UDR, Inc.
For the period ended Mar 27, 2025. Filed Mar 27, 2025.
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Mar 27, 2025 · Filed Mar 27, 2025
Contents
Proxy Overview
PROXY OVERVIEW
This summary highlights selected information about UDR**and the items to be voted on at the annual meeting. This summary does not contain all of the information that you should consider in deciding how to vote. You should read the entire proxy statement carefully before voting.
Company Overview
About UDR, Inc.
UDR is a $22 billion enterprise value multifamily REIT that owns, operates, develops and redevelops a diversified portfolio of apartment homes across targeted U.S. markets. Founded in 1972, UDR is an S&P 500 company that consistently generates strong total shareholder return through innovation, best-in-class operations and disciplined capital allocation across a wide range of opportunities. UDR’s strategy is founded on diversification across markets, price points, and product types which coupled with our best-in-class operations delivers a full-cycle investment that generates both growth and stability. As of December 31, 2024, we owned 187 communities including 60,120 homes (and an interest in an additional 7,633 homes held by entities in our debt and preferred equity program) and had 1,419 full-time and 13 part-time associates who worked to generate in excess of $1.65 billion of revenue in 2024.
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UDR’s Business Strategy
Why UDR?
Strategy
Our primary goal is to consistently generate above-peer* average total shareholder return (“TSR”) while considering our stakeholders and the environments in which we operate. The following attributes aid us in executing this goal through growth in Funds from Operations as Adjusted (“FFOA”), Net Asset Value (“NAV”), and the Dividend per share combined with being a strong Corporate Citizen.
*Throughout when we refer to our apartment peers or peers, unless otherwise indicated, we are referring to AvalonBay Communities Inc. (AVB), Camden Property Trust (CPT), Equity Residential (EQR), Essex Property Trust, Inc. (ESS), Independence Realty Trust (IRT), and Mid-America Apartment Communities, Inc. (MAA).
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| ► Operating Excellence | | ► Culture and ESG |
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| ●Generate above-peer median same-store growth.●Enhance controllable operating margin via innovative technological solutions.●Increase resident satisfaction through self-service enablement. | | ●Promote an innovative, inclusive culture where associate engagement is high, growth and development is more than a catch phrase, and elevating the customer experience is a central focus.●Reduce our environmental footprint through accretive capital investments in energy, water, and waste initiatives. |
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| ► Portfolio Diversification | | ► Accretive Capital Allocation |
| ●Reduce metropolitan statistical area concentration risk and same-store growth volatility and appeal to a wide renter/investor audience.●Implement our best-in-class operating and capital allocation platforms. | | ●Invest in and pivot to the best risk-adjusted return opportunities.●Apply predictive analytics that influence investments and capital deployment. |
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| ► Balance Sheet Strength | | |
| ●Maintain a safe, liquid and flexible balance sheet that can fully fund our needs throughout real estate cycles.●Sustain a diverse, efficient set of capital sources. | ||
These efforts contribute to creating above-peer average TSR:
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2024 Performance Highlights
In 2024, UDR achieved a variety of successes, which include:
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| ► Earnings and Growth Highlights | ||
| ●Generated total shareholder return of 18.3% which outperformed the NAREIT Equity REIT Index by 960 basis points.●Grew the Company through completing two developments with a total of 415 apartment homes.●Our dividend paid in January 2025 (for the fourth quarter of 2024) was our 209th consecutive dividend paid and our annualized dividend for 2025 increased by 1.2% over 2024. | ||
| ► Operational Highlights | ||
| ●Continued the implementation and enhancement of the Company’s Next Generation Operating Platform to improve the customer experience and our operating efficiency through a self-service model. Since 2018, UDR’s efforts have resulted in the best controllable operating margin in the multifamily peer group at approximately 200 basis points above what would be expected for a company with UDR’s average rent. We are continuing our innovation efforts and have identified future projects which we estimate will increase net operating income by as much as $70 million over time while at the same time enhancing our residents’ experience.●23 consecutive months (through February 2025) of reduced resident turnover.●The most improvement amongst our apartment peers in year-over-year resident turnover since the beginning of 2023. | ||
