Jeffrey F. DiModica
About Jeffrey F. DiModica
Jeffrey F. DiModica, CFA, age 57, is President of Starwood Property Trust (STWD), serving since September 2014; he was a director from STWD’s inception in 2009 until July 2014. He holds a BS/BA in Finance from Boston University and an MBA from Dartmouth’s Tuck School, and is a CFA charterholder . Pay decisions consider profitability (Net Income, Distributable Earnings), stock performance, investment activity, and capital structure, rather than fixed metrics; company pay-versus-performance disclosures show TSR outcomes and Net Income/Distributable Earnings trends used by the Compensation Committee .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Starwood Property Trust | President | 2014–present | Leads diversified real estate finance platform; previously STWD director (2009–2014) |
| Royal Bank of Scotland | MD & Head of MBS/ABS/CMBS Sales & Strategy | 2007–2014 | Led distribution of structured products to institutional clients |
| Merrill Lynch | Derivatives and MBS Sales (Institutional) | 1993–2001 | Drove client coverage and product distribution in Boston |
| Chemical Bank | Merchant & Investment Banking (CRE Department) | 1989–1991 | Early commercial real estate banking experience |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Posse Foundation | Advisory Board Member | — | Non-profit scholarships and leadership development |
| MitoAction | Founding President | — | Advocacy for patients/families affected by mitochondrial disease |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 500,000 | 600,000 | 600,000 |
| Cash Bonus ($) | 2,800,000 | 3,000,000 | 2,850,000 |
- Cash bonuses are discretion-based; the Committee did not apply fixed metrics, instead considering stock performance, profitability (Net Income and Distributable Earnings), operations, risk management, investment activity, capital structure, and M&A/dispositions .
Performance Compensation
| Grant Date | Award Type | Shares | Grant-Date Fair Value ($) | Vesting Schedule |
|---|---|---|---|---|
| Mar 7, 2024 | Restricted Stock | 31,957 | 650,005 | Ratable over 3 years: 10,652 (3/15/2025), 10,652 (3/15/2026), 10,653 (3/15/2027) |
| Mar 7, 2024 | Restricted Stock | 368,732 | 7,500,009 | Cliff vest on 3/15/2027 |
| Mar 9, 2023 | Restricted Stock | 49,445 | 935,005 | Ratable: 16,481 (3/15/2024), 16,481 (3/15/2025), 16,483 (3/15/2026) |
| Mar 17, 2022 | Restricted Stock | 40,652 | 964,265 | Ratable: 13,550 (3/15/2023), 13,550 (3/15/2024), 13,552 (3/15/2025) |
| Mar 2025 | Restricted Stock | 39,880 | ~800,000 (for 2024 performance) | — |
Key performance considerations used (no formal weightings or targets):
- Profitability: Net Income Attributable and Distributable Earnings; stock performance; investment activity; acquisitions/dispositions; capital structure/risk management. Weighting: discretionary (no fixed targets/weights) .
Stock vesting (indicator of potential selling pressure):
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Shares Vested (#) | 86,793 | 77,461 | 540,093 |
| Value Realized ($) | 2,011,861 | 1,358,666 | 11,316,270 |
Equity Ownership & Alignment
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Beneficial Ownership (shares) | 1,006,650 | 925,984 | 1,226,673 |
| Percent of Class | <1% | <1% | <1% |
| Shares Outstanding (reference) | 310,649,263 | 313,873,770 | 337,742,817 |
Unvested awards (as of 12/31/2024):
| Award Description | Unvested Shares (#) | Remaining Vesting |
|---|---|---|
| 3/7/2024 (ratable) | 31,957 | 10,652 (3/15/2025); 10,652 (3/15/2026); 10,653 (3/15/2027) |
| 3/7/2024 (cliff) | 368,732 | 3/15/2027 |
| 3/9/2023 (ratable) | 32,964 | 16,481 (3/15/2025); 16,483 (3/15/2026) |
| 3/17/2022 (ratable) | 13,552 | 3/15/2025 |
Alignment policies and flags:
- Anti-hedging policy in place .
- Insider Trading Policy adopted and filed in 2024 Form 10-K (Exhibit 19) .
- Pledging: 350,544 shares pledged to a line of credit as of Feb 28, 2023 (red flag; no pledge disclosure in 2024–2025 tables) .
Employment Terms
- No employment or severance agreements with named executive officers; cash comp is paid by STWD’s external Manager (for DiModica), not directly by STWD .
- Equity acceleration: Unvested restricted stock/RSUs vest in full upon termination without cause (and for CFO, resignation for good reason), death/disability (CFO), or Change in Control (single-trigger); unvested awards are forfeited if terminated for cause or voluntary resignation (absent good reason) .
- Change in Control definition excludes transactions involving the Manager or affiliates (Board composition changes or Manager-related securities acquisitions do not constitute CoC) .
- Clawback: Policy adopted Nov 1, 2023, compliant with SEC/NYSE rules for recovery of erroneously paid incentive compensation .
Performance & Track Record (Company-level indicators used in pay decisions)
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Total Shareholder Return ($) | 88.36 | 120.03 | 99.48 | 125.96 | 125.07 |
| Peer Group TSR ($) | 81.38 | 94.05 | 69.27 | 79.21 | 79.96 |
| Net Income ($000) | 331,689 | 447,739 | 871,475 | 339,213 | 359,933 |
| Distributable Earnings ($000) | 585,299 | 794,116 | 726,297 | 662,566 | 674,961 |
Compensation Structure Analysis
- Year-over-year cash vs equity mix: Significant 2024 equity grant ($8.15M fair value) alongside lower cash bonus YoY vs 2023 (discretionary bonus set between 50th–75th percentile vs peers) .
- Shift in vehicles: Awards are restricted stock/RSUs (no options disclosed), with multi-year vesting to promote retention .
- At-risk pay: High proportion of variable cash bonus and multi-year equity; no fixed performance metric framework but multi-factor discretionary assessment anchored to profitability and stock performance .
- Manager incentive structure: External Manager’s incentive fee is tied to Core/Distributable Earnings with an 8% hurdle; however, STWD states no portion of management fees is allocated to named executive pay, limiting direct pay-for-performance linkage via fees .
Related Party Transactions (governance risks)
- Co-investment fund for key personnel (includes DiModica) with promote economics; fund holds 10% equity in a STWD subsidiary and paid $1.1M to non-controlling interests in 2024 ($1.9M in 2023) .
- Numerous Manager/affiliate transactions (loans, securitizations, leases) authorized by independent directors; potential conflicts mitigated via Board processes but present structurally due to external management model .
Investment Implications
- Strong retention via sizable, multi-year equity grants with cliff/ratable vesting; 540K shares vested in 2024 suggests ongoing supply that could create periodic selling pressure, though actual sales require Form 4 analysis .
- Alignment is mixed: meaningful personal share ownership and anti-hedging policy, but prior share pledging (350,544 in 2023) is a governance red flag and should be monitored for continuation .
- Pay decisions are discretionary with no fixed targets, but anchored to profitability (Distributable Earnings), stock performance and strategic execution; equity acceleration on single-trigger CoC increases executive downside protection (reduced performance risk), while clawback enhances accountability .
- External management and related-party activities require heightened oversight; independent director approvals and Manager fee structures (hurdle-based incentive) partially align interests, but investors should discount for potential conflicts inherent in the model .