Charles Schreiber Jr.
About Charles Schreiber Jr.
Charles J. Schreiber, Jr. is Chief Executive Officer, President, and a director of KBS Real Estate Investment Trust III, Inc. (KBSR). He has served as CEO since January 2010, director since December 2009, and President since August 2019; he was Chairman of the Board from January 2010 until November 2022 . Age 73 as of April 1, 2025; USC B.S. in Finance (Real Estate emphasis); 50+ years in real estate and 30+ years in real estate-related debt investing . KBSR disclosed going-concern risk in 2024 due to debt maturities, interest rates, and office market headwinds, and suspended dividends/redemptions through March 1, 2026 under loan covenants—key context for assessing performance under his tenure .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The Koll Company | EVP, Acquisitions/Dispositions | Pre-1992 (prior to forming KBS advisors) | Portfolio acquisitions/dispositions leadership foundation for later KBS platforms |
| Koll Investment Management Services | EVP | Pre-1992 | Institutional real estate investment management experience |
| Pacific Development Company | Founder & President | Mid-1970s–1980s | Ground-up development and operating expertise |
| Ashwill-Burke Commercial Brokerage | SVP / SoCal Regional Manager | Prior to Pacific Development | Brokerage leadership; market coverage in SoCal |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| KBS Realty Advisors / KBS Capital Advisors | Chairman & President; oversees all operations | 1992–present (first advisor formed 1992) | Built ~$29.6B cumulative real estate activity across KBS platforms; investor relationships and investment oversight |
| KBS Holdings / Sponsor entities | Indirect control of sponsor and advisor; controls voting rights of the other 50% held by estate of Peter Bren | Ongoing | Central sponsor/advisor control creates economic influence over KBSR’s external management |
| KBS Growth & Income REIT | Chairman, CEO, President, Director (until liquidation Aug-2024) | 2015–2024 | Led affiliated REIT through liquidation; informs disposition/exit processes |
| KBS REIT II | Chairman, CEO, President, Director (until liquidation May-2023) | 2007–2023 | Led another affiliated REIT through liquidation cycle |
| KBS REIT I | Chairman, CEO, Director (until liquidation Dec-2018) | 2005–2018 | Completed full lifecycle REIT liquidation |
| Prime US REIT Manager (Singapore) | Chairman & Director | Jul-2018–Feb-2022 | Oversight of SGX-listed REIT manager; ongoing indirect ownership interest |
| The Irvine Company | Board of Directors & Executive Committee; Board of Trustees | Since Aug-2016; since Dec-2016 | Blue-chip private real estate governance; network and market insight |
Fixed Compensation
KBSR has no paid employees. Executives (including the CEO) are employed and paid by the external advisor (KBS Capital Advisors) and not by KBSR. Accordingly, KBSR pays Mr. Schreiber no salary, bonus, equity or director fees .
| Component | 2023 | 2024 | Notes |
|---|---|---|---|
| Company-paid base salary | $0 | $0 | Executives receive no direct comp from KBSR |
| Company-paid director fees | $0 | $0 | Affiliated directors (including Schreiber) receive no director compensation from KBSR |
| Equity awards from KBSR | None | None | No equity compensation plan in place for officers/directors as of 12/31/2024 |
Performance Compensation
KBSR has no executive incentive plan for its officers. Compensation for executives occurs at the advisor and is not disclosed by metric/weighting at the KBSR level. The conflicts committee oversees executive compensation matters but reiterates that executives are compensated by the advisor .
| Metric | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|
| Not applicable – executives are compensated by the advisor; no KBSR plan exists | — | — | — | — | — |
Advisor-linked retention economics funded by KBSR (impact on incentives/behavior):
- Bonus Retention Fund: KBSR deposited $8.5M (fully funded Dec-2023) into a company-held account; reimburses advisor only upon certain events (liquidation, sale of substantially all assets, non-renewal/termination without cause, qualifying termination, or advisor ceasing to advise a surviving entity in a change-of-control) . Two KBSR executives (not Schreiber) and an affiliated director have allocated awards ($725k, $325k, $1.0M, respectively) that would only be paid upon such triggers; no payments made as of Feb-28-2025 .
- Deferred Asset Management Fees: $8.5M designated as of Sep-30-2022; unpaid amounts become immediately due upon listing, liquidation, sale of substantially all assets, or certain M&A transactions; subject to forfeiture if advisory agreement terminated for cause .
Equity Ownership & Alignment
| Item | 2024 | 2025 | Notes |
|---|---|---|---|
| Beneficial ownership (shares) | 20,857 | 20,857 | Shares are owned by KBS Capital Advisors; Schreiber indirectly controls the advisor |
| % of outstanding | <1% | <1% | Reported as “Less than 1%” in proxy |
| Pledged as collateral | None | None | Proxy indicates none of the shares are pledged |
| Ownership form | Indirect via KBS Capital Advisors | Indirect via KBS Capital Advisors | Reflects control of sponsor/advisor |
| Hedging policy | No hedging policy in place for officers/directors | — | Company disclosed no hedging policy |
| Company equity plans | None | — | No equity plan authorized for officers/directors as of 12/31/2024 |
Implication: Economic alignment with common stock is limited at the KBSR level; influence and economics primarily flow through the external advisory structure rather than direct equity stake .