| ► ESG Highlights | | |
| ●Named the 2024 Top Workplaces winner in the Real Estate industry.●In early 2025, recognized as a USA Today Top Workplace.●Selected by the U.S. Green Building Council as a LEED Homes Award recipient in the Outstanding Developer category.●Reduced Scope 1 and 2 emissions intensity by 20% between 2020 and 2023, which is halfway towards the Company’s emissions reduction target of 40% by 2035. ●Procured 30% of operationally controlled electricity through renewable energy sources in 2023 (2024 results will not be finalized until later in 2025).●Achieved 84% participation by our associates in our quarterly Associate Engagement Pulse Survey.●Conducted quarterly pulse surveys to promptly examine and consider the needs and perceptions of our associates and leveraged their feedback to make modifications to our benefits programs including by decreasing the time required to be eligible following hire.●Associate turnover of 20% in 2024 outperforming the industry average of 33%. ●Increased the number of Electric Vehicle (“EV”) charging ports in our portfolio by more than 50% when compared to 2023, with more than 630 EV charging ports installed as of the end of 2024. | ||
| ► Investment and Balance Sheet | | |
| ●Invested in $55 million of joint venture and operating partnership unit transactions.●Maintained our investment-grade balance sheet and have the lowest cost of debt in our sector and the best liquidity profile, with only 10% of debt maturing through 2026.●Expanded our redevelopment pipeline to include approximately $75 million of current projects and identified approximately $100 million of future opportunities.●Reinvested approximately $255 million into our portfolio including in areas such as redevelopment, NOI enhancing projects, and sustainability related projects. | ||
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Innovation Accomplishments
UDR’s history of innovation has delivered better SS NOI growth and controllable operating margin versus peers.
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| Controllable Operating Margin (“COM”) ExpansionCOM vs. Avg. Monthly Rent(1) (TTM THROUGH 4Q 2024) | |
| Approximately 200 bps COM advantage Equates to approximately $30M in higher annualized NOI. | |
| (1) | Based on disclosures across the peer group, Average Monthly Rent is defined as average monthly rental rates for EQR, ESS, IRT, and MAA and is defined as average monthly revenue per occupied home for AVB, CPT, and UDR. |
Source: Company and peer documents.
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| Approximately 200 bps controllable operating margin advantage vs. peer average | Same-Store EBITDA margin (including G&A and property management) is ~110 bps higher than the peer average | Higher Same-Store EBITDA margin in 9 of 14 primary UDR markets in which we compete with our apartment peers |
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Human Capital Management
Our associates are critical to our success and, in recognition of that fact, below we describe some of the tools and initiatives we utilize to attract, develop, engage, motivate, and retain our associates as well as to measure the results of our efforts.
Board Oversight
In addition to selecting and monitoring the performance of the CEO, the board is also responsible for holding the CEO and other C-level executives accountable for Company performance on talent management, setting and cultivating a corporate culture that meets the board’s expectations and aligns with the Company’s strategy, assessing quality of the executive talent pipeline, and providing oversight on talent and compensation strategies. Our Human Resources team presents to our board several times a year, providing a thorough overview of our human capital initiatives, encompassing the evaluation process and results, workforce analysis, and strategic planning components.
Helping Our Associates Thrive
The workforce at UDR remains highly engaged, with trust in management and a positive outlook for the future. The Company continued to invest in initiatives that strengthen workforce engagement and equity, resulting in industry-leading low turnover rates, as well as placing a greater focus on preparing the workforce to support the current and future needs of the business.
Key accomplishments in 2024 included the introduction of a new People Philosophy and added behaviors to align with our values, sustained high engagement scores, and recognition as a Top Workplace in the Real Estate Industry. Our talent strategy focused on identifying and nurturing future leaders through assessments and targeted programs, as well as creating business continuity through succession planning, senior leader development, and coaching.
