George J. Carter
About George J. Carter
George J. Carter, age 76, is the founder, Chairman of the Board, and Chief Executive Officer of Franklin Street Properties (FSP), serving as CEO and Chairman since the 2002 conversion to a public REIT; he previously served as President from 2002 to May 2016 and holds a B.S. from the University of Miami . Under his leadership in 2024, FSP executed property dispositions with approximately $100 million in aggregate gross proceeds and repaid approximately $155 million of debt, reducing net debt to $207.649 million from $277.120 million in 2023 . Five-year pay-versus-performance disclosures show FSP total shareholder return (TSR) index values of $54.63 (2020), $84.25 (2021), $40.20 (2022), $38.59 (2023), and $28.18 (2024), alongside net income of $32.615 million (2020), $92.717 million (2021), $1.094 million (2022), $(48.110) million (2023), and $(52.723) million (2024) .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Franklin Street Properties (FSP) | Chairman & Chief Executive Officer | 2002–present | Founder-CEO; responsible for all aspects with emphasis on evaluating, acquiring, and structuring real estate investments . |
| Franklin Street Properties (FSP) | President | 2002–May 2016 | Led operations post-conversion to public REIT, building the platform . |
| Boston Financial Securities, Inc. | President | 1992–1996 | Led real estate investment banking affiliate; transaction execution and capital markets experience . |
| Gloucester Dry Dock | Owner & Developer | Not disclosed | Operating and development experience in an industrial/shipyard asset context . |
| First Winthrop Corporation | Managing Director (Marketing) | 1979–1988 | National real estate and investment banking firm leadership experience . |
| Merrill Lynch & Co.; Loeb Rhodes & Co. | Various brokerage roles | Not disclosed | Early-career securities industry exposure and distribution . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| — | — | — | The proxy indicates no other current public company boards for Mr. Carter (“Other Public Co. Boards: –”) . |
Board Service & Governance
- Board tenure and roles: Director since 2002; Chairman of the Board and CEO; not independent .
- Board leadership structure: CEO and Chairman roles are combined; the company cites efficiency and information flow benefits; mitigations include a Lead Independent Director (Georgia Murray) and fully independent key committees .
- Lead Independent Director: Established in 2014 (Georgia Murray); coordinates independent director activities and investor engagement .
- Committees and independence: Audit, Compensation, and Nominating/Corporate Governance Committees are fully independent; Mr. Carter does not serve on committees .
- Board activity and attendance: Board held seven meetings in 2024; each director attended more than 75% of meetings of the Board and their committees; independent directors hold executive sessions at least annually .
Fixed Compensation
| Year | Base Salary ($) | 401(k) Match ($) | Total Fixed ($) |
|---|---|---|---|
| 2022 | 300,000 | 6,000 | 306,000 |
| 2023 | 300,000 | 6,000 | 306,000 |
| 2024 | 300,000 | 6,000 | 306,000 |
Additional structural elements:
- CEO salary has not increased since February 2015; FSP states base salaries are generally below industry standards .
- No perquisites, deferred compensation, stock options, or restricted stock awards were offered to executives in 2024; the program included base salary, potential discretionary cash bonus, 401(k) match, and a change‑in‑control program only .
Performance Compensation
| Year | Metric(s) used by Committee | Weighting | Target | Actual | Payout to CEO |
|---|---|---|---|---|---|
| 2022 | Subjective evaluation including strategy execution and corporate performance (e.g., FFO, dispositions, debt, leasing, TSR) | Subjective | Not disclosed | Not disclosed | $0 |
| 2023 | Subjective evaluation including strategy execution and corporate performance | Subjective | Not disclosed | Not disclosed | $0 |
| 2024 | Key measures highlighted: net debt, debt repaid, gross proceeds from property dispositions, amount/terms of space leased, FFO, TSR, estimated NAV | Subjective | Not disclosed | Not disclosed | $0 (Committee did not recommend a CEO cash bonus) |
Notes:
- In 2024, the Compensation Committee reduced cash bonuses ~20% for other NEOs vs. 2023 given stock price pressure, dispositions level, debt repayment, and leasing; CEO bonus remained $0 .