Employment Terms
| Term | Detail |
|---|---|
| KBSR employment | None; executives are employed by the advisor (external management) |
| KBSR roles and tenure | CEO since Jan-2010; President since Aug-2019; Director since Dec-2009; Chairman Jan-2010–Nov-2022 |
| Advisory agreement | Term expires Sep-27-2025; unlimited 1-year renewals by mutual consent |
| Advisor fee structure | 0.75% annual asset management fee (various bases by asset type) paid monthly; disposition fees up to 1% under conditions; certain fees subordinated to lenders per 2024 subordination agreement |
| Deferred fees | $8.5M Deferred Asset Management Fees outstanding (as of Sep-30-2022) with immediate due-and-payable triggers (listing, liquidation, sale of substantially all assets, qualifying M&A), otherwise payable subject to RMFFO surplus; forfeiture if advisory agreement terminated for cause |
| Bonus Retention Fund | $8.5M fully funded (Dec-2023); reimburses advisor for employee retention payments only upon specified corporate events; residual deemed additional Deferred Asset Management Fees |
| Severance / CoC | No KBSR executive severance; change-of-control economics reside in advisor fee acceleration and Bonus Retention Fund terms, not individual KBSR employment contracts |
| Non-compete / non-solicit | Not disclosed at KBSR level (advisor employment terms not filed) |
Board Governance
- Status: Affiliated director (not independent) under charter; majority of board is independent (Gabriel, Milkovich, Sturzenegger) .
- Committees: Audit and Conflicts Committees are entirely independent; Schreiber is not a member .
- Leadership: CEO role separated from Chairman since Nov-2022; Chairman is Marc DeLuca (CEO of advisor) .
- Dual-role implications: As CEO of KBSR and controlling principal of the sponsor/advisor, Schreiber influences fee structures and recommends independent director compensation through the advisor—managed via an independent Conflicts Committee that approves related-party transactions and oversees advisor performance/compensation .
Director Compensation (context)
- Affiliated directors (including Schreiber) receive no KBSR director fees .
- Independent director pay structure: $135,000 annual retainer; committee fees ($10k members; $20k chairs); incremental per-meeting fees after the 10th meeting; no equity grants .
| Director (2024) | Fees Earned (Cash) |
|---|---|
| Charles J. Schreiber, Jr. (affiliated) | $0 |
Related Party Transactions and Conflicts
- External advisory/fee model: $22.6M asset management fees incurred (Jan-1-2024–Feb-28-2025); $21.0M paid; $18.6M accrued including $8.5M Deferred Asset Management Fees and $8.5M tied to Bonus Retention Fund; reimbursement of certain operating expenses; fee subordination to credit facility lenders (90% payable subject to no Event of Default) .
- Singapore Transaction (SREIT): KBSR sold 11 properties to SREIT in 2019 and holds 237,426,088 SREIT units (18.2%) as of Feb-28-2025; SREIT manager pays fees and is an entity in which Schreiber holds an indirect ownership interest; Schreiber is a former director of the manager; Conflicts Committee approved transaction; Schreiber family trust agreed to sale consent provisions .
- Affiliate lease: KBS affiliate leased space at 3003 Washington Blvd; renewed through Nov-30-2029 at ~$0.3M annualized base rent; deemed fair by Conflicts Committee .
- D&O insurance program shared among affiliates; allocated costs and renewed through Jun-30-2025 .
Performance, Track Record, and Risk
- Portfolio/market headwinds: Board highlighted substantial doubt about going concern in 2024 due to ~$1.2B near-term maturities, high rates, weak U.S. office markets, and required capital raising; distributions and redemptions suspended under loan covenants through Mar-1-2026 .
- Governance controls: Independent Conflicts Committee actively oversees advisor compensation, related-party deals, borrowing in excess of charter limits, and policy reviews; met 7 times in 2024 .
- Advisor fee dynamics: Deferred and retention-linked fees create event-driven payout incentives (e.g., sale of substantially all assets, liquidation) which may influence strategic pathways; Conflicts Committee and fee subordination mitigate some risks .
Compensation Committee Analysis (Conflicts Committee)
- Composition: Independent directors only (Gabriel, Milkovich, Sturzenegger, chair) .
- Mandate: Reviews/approves related-party transactions; supervises/evaluates advisor performance and “compensation”; oversees expense reasonableness; handles compensation oversight in lieu of a separate compensation committee .
Equity Ownership & Alignment (Detail)
| Holder | Shares | % | Notes |
|---|---|---|---|
| Charles J. Schreiber, Jr. | 20,857 (via KBS Capital Advisors) | <1% | None pledged; reflects control of advisor/sponsor rather than direct KBSR equity exposure |
Employment & Contracts (Summary Points)
- No individual KBSR employment agreement, severance, or CoC cash multiples for Schreiber at KBSR; economics reside in advisory contract mechanisms (deferred fee acceleration; retention fund) .
- Advisory agreement: terminable on 60 days’ notice without cause by either party (conflicts committee acting for KBSR), with forfeiture of unpaid Deferred Asset Management Fees upon termination; residual retention fund treated as deferred fees (forfeitable for cause) .
Investment Implications
- Alignment and incentives: Limited direct equity alignment at KBSR level (indirect <1% beneficial holding) and no KBSR equity plan; incentive levers are primarily through advisor fees and event-driven accelerators (Deferred Fees, Bonus Retention Fund), which can bias toward asset sales, merger/liquidation, or similar events if they maximize fee realization, moderated by lender subordination and Conflicts Committee oversight .
- Governance risk: CEO’s dual influence as controlling principal of the sponsor/advisor and as KBSR CEO/Director presents persistent related-party concerns; governance is mitigated structurally (independent audit/conflicts committees; separation of Chairman/CEO since 2022), but independence challenges remain intrinsic to the model .
- Liquidity and balance sheet: Going-concern language, suspended distributions/redemptions, and large near-term maturities elevate execution risk and potential asset-sale pressure—factors relevant for trading around related-party transactions and fee acceleration triggers .
- Trading signals: Watch for 8-Ks on asset sales, extensions/refis, or strategic alternatives; such events can unlock or defer advisor-related economics. Also monitor SREIT stake developments (consents required for Schreiber Trust sales) given affiliation and valuation sensitivity .