Prior to establishing our 2025 goals, we leveraged external research and data to identify external trends and insights, providing a broader perspective to drive informed decision-making. This allowed us to build a strategy that proactively responds to changes in the labor market and drives strategic alignment to the most pressing workforce trends affecting organizations today. For 2025, our five core objectives are as follows: (1) optimize HR structure for greater efficiency and execution; (2) improve HR processes and systems to improve resource allocation and accelerate delivery of HR solutions; (3) elevate the employee experience by bringing UDR's People Philosophy to life; (4) provide forward-thinking leadership and tailored support to the business; (5) develop increased manager effectiveness through greater tools, training, and data.
Associate Compensation
Compensation programs are also important to recruiting, attracting and retaining talent, and along with our engagement surveys, we leverage industry and general market compensation survey data to guide the design of our base pay and incentive programs. By doing this, we ensure our alignment to the relative labor markets is relevant, fair, and competitive.
In 2018, a “Health of the Workforce” performance metric was added to our short-term incentive compensation program for our named executive officers and certain senior officers, which has been retained for subsequent years. In 2024, we expanded our “Health of the Workforce” and ESG metrics so that they impact associate compensation for many associates at the director level and above.
Associate Growth & Development
We firmly believe that ongoing development is essential for associate job satisfaction, effectiveness, career progression, and retention. New associates participate in a comprehensive two-day onboarding process that covers our culture, values, mission, and administrative procedures. In 2024, we piloted a new onboarding roadmap to support onboarding new operations associates and decrease time to productivity. In addition, we offer a wide range of training opportunities tailored to individual needs.
Throughout 2024, the Talent Development team assessed the current training curriculum, audited the quality of existing content, and began documenting opportunities for improvement. As we look to the future, our long-term strategy will focus on UDR-developed content that supports the enhancement of skills and competencies at all levels and emphasizes personalized learning paths, ongoing development opportunities, and career progression.
During 2024, we introduced two digital customer experience service training courses and subsequent leader guides to approximately 1,200 associates to improve overall customer service skills and increase resident satisfaction and loyalty. In addition, in 2024 more than 450 UDR associates completed a DiSC assessment, which is a personality tool that measures preferences and tendencies, not skill or ability. Finally, in 2024, more than 400 leaders across the Company have participated in in-person experiential training, leveraging hands-on learning activities to improve team effectiveness, trust, communication, and collaboration.
In total, over 6,000 training courses are available to our associates, spanning topics such as leasing skills, property maintenance, customer service, project management, and leadership development. In 2024, our associates collectively invested 38,225 hours in training, averaging 27 hours per full time associate. By the end of 2024, 90% of associates had completed annual IT security training, fair housing, harassment, workplace violence, diversity and inclusion, and business ethics training.
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Associate Engagement
Our associate engagement remains well above industry average at 77%. We leverage our quarterly pulse surveys to track our associates’ needs and had an 84% participation rate in our surveys. Analysis of the surveys revealed a strong foundation of collaboration, support, and responsiveness across corporate departments, alongside a general appreciation of UDR’s benefits offerings. Additional engagement highlights included: 95% of associates understand how their role impacts the overall customer experience; 85% feel empowered to make decisions to best serve the customer; and 85% feel their work provides a sense of personal accomplishment.
Associate Health & Well-being
In 2024, we upgraded our Employee Assistance Program (EAP) and increased enrollment by 10%. Our EAP includes counseling services, educational resources and tools, including workshops and seminars on stress management, nutrition, and well-being for associates, partners, and teen-aged dependents. We also invested in virtual and in-person wellness fairs aimed at providing associates with learning opportunities on topics ranging from stress management and mental health to financial fitness. We continue to leverage our Lifestyle Spending Account, which provides associates with $1,000 annually to spend as they choose bolstering associate satisfaction.
Our commitment to associate benefits is underscored by a third-party benefits survey, conducted in 2024, where 84% of respondents stated they understood their benefits and 64% believed that UDR offered a benefit package that is satisfactory relative to other companies in the industry.
