James P. Flynn
About James P. Flynn
James P. Flynn is Chairman of the Board and Chief Executive Officer of Lument Finance Trust, Inc. (LFT). He has served as CEO since January 2018, director since March 2019, and Chairman since March 2020; he is 48 years old . Flynn is not independent under NYSE rules and serves alongside a lead independent director structure to mitigate dual-role governance risks . He holds a B.S. magna cum laude in Finance and Accounting from Georgetown University and a J.D. from Columbia Law School, where he was a Harlan Fiske Stone Scholar . Under Flynn’s leadership, as of December 31, 2024, LFT’s loan portfolio comprised 65 senior secured floating-rate loans with $1.066B UPB, weighted average coupon of 8.1%, and weighted average term of 2.1 years; 92.3% of the portfolio was backed by multifamily assets .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Lument Real Estate Capital Holdings, LLC (ORIX USA subsidiary) | Chief Executive Officer | Current | Leads affiliated origination, credit, and asset management platform that supplies investment pipeline to LFT’s external Manager . |
| Hunt Real Estate Capital (formerly Centerline Capital Group) | Executive Management; Investment & Credit Committees | 2007–2020 | Senior leadership in multifamily and CRE lending; platform acquired by Lument in Jan 2020 . |
| Gibson, Dunn & Crutcher LLP | Real Estate Practice Attorney | Prior to 2007 | Legal structuring and transactions in real estate; foundational expertise for credit and investment leadership . |
| Lehman Brothers | Investment Banker | Prior to 2007 | Capital markets and financing experience; informs portfolio and financing strategy . |
External Roles
| Organization | Role | Scope |
|---|---|---|
| Lument Real Estate Capital Holdings, LLC | Chief Executive Officer | ORIX USA subsidiary; affiliated with LFT’s Manager, contributing origination and servicing capabilities . |
Fixed Compensation
LFT is externally managed and does not pay cash or equity compensation to its CEO. Compensation for Flynn is determined and paid by LFT’s external Manager or its affiliates; the Company does not reimburse for CEO compensation.
| Name | Year | Company-paid Base Salary ($) | Company-paid Bonus ($) | Company-paid Stock/Option Awards ($) |
|---|---|---|---|---|
| James P. Flynn | 2024 | — | — | — |
| James P. Flynn | 2023 | — | — | — |
Reference – Company reimbursements for CFO (context for external management economics):
| Executive | Year | Company-reimbursed Compensation Allocable to LFT ($) |
|---|---|---|
| James A. Briggs (CFO) | 2024 | $414,626 |
| James A. Briggs (CFO) | 2023 | $259,333 |
Performance Compensation
The Company does not grant options/stock or pay bonuses to executives; no executive plan grants or outstanding awards exist at year-end. Compensation for Flynn is determined by the external Manager (not disclosed by LFT).
| Item | Detail |
|---|---|
| Company grants to executives | None – no stock options, RSUs, or plan-based awards granted; no outstanding equity awards at FY-end . |
| Insider trading policy | Prohibits short selling, publicly-traded options, and hedging/monetization in LFT securities by directors/officers . |
| Executive clawback policy | Adopted Nov 2023; requires recoupment of erroneously awarded incentive compensation upon financial restatement, fault not required . |
External management incentive framework (alignment risk driver):
| Component | Formula/Terms | 2024 Amount (Approx.) |
|---|---|---|
| Base Management Fee | 1.5% of stockholders’ equity per annum (0.375% per quarter), paid to Manager | ~$4.4 million |
| Incentive Compensation | 20% of core earnings in excess of 8% of stockholders’ equity (per quarter run-rate) | ~$2.2 million |
| Term/Renewal | Initial term ended Jan 3, 2023; auto-renews annually unless terminated per agreement | |
| Termination Fee (non-cause) | 3× the sum of average annual base fee + average annual incentive comp (prior 24 months) |
Implication: Manager’s incentive tied to core earnings can bias toward higher-yield risk assets; base fee is equity-based and not primarily performance dependent .
Equity Ownership & Alignment
| Holder | Shares Owned | % of Outstanding | Pledged Shares | Notes |
|---|---|---|---|---|
| James P. Flynn | 298,220 | <1% (based on 52,324,472 shares) | None pledged | Executive directors receive no board compensation . |
| Shares outstanding (Record Date) | 52,324,472 | — | — | Record date Apr 15, 2025 . |
| Executive unvested awards | None – Company has not granted equity to executives | — | — | — |
Director stock ownership guidelines: Not disclosed; independent directors can elect stock-for-fees in lieu of cash, with reported issuances and prices in 2024 (program mechanics) .