- Committee may consider awarding future bonuses in equity instead of cash, though no equity was granted to executives in 2024 and none to executives since 2005 .
- Say‑on‑pay support exceeded 93% in 2021, 2022, and 2023, informing the Committee’s decision to maintain the compensation structure .
Equity Ownership & Alignment
| Holder | Shares Beneficially Owned | % of Outstanding | Notable Details |
|---|---|---|---|
| George J. Carter | 1,008,531 [includes 945,531 held jointly with spouse] | <1% (indicated by “*”) | CEO stock ownership guideline requires 6× base salary; company does not disclose compliance status . |
Additional alignment and overhang considerations:
- No outstanding stock options at FSP; company states “We do not have any outstanding stock options or other securities exercisable or convertible into common stock” .
- No executive equity awards since listing in 2005; 1,365,886 shares remain available under the 2002 stock plan (company-wide) .
- Anti‑hedging policy prohibits hedging and short sales; policy text does not expressly prohibit pledging; no pledges disclosed for Mr. Carter in the beneficial ownership notes .
Implication: Absent equity grants/options, there is no scheduled vesting overhang or option‑driven selling pressure for Mr. Carter; ownership is meaningful in absolute terms but small as a % of shares outstanding, with alignment also supported by a 6× salary CEO ownership guideline .
Employment Terms
| Term | Disclosure |
|---|---|
| Employment agreement | None of the executive officers, including the CEO, has an employment agreement . |
| Severance (non‑change‑in‑control) | FSP is not obligated to pay severance or enhanced benefits upon termination, except in the case of a change‑in‑control program described below . |
| CEO stock ownership guideline | 6× base salary . |
| Clawback policy | Company maintains a clawback policy compliant with NYSE American listing standards . |
| Perquisites | None offered to executives in 2024 . |
| Deferred compensation | Not offered . |
Change‑in‑Control (CIC) Economics
| Component | Trigger | CEO Eligibility | Payout Mechanics |
|---|---|---|---|
| Retention Agreement | Single‑trigger upon closing of a change‑in‑control (fixed payment timing: as soon as practicable, no later than 30 days after closing) | CEO voluntarily elected not to participate | For executive officers (other than CEO): lump‑sum equals 3× base salary plus 3× base salary bonus opportunity; subject to possible tax‑related reduction . |
| Discretionary Pool | Board may set pool = 1% of market cap immediately prior to closing, minus total retention payments; awards discretionary | N/A | As of 12/31/2024, total retention payments >1% of market cap, so no discretionary pool would have been available at that date . |
Performance & Track Record (selected indicators)
- Strategic execution: 2024 dispositions generated ~$100 million in gross proceeds; ~$155 million of debt repaid; ~616,000 square feet leased vs. ~706,000 in 2023; net debt fell to ~$207.649 million (from ~$277.120 million at YE 2023) .
- Pay vs performance summary:
- TSR index (Value of $100): 2020 $54.63; 2021 $84.25; 2022 $40.20; 2023 $38.59; 2024 $28.18 .
- Net income ($): 2020 32,615,000; 2021 92,717,000; 2022 1,094,000; 2023 (48,110,000); 2024 (52,723,000) .
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| FSP TSR Index ($100 base) | 54.63 | 84.25 | 40.20 | 38.59 | 28.18 |
| Net Income ($) | 32,615,000 | 92,717,000 | 1,094,000 | (48,110,000) | (52,723,000) |
| Net Debt ($) | 919,350,000 | 434,249,000 | 406,368,000 | 277,120,000 | 207,649,000 |
Compensation Structure Analysis (governance and incentive quality)
- Simplicity and cash‑heavy mix: FSP pays below‑market salaries (by its assessment), no equity grants since 2005, and discretionary cash bonuses; in 2024, CEO bonus was $0 and other NEO bonuses were cut ~20% vs. 2023 to reflect macro and company performance and to reduce G&A .