Diversity, Inclusion, & Community Engagement
We prioritize respect, fairness, and the promotion of diverse perspectives, which contribute to our Company's growth and success. Our commitment extends to fostering a diverse and inclusive workplace environment that facilitates the development and advancement of all associates. We strive to create a healthy and diverse work environment and attract candidates from all backgrounds, ethnicities, and genders. These efforts have been successful. In 2024, 70% of our newly hired associates were from ethnic groups other than white, and 38% were female.
We also believe that our associates should be active in their communities, and we support their efforts. In 2024, we introduced an enhanced volunteer policy that continues to provide associates with up to eight paid hours annually for volunteer activities. Previously, volunteer opportunities were limited to one or two company-sponsored events per year with designated organizations. The updated policy now allows associates the flexibility to volunteer at any time throughout the year with a charitable organization of their choice. Through the policy, UDR provided 1,050 hours of paid time off to associates for volunteer work with over 30 local organizations. We also organized food, clothing, and blood drives, as well as initiatives to promote non-profit organizations and causes, fostering a culture of giving back.
Set forth below are graphs that show the average salary by gender and ethnicity versus the average salary company wide, in each case by job title:
| by gender: | |||||||
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| Salaries compared to average salary by job title · Workforce Gender · Management Gender · Management Promotions Gender (2021-2024) | |||||||
| 102% | 103% | 39% | 61% | 41% | 59% | 45% | 55% |
| Female | Male | Female | Male | Female | Male | Female | Male |
| by ethnicity: | |||||||
| SALARIES BY ETHNIC GROUP TO AVERAGE SALARY BY JOB TITLE | Workforce ethnicity | Management ethnicity | Management Promotions ethnicity (2014-2024) | ||||
| Asian | 106% | Asian | 3% | Non-white | 40% | Asian | 2% |
| Black | 103% | Black | 13% | White | 60% | Black | 7% |
| White | 101% | White | 51% | | | White | 70% |
| Hispanic/Latino | 101% | Hispanic/Latino | 27% | | | Hispanic/Latino | 16% |
| Other | 98% | Other | 6% | | | Other | 5% |
| * | Data as of or for the period ending December 31, 2024. |
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| ** | Management is defined as Resident Services Manager and more senior job classifications. |
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Other includes: American Indian, Alaska Native, Native Hawaiian, Pacific Islander, Not Specified or two or more races.
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While we believe the metrics with respect to our workplace and workforce set forth above are more useful to us in managing our business, the data from our EEO-1 report for 2023, filed in May 2024 (the most recent report available), is below.
| Job Categories · Hispanic or Latino · Non-Hispanic or Latino · Overall Total | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Male | Female | ||||||||||||||
| Male · Female · White · Black or AfricanAmerican · Native Hawaiian orPacific Islander · Asian · American Indian or Alaska Native · Two or More Races · White · Black or AfricanAmerican · Native Hawaiian orPacific Islander · Asian · American Indian or Alaska Native · Two or More Races | |||||||||||||||
| Exec/Sr. Officials & Mgr | 3 | 1 | 35 | 0 | 0 | 0 | 0 | 0 | 13 | 0 | 0 | 0 | 0 | 0 | 52 |
| First/Mid Officials & Mgrs | 42 | 14 | 84 | 18 | 0 | 5 | 1 | 5 | 116 | 12 | 1 | 10 | 0 | 5 | 313 |
| Professionals | 15 | 23 | 95 | 13 | 0 | 2 | 0 | 6 | 75 | 14 | 2 | 4 | 1 | 6 | 256 |
| Technicians | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Sales Workers | 5 | 5 | 12 | 3 | 0 | 0 | 0 | 1 | 19 | 3 | 0 | 0 | 2 | 1 | 51 |
| Administrative Support | 16 | 42 | 39 | 15 | 0 | 6 | 0 | 1 | 95 | 31 | 1 | 5 | 0 | 18 | 269 |
| Craft Workers | 165 | 7 | 86 | 51 | 1 | 2 | 1 | 5 | 1 | 1 | 0 | 0 | 0 | 0 | 320 |
| Operatives | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Laborers & Helpers | 15 | 0 | 23 | 4 | 0 | 0 | 0 | 2 | 0 | 0 | 0 | 0 | 0 | 0 | 44 |
