Matthew Koart
PULTEGROUP INC/MI/About Matthew Koart
Executive Vice President and Chief Operating Officer of PulteGroup since May 18, 2023; nearly 30 years in residential real estate spanning homebuilding operations and land acquisition/development. He previously led Shapell Industries as CEO and founded Koart Residential; he holds both a BS and JD from the University of Southern California and was age 59 at appointment in 2023 . Under the management team’s 2024 performance, PHM delivered record home sale revenues of $17.3B, diluted EPS of $14.69, ROE of 27.5%, 31,219 homes closed, $1.7B cash from operations, and debt-to-capital of 11.8%; 5-year TSR reached $296.48 on a $100 base, highlighting strong value creation through the cycle .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Koart Residential, Inc. | Founder/President | 2011–2023 | Sourced, entitled, developed residential real estate; supplied lots to production builders |
| Shapell Industries | Chief Executive Officer | 2008–2011 | Led diversified real estate company (residential and commercial) through late-cycle dynamics |
| PulteGroup (prior tenure) | Division/Region/Area President | 1996–2008 | Operated large divisions; advanced through operating leadership roles |
Fixed Compensation
| Component (2024 unless noted) | Detail | Amount/Term |
|---|---|---|
| Base salary | EVP & COO | $750,000 |
| Annual Program target | Percentage of salary (target) | 70% ($525,000 target; max $1,050,000) |
| Monthly living stipend | Stipend in 2024 | $12,000/month |
| Financial counseling, life insurance, executive physical | Perquisites | Provided; 401(k) match $13,800 |
| Non-Qualified Deferral Program | Balance at FY-end; 2024 earnings/withdrawals | $151,410 balance; $8,504 earnings; $30,860 withdrawals |
Performance Compensation
Annual Incentive – 2024 design and results (company-level metrics)
| Metric | Weight | Threshold | Target | Max | 2024 Actual | Payout of target |
|---|---|---|---|---|---|---|
| Adjusted Pre-Tax Income | 50% | $2,643,449k | $3,304,311k | $3,965,173k | $4,260,858k | 200% |
| Operating Margin % | 50% | 16.7% | 19.7% | 22.7% | 22.8% | 200% |
| Aggregate payout (company) | — | — | — | — | — | 200% |
Executive-level payouts – 2024
| Program | Target for Koart | Actual payout |
|---|---|---|
| Annual Program (short-term cash) | $525,000 | $1,050,000 |
| Pre-Tax Income Profit Participation Program (cash) | 0.0409% of APTI × relative modifier | $1,979,294 (APTI $4,260,858k; modifier 113.7%) |
Pre-Tax Income Profit Participation Program mechanics (2024)
- Target payout percentage: 0.0409% for Koart .
- 2024 Adjusted Pre-Tax Income: $4,260,858k; PHM ranked 4th among peers, modifier 113.7% .
- Actual payout (rounded as disclosed): $1,979,294 .
Long-Term Incentives (LTI)
| Grant/Program | Instrument | Metric/Weighting | Grant detail | Vesting |
|---|---|---|---|---|
| 2024–2026 LTI Program | PSUs | Relative TSR (1/3), Relative ROE (1/3), Relative Operating Margin (1/3) vs homebuilder peer group | Target value $1,575,000; target shares 14,858 (max 29,716) | Cliff vest after 3-year performance period; settled in shares |
| 2024 annual grant | RSUs | Service-based | 9,905 RSUs | 3-year cliff vest (Jan 31, 2027) |
| 2025–2027 LTI Program (granted Feb-2025) | PSUs | Same as above (relative TSR/ROE/Op Margin) | Target value $1,605,000; target shares 14,389 | 3-year performance period |
| 2025 annual grant | RSUs | Service-based | 9,593 RSUs; value $1,070,051 | 3-year cliff vest from grant |
Notes:
- 2022–2024 LTI Program paid out at 189.5% of target, but PHM explicitly states Koart was not employed in 2022 and therefore did not participate in that cycle .
Equity Ownership & Alignment
Beneficial and outstanding equity (as of FY-end/record dates)
| Category | Amount |
|---|---|
| Beneficial ownership (Mar 6, 2025) | 34,143 shares |
| Unvested RSUs (Dec 31, 2024) | 24,550 units |
| Unearned PSUs outstanding (at “maximum” reporting basis) | 58,352 units |
| Shares outstanding (Mar 6, 2025) | 201,585,399 |
Vesting schedule (selected disclosed lots)
| Vest Date | Instrument | Units |
|---|---|---|
| Jan 31, 2026 | RSU | 327 |
| May 18, 2026 | RSU | 14,318 |
| Jan 31, 2027 | RSU | 9,905 |
| Dec 31, 2025/2026 (after performance period) | PSU (2023–2025; 2024–2026) | Settle based on relative metrics; 2024–2026 targets shown above |
Alignment policies and risk controls
- Stock ownership guidelines: CEO 6× salary; other NEOs 3× salary. All continuing NEOs have met or are within the five-year compliance window .
- Hedging and pledging: Prohibited for directors and executive officers under Insider Trading Policy .
- Options: None outstanding for any NEOs at FY-end 2024 (reduces leverage and repricing risk) .
- Equity plan safeguards: Plan prohibits repricing of underwater options and granting discounted options .