Employment Terms
| Term | Detail |
|---|---|
| Roles & Tenure | CEO since Jan 2018; Director since Mar 2019; Chairman since Mar 2020 . |
| Employment agreements | None – Company has no employment, severance, or change-in-control agreements with executives . |
| Severance/Change-in-control (executives) | None payable by Company to executives . |
| External Manager agreement | Auto-renews annually; termination “for cause” allowed with at least 30 days’ notice; non-cause termination triggers termination fee (3× average base fee + incentive comp over prior 24 months) . |
| Clawback | Executive compensation clawback policy adopted Nov 2023 per NYSE/Rule 10D-1 . |
| Insider trading | Prohibits short selling, options, and hedging transactions in LFT securities . |
| Indemnification | Flynn is party to Company indemnification agreement in the same form as other directors/officers . |
Board Governance
- Board service and independence: Flynn is Chairman and CEO; board determined he and Ms. Reynolds are not independent; majority of board is independent . Lead Independent Director (Houlihan) chairs executive sessions of independent directors .
- Committees: Audit (Houlihan chair; financial expert), Compensation (Keenan chair), Nominating & Corporate Governance (Cummins chair) – all composed exclusively of independent directors .
- Meetings and attendance: Board held 4 meetings in FY2024; no director attended fewer than 75% of meetings; all directors attended the 2024 Annual Meeting .
- Director compensation: Executive directors (Flynn, Reynolds) receive no board fees; independent director cash retainer $100,000 in 2024 (+$10,000 for lead independent director; committee chair retainers) with optional stock-for-fees elections .
- Director designation rights: Lument Investment Holdings (27.4%) designates Flynn and Reynolds; Hunt Companies Equity Holdings designates James C. Hunt; excepted holder limits set by charter .
Performance & Track Record
- Operating platform under Flynn: Focus on transitional floating-rate CRE loans with emphasis on middle-market multifamily; matched-term non-recourse CRE CLO financing reduces margin-call risk .
- Portfolio scale and mix at FY2024: $1.066B UPB across 65 loans; 92.3% multifamily; 8.1% weighted average coupon; 2.1 years weighted average term to maturity .
- 2024 financials (press release context): GAAP net income attributable to common shareholders was $17.9M ($0.34/share) for FY2024; distributable earnings $23.2M ($0.44/share) for FY2024; with ongoing dividend declarations .
Compensation Committee Analysis
- Composition and authority: Independent-only (Cummins, Hunt, Keenan); Keenan is chair. Has sole authority to determine CEO compensation only if Company itself pays compensation (currently Manager pays) .
- Consultants: No compensation consultant engaged for FY2024 because Manager compensates all officers .
- Responsibilities: Oversight of potential executive employment/severance/change-in-control agreements (if applicable), equity plans, and proxy disclosures .
Related Party Transactions & Conflicts
- Management Agreement economics: Base fee and incentive compensation as detailed above; $4.4M base fees and ~$2.2M incentive fees incurred in 2024 .
- Affiliate relationships and servicing: Manager affiliates provide servicing/special servicing; collateral manager roles for CLOs; director designation by Lument IH; registration rights agreements; certain fees waived and reimbursements reduced per chartered arrangements .
- Conflicts highlighted in 10-K: Broad conflicts with Manager/ORIX affiliates across shared personnel, service providers, opportunity allocation, and financing; potential for actions that may not align perfectly with LFT stockholders .
Say-on-Pay & Shareholder Feedback
- Advisory vote on executive compensation presented annually; frequency vote recommended “1 YEAR” by Board .
- Results of votes will be disclosed via 8-K after the annual meeting; not included in proxy at time of filing .
Investment Implications
- Alignment: Flynn’s personal stake is modest (<1%), and Company does not pay him directly; alignment is mediated through the Manager’s incentive structure tied to core earnings above an 8% equity hurdle, which can bias toward higher-yield risk assets .
- Retention risk: No Company severance or change-in-control benefits for executives; retention relies on Manager economics and ORIX/Lument platform—Manager termination fee (3× base fee + incentive comp) creates inertia in structure rather than executive-specific protections .
- Insider selling pressure: Company reports that no directors or executive officers have pledged shares; no Company equity awards outstanding, reducing scheduled vest-related selling; Form 4 activity not disclosed here .
- Governance risk mitigation: Dual-role CEO/Chair balanced by Lead Independent Director and independent-only committees; robust executive sessions and committee oversight .
- Trading signals: Dividends and distributable earnings trajectory are disclosed; CEO commentary on leadership transitions and credit discipline suggests focus on multifamily credit underwriting through cycles; investors should monitor Manager incentive metrics (core earnings) and CLO test performance for cash flow to equity .
Note: LFT is externally managed; executive compensation and detailed performance pay metrics (TSR, revenue/EBITDA targets, option strike/vesting schedules) for Flynn are not disclosed by the Company because they are set and paid by the Manager or its affiliates .