| Service Workers | 15 | 3 | 33 | 9 | 1 | 0 | 0 | 2 | 10 | 1 | 0 | 2 | 0 | 3 | 79 |
| Total | 276 | 95 | 407 | 113 | 2 | 15 | 2 | 22 | 329 | 62 | 4 | 21 | 3 | 33 | 1384 |
| Previous Year Total | 276 | 95 | 400 | 93 | 4 | 14 | 2 | 20 | 317 | 65 | 3 | 20 | 2 | 28 | 1314 |
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Sustainability
HIGHLIGHTS OF OUR SUSTAINABILITY EFFORTS OVER RECENT YEARS INCLUDE:
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| | OVER 965,000 kWh of Renewable EnergyProduced over 965,000 kWh of renewable energy through onsite solar in 2024, reducing our reliance on the electric grid in California, Washington, D.C., and Seattle. | | SCOPE 1, 2, AND 3 EMISSIONS INTENSITY REDUCTION GOALS Our emissions reduction goals align with science-based targets and include Scope 1 + 2 combined emissions intensity reduction of 40% and Scope 3 emissions intensity reduction of 30% between 2020 and 2035. | | ESG and Climate Tech FundsCommitted to invest $35M into strategic ESG and Climate Technology Funds. | |
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| | Over 320 Sustainability ProjectsOver the last ten years, we completed over 320 sustainability projects, including 260 energy conservation projects, to promote more efficient water and energy consumption and more sustainable waste management. | | United Nations Sustainable Development GoalsOur ESG goals align with the 10 United Nations Sustainable Development Goals that we believe are the most relevant to our industry and stakeholders. | | OVER 34 MILLION kWh in RECsIn 2024 we retired Green-e certified renewable energy credits (“RECs”) representing over 34 million kWh of energy usage. Cumulatively since 2019, we have retired RECs representing over 146 million kWh. | |
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| | More than 630 Electric Vehicle Charging PortsWe now have more than 630 Electric Vehicle (“EV”) charging ports across our portfolio as of the end of 2024, which represents a greater than 50% increase when compared to 2023. | | PaperlessUtilizing our resident app and on-line transactions, 97% of leasing, 91% of payments, 99% of service requests, and 83% of renewals were completed on-line in 2024. | | 13,985 kWThrough demand response program participation we reduced our electricity demand during high use periods by 13,985 kW over the past six years. | |
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| | Physical Climate Change RiskAnnually, using third-party assessments, we assess all UDR assets and markets to better understand risks relating to climate change over seven risk factors that represent longer-term and event driven risk. Results are provided to the board for review. | | 10,488,000 Gallons ReclaimedIn 2024, we used 10,488,000 gallons of reclaimed water for irrigation purposes reducing our use of potable water. | | ASSET LEVEL CLIMATE RISK AND OPPORTUNITYWe perform an annual asset ranking of climate-related risks and opportunities including physical, transition, and regulatory factors to identify the best candidates for sustainability related capital projects. | |
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| | NEARLY 50K Metric Tons CO2e AvoidedCumulative avoided CO2e emissions have totaled nearly 50k metric tons since 2015. | | Resident CommunicationWe promoted sustainable practices with our residents by sending over 83,700 environmental communications (consisting of materials regarding methods to save energy, demand response opportunities, etc.) in 2024. | | ||
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| | Sustainable Building CertificationAs of 12/31/24, UDR owned 38 communities that have obtained sustainable certifications, representing 20% of the portfolio. | | Compensation Tied to ESGIn 2024 our short-term incentive compensation metrics for UDR’s senior executive team (including most directors and higher job titles) continued to include sustainability and health of the workforce specific criteria to ensure accountability for these important initiatives. | | ||
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Commitment to Corporate Responsibility Reporting
