James Farrar
About James Farrar
James Farrar, age 49, is Chief Executive Officer (PEO) of City Office REIT, Inc. (CIO) and has served on the Board since the company’s IPO in April 2014. He previously launched Second City Real Estate’s private equity platform and held investing roles at a family office and TD Capital; he holds a BBA from Wilfrid Laurier University and is a Chartered Accountant, Chartered Business Valuator, and CFA charterholder . Under his tenure, 2024 results included 806,000 sq ft of leasing, occupancy rising to 85.4% (from 84.5% in 2023), a 5.9% cash re-leasing spread, and Same Store Cash NOI growth of 0.1% . Total shareholder return (TSR) was -2.7% in 2024 vs +4.2% for the Dow Jones U.S. Real Estate Office Index; 5-year TSR was -41.7% vs -31.6% for the index .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Second City Real Estate | Managing Director (launched real estate PE platform) | Joined Oct 2009 | Involved in >$3.0B of commercial real estate acquisitions |
| Family office (diversified portfolio) | Vice President | Pre-2009 | Focused on real estate and hospitality |
| TD Capital (TD Bank PE unit) | Investment professional | Pre-2009 | Private equity investing experience |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| City Office REIT, Inc. | Director | Since IPO (Apr 2014) | Executive director; CEO |
Board Governance
- Board size 6; five independent directors; Farrar is the sole non-independent director as CEO .
- Board leadership is separated: independent Chair (John Sweet); CEO role held by Farrar; structure intended to focus CEO on operations and Chair on board leadership .
- Committee memberships: Farrar is not on Audit, Compensation, Nominating, or Investment Committees; all committees are independent .
- Attendance: all incumbent directors attended ≥75% of board/committee meetings; directors attended the 2024 annual meeting .
- Director pay: Farrar receives no additional compensation for director service .
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary (CEO) | $525,000 | $525,000 |
Multi-year compensation summary (CEO):
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | $475,000 | $525,000 | $525,000 |
| Bonus/Annual Cash Incentive ($) | $475,000 | $551,250 | $656,250 |
| Stock Awards ($, grant-date fair value) | $2,067,352 | $1,203,940 | $1,054,368 |
| All Other Comp ($) | $101,188 | $98,198 | $91,017 |
| Total ($) | $3,118,540 | $2,378,388 | $2,326,635 |
Performance Compensation
Annual incentive design and scoring:
- Annual cash incentive opportunity ranges from 0–200% of base salary, determined by Compensation Committee scoring of pre-set Performance Objectives (Operations; Share Performance & Liquidity; Financial Measures such as Core FFO/NOI/dividend coverage/leverage; Acquisitions & Divestitures; Capital Markets/Sustainability/IR) with each objective measured 0–200% and 100% as target .
- 2024 annual cash incentive paid to Farrar: $656,250 .
Time-vesting RSUs (2024 grants):
| Grant Type | Grant Date | Units | Grant-date Value |
|---|---|---|---|
| Time-vested RSUs (3-year ratable) | Jan 24, 2024 | 73,289 | $399,425 |
| Dividend-equivalent RSUs (in-kind) | Jan 24/Apr 24/Jul 24/Oct 24, 2024 | 2,417 / 3,047 / 2,514 / 2,553 | $13,173 / $13,925 / $14,229 / $14,476 |
Performance RSUs (2024 grants):
| Grant Type | Measurement Period | Peer Construction | Payout Curve | Units | Grant-date Value |
|---|---|---|---|---|---|
| Performance RSUs (cliff after 3 yrs) | Jan 1, 2024 – Dec 31, 2026 | Office REIT peer group as of Dec 31, 2024 | 50% at 30th pct; 100% at 50th; 150% at 75th+ (interpolated) | 109,934 | $599,140 |
| Dividend-equivalent PRSUs (in-kind during 2024) | Same as above | Same | Paid in-kind and vest with PRSUs | 17,197 | $91,017 |
Performance RSU payout earned in 2024 (from 2022 grant):
| Grant Year | Measurement Period | TSR Outcome | Percentile | Target Units | Earned Units |
|---|---|---|---|---|---|
| 2022 grant | Jan 1, 2022 – Dec 31, 2024 | -61.3% TSR | 26th pct | 37,500 | 18,750 |
2025 year-to-date equity awards (approved for 2024 performance):
| Award Type | Units (CEO) | Notes |
|---|---|---|
| Time-vested RSUs | 60,000 | Approved Jan 23, 2025 |
| Performance RSUs | 90,000 | Measurement: Jan 1, 2025 – Dec 31, 2027 |
Key program features and governance:
- Since 2023, long-term equity mix set at 40% time-vested RSUs / 60% PRSUs (relative TSR), increasing performance linkage .