Employment Terms
- Appointment/Offer: Named EVP & COO effective May 18, 2023; initial offer included $750,000 base salary, 2023 AIP target $1,250,000 (pro-rated), 2023 LTI target $2,000,000 split 50% RSUs/50% PSUs, and a $3,500 monthly living stipend; eligible for Executive Severance Policy and executive programs (tax/financial planning; health exam) .
- Severance policy (effective 2024 amendments): For NEOs with <5 years’ service (Koart), severance equals 1/12 of base salary × 18; change-in-control (CIC) qualifying termination adds a bonus amount equal to 1/12 of target bonus × 18; removed pro rata vesting for performance-based equity upon ordinary qualifying termination; retirement and CIC treatment detailed below .
Quantified separation/CIC scenarios (as of Dec 31, 2024)
| Scenario | Cash severance | Annual incentive (per policy) | Acceleration of LTI awards | Acceleration of RSUs | Total benefits |
|---|---|---|---|---|---|
| Involuntary termination without cause | $1,125,000 | $3,029,294 | $2,949,847 | $2,701,071 | $9,843,357 |
| CIC + qualifying termination | $1,125,000 | $3,029,294 (CIC formula applied) | $3,177,266 | $2,701,071 | $10,032,631 |
Clawbacks and conduct
- Dodd-Frank clawback adopted (no-fault recovery upon covered restatements); additional discretionary misconduct/detrimental conduct clawback up to 36 months of incentive/equity value .
Related party/Conflicts safeguards
- Pre-existing minority interests disclosed; escrow payment of ~ $175,000 to Koart’s entity on Dec 29, 2023; Board granted a limited waiver with a wind-down period and implemented safeguards; as of Mar 14, 2025 one development property sold and the last portion of the other under contract .
Performance Compensation – Design Detail
| Program | Metric | Weight | Target-setting/Peer construct | 2024 outcome |
|---|---|---|---|---|
| Annual Program (cash) | Adjusted Pre-Tax Income | 50% | Absolute targets reflecting macro volatility | 200% payout |
| Operating Margin | 50% | Absolute targets | 200% payout | |
| Pre-Tax Income Profit Participation (cash) | Adjusted Pre-Tax Income (absolute) with relative growth modifier | — | Target % of APTI for execs; modifier by rank vs DHI, LEN, NVR, TOL, KBH, MTH, TMHC, TPH, MHO | Rank 4, modifier 113.7%; Koart payout $1,979,294 |
| LTI PSUs (equity) | Relative TSR | 33.33% | Rank-based payout scale among homebuilder peers | 2024–2026 in-flight |
| Relative ROE | 33.33% | Rank-based | 2024–2026 in-flight | |
| Relative Operating Margin | 33.33% | Rank-based | 2024–2026 in-flight |
Compensation Structure Analysis
- Increased performance leverage in LTI: PSUs raised from 50% to 60% of LTI starting 2024, shifting mix toward at-risk, relative metrics across all components (TSR/ROE/Op Margin) .
- Replaced volatile growth pool with APTI profit participation plus relative modifier to normalize macro effects and align to peer outperformance; delivered sizable cash payouts on strong 2024 results .
- Governance tightening: 2024 amendments removed pro rata vesting for performance awards under ordinary severance and codified CIC bonus calculation; dual clawbacks in place .
Say‑on‑Pay & Peer Benchmarking
- Say‑on‑Pay support: ~92% approval in 2024; 5-year average ~92% .
- Executive compensation peer group (also used for relative performance): D.R. Horton; NVR; KB Home; Taylor Morrison; Lennar; Toll Brothers; Meritage Homes; Tri Pointe Homes; M/I Homes .
Expertise & Qualifications
- Education: BS and JD, University of Southern California .
- Experience: Almost 30 years across PHM operating leadership, CEO of Shapell, and founder/operator of Koart Residential, spanning homebuilding operations and land pipelines .
Investment Implications
- Pay-performance alignment and retention: High variable pay (strong 2024 cash payouts) and increased PSU mix heighten performance linkage; service-based RSUs with 2026–2027 cliffs create identifiable vest windows that may add periodic selling/liquidity pressure when RSUs vest (e.g., 14,318 units on May 18, 2026; 9,905 units on Jan 31, 2027) .
- Ownership alignment: Beneficial ownership (34,143 shares) plus meaningful unvested RSUs/PSUs and a 3× salary guideline (within 5-year window for compliance) support alignment; hedging/pledging prohibitions reduce misalignment risk .
- Contractual economics: Severance multiple at 18 months (<5 years’ service) and CIC cash construct are moderate by large-cap standards; removal of pro rata vesting for performance awards under ordinary severance raises performance discipline; dual clawbacks mitigate conduct and restatement risk .
- Governance/related-party risk: Board-managed wind-down of legacy real estate interests and disclosed escrow payment (~$175k) with safeguards; disclosures suggest residual risk declining as properties exit .
- Company execution backdrop: Record 2024 results and above-max annual incentive performance underpin near-term incentive realizations; relative LTI metrics should remain supportive if PHM sustains peer outperformance on TSR/ROE/Operating Margin .
Block references:
- Record 2024 operating metrics and capital returns ; 5-year TSR .
- Annual Program mechanics/results and Koart’s Annual Program payout .
- Pre-Tax Income PPP mechanics and Koart payout .
- LTI program designs and grants .
- Ownership/vesting data .
- Severance/CIC and clawback details .
- Related-party mitigation .