In 2024, we published our sixth ESG Report covering calendar year 2023, which is available on the investor relations page of our website under the heading ESGà 2024 ESG Report. Our Report aligns with SASB and TCFD standards as well as GRI Universal Standards (2021). A sample of the Company’s ESG achievements presented within the report include:
| ● | Reduced Scope 1 and 2 emissions intensity by 20% since 2020, which is halfway towards the Company’s emissions reduction target of 40% by 2035 and procured 30% of operationally controlled electricity through renewable energy sources in 2023. |
| ● | Completed Sustainability Certification of seven additional apartment communities, increasing the Company’s sustainability certified property count to 36 (representing nearly 20% of the Company’s portfolio). |
| ● | Augmented senior leadership’s Short-Term Incentive Program compensation targets to better align with important ESG priorities. |
We will continue to evaluate our ESG strategy through consistent reviews of our ESG processes and initiatives to ensure that they (1) remain aligned with and enhance our strategic and sustainability goals, (2) address the evolving needs and expectations of our stakeholders, and (3) continue to provide useful and actionable ESG data metrics. Continued ESG improvement is critical to our long-term success, the results and the total shareholder return we generate over time, enhancing our culture, and improving our residents’ experience.
Awards and Leadership
UDR’s ongoing commitment to enhancing its comprehensive ESG program resulted in the Company earning a variety of honors from widely recognized institutions as a leader in ESG and sustainability in 2024.
| | | 2024 National Top WorkplacesCertified in 2024 and Named winner in the Real Estate Industry.GRESB Real Estate SurveyTop 3rd of Global, Listed, Residential.2024 LEED Homes AwardsNamed Outstanding Developer/Builder of the Year. | | SDG AlignmentAligned with 10 United Nations Sustainable Development Goals.2025 Top WorkplaceNamed a 2025 USA Today Top Workplace.Green BondsTwo Green Bond issuances totaling $650 million of proceeds since 2019. | | Sustainable Building Certifications UDR owns 38 communities that have obtained sustainability certification, representing 20% of the portfolio as of 12/31/24.Climate Tech FundsCommitted to invest $35M into strategic ESG and Climate Technology Funds. | | |
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Protecting the Environment and Our Stakeholders
We understand the impact our business can have on the environment and our stakeholders. When appropriate, we undertake initiatives designed to improve our operational quality, improve quality of life for and retention of our associates and residents, and reduce our environmental footprint. Examples of efforts completed over the past couple of years include having third parties assess climate-change risks for each of our assets (the results of which are reported to the board and are used to inform future decision making), conducting environmental assessments of each UDR asset that we acquire, investing in ESG and Climate Technology Funds that are on the cutting edge of sustainability technology, including “green lease” addendums in all our leases to better educate our residents on their environmental impact, improving our employee benefits packages based on extensive internal feedback, and enhancing our resident experience through self-service and leading technologies. Over the past ten years we have completed over 260 energy conservation projects which have resulted in estimated avoided emissions of nearly 50k metric tons of carbon dioxide equivalent (CO2e) and have also provided a strong financial return. In 2023, we updated our Sustainability Strategy to (1) reinforce our long-standing commitment to being a sustainability leader in the REIT space, and (2) better address the evolution that the sustainability space has undergone over the past 5+ years by layering on more programmatic sustainability actions and capital investment to our already best-in-class compliance and reporting framework. This updated strategy is governed by our Environmental Policy, which states that UDR is committed to incorporating efforts towards the protection of the environment within the Company’s environmental governance, risk management, and business strategy in order to operate more sustainably and create long-term value for our stakeholders.