- No stock options granted since IPO; equity delivered via RSUs/PRSUs with dividend equivalents .
- May 2024 Acknowledgment Agreements for Farrar/Tylee ensure EIP annual grant limits aren’t exceeded; dividend equivalents paid in cash if needed to comply .
- Clawback policy (Rule 10D-1) applicable to cash bonus and equity awards; hedging prohibited .
Performance linkage summary (selected 2024 metrics):
| Metric | 2024 Result |
|---|---|
| Leasing executed | 806,000 sq ft |
| Occupancy (year-end) | 85.4% (vs. 84.5% in 2023) |
| Cash re-leasing spread | 5.9% |
| Same Store Cash NOI growth | 0.1% |
| TSR (calendar 2024) | -2.7% (vs +4.2% DJ US RE Office Index) |
| TSR (5 years to 12/31/24) | -41.7% (vs -31.6% index) |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (CEO) | 701,090 shares; 1.7% of outstanding (40,358,240 shares o/s) |
| Unvested RSUs/PRSUs (12/31/24) | 369,738 units; market value $2,040,954 at $5.52/share |
| Ownership guidelines | CEO: 4x base salary; Directors: 3x board cash retainer (5-year compliance window) |
| Hedging/Pledging | Hedging in company equity is prohibited; Insider Trading Policy with pre-clearance and trading windows |
| EIP share pool | Proposal to increase max shares from 3,763,580 to 5,763,580 under EIP (potential dilution) |
Vesting cadence and supply implications:
- Time-vested RSUs generally vest in three equal tranches on the first three anniversaries of grant (e.g., Jan 24, 2025/2026/2027 for 2024 grants) .
- PRSUs cliff-vest at end of 3-year period based on relative TSR; dividends accrue and settle pro rata with earned shares .
Employment Terms
Without Cause termination / Resignation for Good Reason (CEO):
| Component | Amount |
|---|---|
| Base salary (1x) | $525,000 |
| Avg bonus (prior 2 yrs, 1x) | $513,125 |
| Prorated prior-year bonus | $551,250 |
| Avg EIP grant (prior 2 yrs, 1x) | $1,129,154 |
| Health coverage | 12 months |
| Equity | Immediate vesting of all outstanding awards |
| Total illustrative (as of 12/31/24) | $2,718,529 |
Change in Control (CIC) economics (CEO):
| Component | Amount |
|---|---|
| Equity vesting on CIC | All outstanding awards vest immediately (single-trigger) |
| If resign for Good Reason within 12 months post-CIC: | |
| Base salary (2x) | $1,050,000 |
| Avg bonus (2x) | $1,026,250 |
| Prorated prior-year bonus | $551,250 |
| Avg EIP grant (2x) | $2,258,308 |
| Health coverage | 12 months |
| Total illustrative (as of 12/31/24) | $4,885,808 |
Death/Disability (CEO):
| Component | Amount |
|---|---|
| Equity vesting | 369,738 units; $2,040,954 at $5.52/share |
Contractual notes:
- Equity acceleration upon CIC is single-trigger under the EIP; cash severance is double-trigger (Good Reason within 12 months of CIC) .
