Derek Kanehira
About Derek Kanehira
Derek T. Kanehira is Senior Vice President, Human Resources and a 2024 Named Executive Officer (NEO) at Alexander & Baldwin (ALEX) . In 2024 the company delivered diluted EPS of $0.83 and FFO per diluted share of $1.37 (+102.4% and +25.7% YoY respectively), CRE Same-Store NOI growth of 2.87%, and ended with net debt/Consolidated Adjusted EBITDA of 3.6x and liquidity of $333.4M, with ALEX’s value-of-$100 TSR at $101.19 for 2024 . As of Feb 13, 2025, Kanehira beneficially owned 12,533 ALEX shares .
Fixed Compensation
| Item | 2024 |
|---|---|
| Base salary (as of 12/31/24) | $254,870 |
| Target annual bonus (% of salary) | 45% |
| Target annual bonus ($) | $114,692 |
| Actual total cash incentive payout ($) | $166,741 |
2024 cash incentive composition
| Component | Amount ($) |
|---|---|
| Bonus (Individual Goals portion) | $48,687 |
| Non-Equity Incentive Plan Compensation (Financial metrics portion) | $118,054 |
| Total | $166,741 |
Performance Compensation
Annual incentive plan mechanics (AIP for Kanehira; 70% Company metrics, 30% Individual)
| Metric (Weight) | Threshold | Target | Maximum | Actual | AIP Payout Multiple |
|---|---|---|---|---|---|
| FFO per Diluted Share (50%) | $1.03 | $1.07 | $1.13 | $1.37 | 150.0% |
| CRE Same-Store NOI Growth (50%) | 0.90% | 1.90% | 3.00% | 2.87% | 144.1% |
| Company metrics combined (70% weight) | — | — | — | — | 147.0% |
| Individual Goals (30% weight) | — | — | — | Between target and max | Between target and max |
Result: Kanehira’s total AIP payout equaled 145% of target (65% of base salary), or $166,741 .
Long-term incentives (LTI) – 2024 design and grant
| Item | Detail |
|---|---|
| 2024 target LTI value | $110,000 |
| Vehicle mix | 30% PSUs / 70% RSUs |
| PSU metrics (3-year, cliff vest) | 75% TSR vs Selected Peer Group; 25% Net Debt/TTM Consolidated Adjusted EBITDA |
| PSU performance grid | TSR: 35th/50th/75th percentile = 35%/100%/200% payout; Leverage: 6.0x/5.6x/5.0x = 35%/100%/200% payout (linear interpolation) |
| RSU vesting | Service-based, vest in thirds over 3 years |
| 2024 grant quantities (PSUs at target; RSUs) | PSUs: 1,893 target (663 thr; 3,786 max); RSUs: 4,417; grant-date fair value $112,463 |
| Options | None granted; company has not granted options since 2012 |
Stock awards vested in 2024
| Metric | 2024 |
|---|---|
| Shares vested (stock awards) | 5,614 |
| Value realized on vesting | $97,852 |
| Option exercises | None in 2024 (no outstanding options) |
| Source |
Equity Ownership & Alignment
| Ownership snapshot | Value |
|---|---|
| Beneficial ownership (2/13/2025) | 12,533 shares |
| % of shares outstanding (72,711,414 at 2/13/2025) | ~0.017% (12,533 / 72,711,414) |
| Unvested RSUs (12/31/2024) | 8,111 units; $143,889 value (at $17.74) |
| Target PSUs unvested (12/31/2024) | 4,991 units; $88,540 value (at $17.74) |
| Options outstanding | None |
| Ownership guidelines | CEO 5x salary; other NEOs 3x salary; 5 years to comply; all NEOs are in compliance or on track |
| Hedging/derivatives policy | Hedging and speculative transactions prohibited |
Vesting schedules (unvested as of 12/31/2024)
| Award | Vesting dates and units |
|---|---|
| RSUs | 1,127 on 2/1/2025; 1,283 on 2/2/2025; 1,284 on 2/1/2026; 1,472 on 2/1/2025; 1,472 on 2/1/2026; 1,473 on 2/1/2027 |
| PSUs (shown at target) | 1,448 on 2/1/2025; 1,650 on 2/1/2026; 1,893 on 2/1/2027 (subject to performance) |
Notes:
- Market value for unvested awards uses $17.74 (12/31/2024 close) as disclosed .