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proposal 1 highlights
| 01 | Election of 9 Directors |
| The Board recommends a vote “FOR” each director nominee | |
| ●Diverse slate of directors (44% of our directors to be voted on are diverse) with broad leadership experience.●All candidates are highly successful executives with relevant skills and expertise.●Average director tenure of 13.3 years with 8 of 9 directors to be voted upon independent of management.●Board ranked number 1 in the 2024 Extel All-America Executive Team Rankings among 30 large capitalization (market capitalization of $10 billion to $50 billion) REIT companies.●Mr. Klingbeil elected not to stand for re-election at the annual meeting and the board has appointed him Chairman Emeritus as of the conclusion of the annual meeting. Further, following the conclusion of the annual meeting Mr. Grove will become Lead Independent Director. The metrics included regarding the composition of the board do not include Mr. Klingbeil. | |
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Our Existing Board
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| Katherine A. CattanachFormer General Partner of INVESCO Private Capital, Inc. | Jon A. GroveFormer Chairman, President and Chief Executive Officer of ASR Investments Corporation | Mary Ann KingCo-Head of Berkadia Institutional Solutions | ||||
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| IndependentTenure: 19 yearsOther Current Public Company Boards: 0Committee(s): AC, NGC (Chair) | | IndependentTenure: 27 yearsOther Current Public Company Boards: 0Committee(s): CC | | IndependentTenure: 10 yearsOther Current Public Company Boards: 0Committee(s): CC, NGC | ||
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| James D. KlingbeilChairman and CEO of Klingbeil Capital Management and The Klingbeil Company | Clint D. McDonnoughManaging Partner of McDonnough Consulting LLC; Former Office Managing Partner for Ernst & Young LLP’s Dallas office | Robert A. McNamaraFormer Group Chief Risk Officer of Lend Lease Corporation | ||||
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| Lead Independent DirectorTenure: 27 yearsOther Current Public Company Boards: 0Committee(s): EC (Chair) | | IndependentTenure: 9 yearsOther Current Public Company Boards: 0Committee(s): AC, EC | | IndependentTenure: 11 yearsOther Current Public Company Boards: 1Committee(s): CC (Chair), NGC | ||
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| Diane M. MorefieldFormer Executive Vice President, Chief Financial Officer of CyrusOne | Kevin C. NickelberryManaging Director and Co-Head of the Elevate Strategy at GCM Grosvenor | Mark R. PattersonPresident of MRP Holdings LLC | ||||
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| IndependentTenure: 5 yearsOther Current Public Company Boards: 1Committee(s): AC (Chair), NGC | | IndependentTenure: 4 yearsOther Current Public Company Boards: 0Committee(s): AC, NGC | | IndependentTenure: 11 yearsOther Current Public Company Boards: 3Committee(s): CC | ||
| AC = Audit and Risk Management CommitteeCC = Compensation and Management Development CommitteeNGC = Nominating and Governance CommitteeEC = Executive Committee | | | | | | |
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| Thomas W. ToomeyChairman and CEO of UDR, Inc. | | |||||
| | Tenure: 24 yearsOther Current Public Company Boards: 0Committee(s): EC | | | |||
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Board Snapshot
Skills and Attributes
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| Accounting/Financial Literacy | | C-Level Management Experience | | Capital Market Experience | | Corporate Governance |
| 9/9 | | 7/9 | | 8/9 | | 9/9 |
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| Multifamily Experience | | Non-UDR Board Experience | | Property Mangement and Operations | | Public Company CEO Experience |
| 3/9 | | 6/9 | | 4/9 | | 2/9 |
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| Real Estate Industry Experience | | Sales and Marketing Experience | | Stakeholder Advocacy | | Strategic Oversight | | Technology, Cybersecurity, and Innovation |
| 8/9 | | 7/9 | | 9/9 | | 9/9 | | 6/9 |
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Shareholder Engagement
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| 77% | In 2024 and early 2025, we had 707 interactions with our investors through meetings and property tours, representing ownership of approximately 77% of our outstanding common stock. | 51% | In addition, we proactively contacted the governance or stewardship departments of approximately 120 of our investors and received responses from and had engagement meetings with representatives of 17 of such departments, representing ownership of approximately 51% of our outstanding common stock. |
Governance Highlights
UDR has a history of strong corporate governance guided by three primary principles – dialogue, transparency and responsiveness. The board has adjusted our governance approach over time to align with evolving best practices, drive sustained shareholder value, and serve the interests of shareholders.