- Non-compete/non-solicit specifics not disclosed; disability provisions reference British Columbia Human Rights Code and continued vesting with restrictions .
Say-on-Pay, Peer Benchmarking, and Committee Oversight
- Say-on-pay: 81% approval at the 2024 annual meeting .
- Say-on-frequency: annual (one year) supported (~85% in 2020) .
- Benchmarking: Performance compared to Dow Jones U.S. Real Estate Office Index; pay levels benchmarked using NAREIT/Ferguson Partners survey with focus on similarly sized REITs and office REITs .
- Compensation Committee: fully independent; did not retain an external consultant in 2024; administers EIP and sets annual goals .
Compensation Structure Analysis
- Increased performance at-risk mix: Since 2023, PRSUs are 60% of LTI with relative TSR as sole metric (50–150% payout), tightening alignment with shareholder returns in a challenged office REIT cycle .
- Cash vs equity: Below-market base salary philosophy with upside driven by performance-based cash and equity; 2024 bonus rose to $656k despite negative TSR, reflecting operational achievements and revised guidance attainment .
- No options/repricing: Company has not granted options since IPO; no option repricing disclosed .
- Governance safeguards: Hedging ban; SEC-compliant clawback; ownership guidelines; acknowledgement agreements to enforce EIP annual limits; independent committee oversight .
Performance & Track Record (selected)
| Indicator | 2024 Outcome |
|---|---|
| Leasing volume | 806,000 sq ft (new + renewals) |
| Occupancy | 85.4% YE 2024 vs 84.5% YE 2023 |
| Cash re-leasing spread | 5.9% |
| Same Store Cash NOI | +0.1% |
| Liquidity actions | Two mortgage renewals; maintained liquidity and unencumbered assets |
| Capital recycling | Signed 2024 PSA for Superior Pointe; closed post year-end |
| Redevelopment pipeline | Advancing entitlements for ~49-story tower at City Center (St. Petersburg) |
| TSR (2024 / 5-year) | -2.7% / -41.7% vs index +4.2% / -31.6% |
Equity Ownership & Alignment Details (Breakdown)
| Category | Amount |
|---|---|
| CEO beneficial shares | 701,090 (1.7% of 40,358,240 o/s) |
| Unvested equity at YE 2024 | 369,738 units; $2,040,954 at $5.52 |
| 2024 RSU grants (time) | 73,289 units; 3-year ratable vest |
| 2024 PRSU grants (performance) | 109,934 target units; cliff at 12/31/2026 (50–150% payout) |
| 2025 YTD awards | 60,000 RSUs; 90,000 PRSUs (2025–2027) |
Employment Terms (Key Triggers)
- Severance (no cause/good reason): cash equal to 1x salary, 1x avg bonus (2 yrs), prorated prior-year bonus, 1x avg EIP grant (2 yrs), 12 months health; full equity vesting .
- CIC: single-trigger full equity vesting at change; additional double-trigger cash benefits if good reason resignation within 12 months .
Investment Implications
- Alignment positives: High equity exposure (large unvested RSUs), 60% PRSU LTI tied to relative TSR, ownership and hedging policies, and clawback improve pay-for-performance alignment .
- Pressure points: Single-trigger equity acceleration on CIC and immediate vesting on no-cause/good-reason termination can create downside protection for the CEO and potential dilution on change events; EIP share pool increase adds future supply risk .
- Performance execution: Despite negative TSR, 2024 operational progress (leasing, occupancy, spreads) and liquidity actions supported above-prior-year bonus; monitoring future PRSU outcomes (2026/2027 cliffs) and vesting dates (annual RSU tranches) is pertinent for supply/tax-related selling dynamics .
- Governance: Independent chair and committees, no options or repricing, and documented committee oversight reduce governance risk; say-on-pay support (81%) provides shareholder validation of structure .