- Performance metrics approach: The Committee applies subjective judgment across measures (e.g., net debt, debt repayment, dispositions, leasing, FFO, TSR, estimated NAV), rather than formulaic weightings or targets, which increases discretion risk but provides flexibility in stressed office REIT conditions .
- Equity alignment: CEO is subject to a 6× salary ownership guideline, but there are no ongoing equity awards/vesting schedules (reduces vest‑related selling pressure but limits direct pay‑for‑TSR alignment) .
- Shareholder feedback: Say‑on‑pay exceeded 93% approval in 2021–2023, indicating investor tolerance for the structure given context and cost controls .
Related Party Transactions and Potential Conflicts
- Two of Mr. Carter’s sons are executive officers: Jeffrey B. Carter (President & CIO) and Scott H. Carter (EVP, General Counsel & Secretary); their compensation is disclosed in the Summary Compensation Table and related party transactions section; the company maintains a related‑party transaction review policy overseen by the Audit Committee .
- Compensation Committee interlocks: None disclosed for FSP executives with other public companies’ comp committees .
Equity Ownership & Trading Signals
- No options or RSUs outstanding for Mr. Carter; no executive equity awards since 2005; therefore no scheduled vesting events that could create near‑term selling pressure .
- Anti‑hedging policy restricts hedging/short sales; policy is silent on pledging; no pledges disclosed for Mr. Carter in the beneficial ownership footnotes (one director, not the CEO, has shares in a margin/LOC account) .
Compensation Committee & Peer Framework
- Committee composition: Fully independent; chairs and members disclosed (Compensation Committee chaired by Milton P. Wilkins, Jr.) .
- Advisors and benchmarking: The Committee may retain independent advisors; in 2019, FPL Associates reviewed programs; NAREIT compensation survey used for market context; decisions remain judgment‑based without formulaic weightings .
Say‑on‑Pay & Shareholder Feedback
- Say‑on‑pay approval exceeded 93% in 2021, 2022, and 2023; 2025 proxy seeks annual advisory vote continuation .
Director/Chair Service Considerations (dual‑role implications)
- CEO/Chair combined: The Board defends combined roles for strategy execution and information flow; governance mitigants include a Lead Independent Director, independent committees, and executive sessions .
- Independence: Mr. Carter is not independent; five of six 2025 director nominees are independent .
Multi‑Year CEO Compensation Snapshot
| Year | Salary ($) | Bonus ($) | Stock/Option Awards ($) | All Other ($) | Total ($) |
|---|---|---|---|---|---|
| 2022 | 300,000 | 0 | N/A | 6,000 | 306,000 |
| 2023 | 300,000 | 0 | N/A | 6,000 | 306,000 |
| 2024 | 300,000 | 0 | N/A | 6,000 | 306,000 |
Investment Implications
- Alignment and dilution: Absence of executive equity grants since 2005 minimizes dilution and vesting‑driven selling overhang, but also reduces direct long‑term equity incentive alignment; the 6× salary CEO ownership guideline partially offsets this gap .
- Incentive design in context: Discretionary, cash‑based incentives keyed to deleveraging (net debt), dispositions, and leasing align with near‑term balance sheet and portfolio optimization priorities, yet lack formulaic rigor; CEO’s $0 bonus across 2022–2024 shows restraint consistent with shareholder outcomes and cost control .
- Governance risk flags: Combined CEO/Chair role, family members in senior executive roles, and a single‑trigger CIC program (from which the CEO has opted out) warrant monitoring; mitigants include a Lead Independent Director, independent committees, a compliant clawback, and strong say‑on‑pay support .
- Operational execution: 2024 actions—$100 million in dispositions, $155 million debt repayment, and net debt reduction—are supportive of deleveraging and asset optimization, but TSR and net income trends remain pressured; catalysts rest on leasing velocity, asset sales, and balance sheet progress .