- No disclosure of any pledged shares; the company prohibits hedging; options are not used .
Employment Terms
| Topic | Key terms |
|---|---|
| Employment agreements | None; at-will employment for NEOs |
| Severance Plan (non-CIC) | If involuntary termination without cause or RIF: 12 months base salary; COBRA and life/disability premiums up to 12 months; outplacement; prorated target annual incentive (subject to release) |
| CIC agreements | Double-trigger; 2x (base salary + target bonus); pro rata target for in-flight performance awards; continued benefits for 2 years or cash equivalent; outplacement up to $10,000; best‑net cutback (no excise tax gross‑ups) |
| Clawback policy | Dodd-Frank compliant (adopted Oct 2023) covering Section 16 officers, plus legacy policy covering earlier awards |
| Option treatment | No options outstanding (company does not grant options) |
Derek T. Kanehira – potential payments by scenario (as of 12/31/2024)
| Scenario | Cash severance | Health & welfare | Outplacement | LTI acceleration | Total |
|---|---|---|---|---|---|
| Change in Control + Qualifying Termination | $739,123 | $34,760 | $10,000 | $223,619 | $1,007,502 |
| Termination without Cause | $254,870 | $14,667 | $10,000 | — | $279,537 |
| Death | — | — | — | $174,597 | $174,597 |
| Disability | — | — | — | $174,597 | $174,597 |
| Retirement | Not yet eligible | — | — | $174,597 | $174,597 |
Deferred compensation and pension
| Item | 2024 |
|---|---|
| Executive contributions | $7,581 |
| Company contributions | $0 |
| Aggregate earnings | $168 |
| Aggregate balance (FYE) | $7,750 |
| Pension (Excess Benefits Plan) | Not a participant; $0 present value |
Compensation Structure Analysis
- Pay-for-performance linkage: Other NEOs (incl. Kanehira) targeted 59% of compensation as performance-based in 2024; Say-on-Pay approval >96% signals investor support .
- Annual incentive rigor: Company metric portion (70% weight) paid at 147% of target on FFO/share and Same-Store NOI, while individual goals for Kanehira were rated between target and maximum; overall payout 145% of target (65% of salary) .
- LTI design mix: Kanehira’s 70% RSUs / 30% PSUs skews toward retention while maintaining performance exposure via relative TSR and leverage (net debt/EBITDA) over 3 years .
- Governance safeguards: Double-trigger CIC, best-net cutback (no gross-ups), robust clawback, hedging ban, no options or repricing; equity grants on a set cadence (Feb 1) .
Compensation peer inputs (used for benchmarking and PSU relative TSR)
- The company references WTW and Nareit surveys and a Selected Peer Group including shopping center/diversified/specialty/industrial REITs (e.g., AKR, AAT, AHH, IVT, JBGS, OLP, PECO, PLYM, ROIC, SAFE, BFS, SITC, UE, WSR) .
- 2022 PSU vesting outcome was 47% based on TSR vs FTSE Nareit All-Equity REIT index and the Selected Peer Group .
Investment Implications
- Alignment and retention: Kanehira’s structure combines formulaic, property-level value drivers (FFO/share, Same-Store NOI) with individual objectives and a 70% RSU LTI mix that promotes retention and steady ownership accumulation; 30% PSUs provide multi-year performance alignment to TSR and leverage discipline .
- Vesting calendar and potential supply: Concentrated vesting events (notably around Feb 1 annually) across 2025–2027, with 8,111 RSUs and 4,991 target PSUs outstanding at 12/31/2024, can create periodic settlement-related supply; 5,614 shares vested in 2024 (no options outstanding) .
- Downside protection for shareholders: Double-trigger CIC with best-net reductions, absence of gross-ups, robust clawback, and hedging prohibitions reduce governance risk and mitigate shareholder-unfriendly outcomes .
- Ownership and guidelines: Beneficial ownership of 12,533 shares plus unvested equity, combined with 3x salary ownership guideline and on-track compliance, indicate increasing “skin in the game” over time .