred Compensation Plan (details below), which also provides an additional $250,000 life insurance benefit .
Performance Compensation
| Incentive type | Metric framework | Weighting | Target | Actual/Payout | Vesting |
|---|---|---|---|---|---|
| Annual cash incentive (2023) | Discretionary; no pre-set goals for NEOs | N/A | N/A | $1,465,000 paid for managing SFR platform | Cash |
| Annual cash incentive (2024) | Discretionary; no pre-set goals for NEOs | N/A | N/A | $1,465,000 paid for managing SFR platform | Cash |
| Stock awards for 2023 performance (granted 3/14/2024) | Restricted stock | N/A | N/A | 39,032 shares; grant-date FV $494,926 | Multi-year; see vesting below |
Key points:
- For 2024, the Compensation Committee did not establish specific performance-based goals for NEOs other than the CEO; NEO awards are determined relative to individual contributions and responsibilities .
- Stock awards for NEOs generally vest one-third at grant, and one-third on each of the first and second anniversaries; 2025 grants for 2024 performance follow this schedule (one-third at grant; one-third at year 1; one-third at year 2) .
Equity Ownership & Alignment
| Ownership and awards | Detail |
|---|---|
| Common shares beneficially owned | 178,019 shares; <1% of outstanding |
| Unvested restricted stock at 12/31/2024 | 30,364 shares; market value $420,541 at $13.85 per share |
| Scheduled vesting from 12/31/2024 | 17,352 shares in March 2025; 13,012 shares in March 2026 |
| Stock vested in 2024 | 17,349 shares; value realized $222,327 |
| Dividends on restricted stock | Cash dividends paid on all outstanding restricted shares (2024 rate: $1.72 per share) |
| Stock ownership guidelines (adopted 3/6/2025) | NEOs must hold ABR stock valued at 5x base salary by 12/31/2027; value measured at higher of 12/31 price or average of quarter-end prices; new shortfalls have 2–3 years to cure |
| Hedging/pledging | Prohibited for covered employees (includes NEOs); no derivatives, pledging, or hedging of ABR stock |
| Deferred compensation (2024) | Executive contribution: $327,867; employer contribution: $362,784; earnings: $15,794; aggregate balance: $2,158,928; includes $1,168,258 of unvested employer contributions |
Implications:
- Prohibition on pledging/hedging reduces forced selling/overhang risk and aligns with long-term ownership .
- New 5x-salary ownership guideline by 12/31/2027 increases alignment and may decrease selling pressure into that date .
- Dividends on unvested restricted stock provide current income, potentially reducing the need for share sales .
Employment Terms
- Employment status: At-will; ABR’s NEOs (other than the CEO) do not have individual employment, severance or change-of-control cash agreements .
- Change-in-control equity treatment: Restricted stock award agreements provide for full vesting upon a Company “change of control”; if a change in control occurred on 12/31/2024, Katz’s unvested restricted stock would have vested with a market value of $420,541 (at $13.85 close) .
- Clawback: Executive officer clawback policy to recover erroneously awarded incentive compensation following an accounting restatement, per NYSE rules .
- Insider trading policy: Covers directors, officers and employees; prohibits selective disclosure and governs trading windows and conduct .
Investment Implications
- Pay-for-performance alignment: Katz’s compensation emphasizes variable cash incentives tied to role impact (SFR platform) and multi-year restricted stock, with dividends on unvested shares; combined with a 5x-salary ownership requirement by 2027 and a strict no-pledging policy, alignment with long-term shareholders is strengthening .
- Vesting/selling pressure: As of 12/31/2024, 30,364 unvested shares are scheduled to vest through March 2026 (17,352 in March 2025; 13,012 in March 2026); while these events can add episodic supply, the ownership guidelines and dividend-paying RS reduce near-term sell pressure incentives .
- Retention risk: Absence of cash severance is balanced by meaningful unvested equity, deferred compensation with unvested employer contributions, and the ownership guideline timetable, which together support retention .
- Governance safeguards: Clawback provision and prohibition on hedging/pledging reduce risk of misaligned incentives and leverage-related selling; change-in-control equity acceleration is standard but should be monitored for potential windfalls in strategic scenarios .