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| ► Good Governance | |
| ●Extensive board and committee dialogue with formal processes for shareholder engagement ●Annual board and committee self-evaluations●Annual individual director evaluation process●Periodic continuing education for directors●All directors attended at least 75% of meetings held●Policies, incorporated in our Statement on Corporate Governance and Nominating and Governance Committee Charter, requiring the initial pools of candidates for the board and external searches for a Chief Executive Officer to include diverse candidates. This concept has been expanded to cover associates at all levels●Annual advisory approval of named executive officer compensation●Robust Code of Business Conduct and Ethics, and Code of Ethics for Senior Financial Officers●Stock ownership guidelines for executive officers and directors●Board Overboarding Policy | ●Prohibition on hedging transactions●Pledging transactions prohibited without prior approval●Recoupment Policy ●Charitable Donations and Political Contributions Policy ●Annual ESG reporting●Double-trigger acceleration of vesting in the event of a change in control●Twelve-month minimum vesting on equity awards generally●Board and committee oversight of material short-term and long-term risks (including climate change and cybersecurity risk), ESG and human capital management |
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| ► Shareholder Rights | |
| ●Annual election of all directors●Majority voting in uncontested director elections●Proxy access for eligible director candidates nominated by eligible shareholders●No shareholder rights plan (poison pill)●Confidential voting | ●No material restrictions on shareholders’ right to call a special meeting ●Active shareholder engagement●Ability for shareholders to propose binding bylaw amendments●No issued and outstanding shares of capital stock that have no voting rights and no treasury stock |
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| ► Independent Oversight | |
| ●Strong Lead Independent Director role with clearly articulated responsibilities●Audit, Compensation, and Nominating and Governance Committees consist entirely of Independent Directors | ●All directors are independent, except the Chairman and Chief Executive Officer●Independent directors and committees meet regularly in executive session |
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Proposal 2 highlights
| 02 | Say-on-Pay: Advisory Vote on the Compensation of the Named Executive Officers |
| The board recommends a vote “FOR” this proposal | |
| ●Independent oversight by our Compensation and Management Development Committee, with the assistance of an independent compensation consultant.●Executive compensation that is competitive with our peers and that is structured to be aligned with our strategy and is measured against both absolute and relative to our peers total return to shareholders and FFOA per share growth.●Executive compensation comprised of a mix of base salary, short-term incentive compensation and long-term incentive compensation, and is determined based on the consideration of a number of factors described in more detail in “Executive Compensation — Compensation Discussion and Analysis.”●Our TSR over time compares favorably to the peer group.●Neither our long-term nor short-term incentive compensation programs include time based awards. | |
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Components of 2024 Compensation
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| component | Fixed/Variable | objective | | performance metrics |
| Base Salary | Fixed | Designed to reward individual effort associated with job-related duties and to attract and retain talented executive officers for our Company. | | |
| Short-Term Incentive Compensation (STI) | Variable | Designed to encourage outstanding individual and Company performance by motivating the named executive officers to achieve short-term Company and individual goals by rewarding performance measured against key annual strategic objectives and, for the CEO, using the independent directors’ evaluation of the CEO’s performance towards achieving short-term goals. | | ●FFO as Adjusted per share●Transactions Index●Operations Index●GRESB Percentile ●Associate Engagement & DEI●Individual and Department Goals |
| Long-Term Incentive Compensation (LTI) | Variable | Our LTI compensation is designed to closely align the interests of our management with the creation of shareholder value, to motivate our management to achieve long-term growth and success of our Company and to foster significant ownership of our common stock by our management.LTI compensation is the most significant component of the named executive officers’ compensation. | | ●3-Year Relative TSR vs. Apartment Peers●3-Year Relative TSR vs. NAREIT Equity REITs Total Return Index●3-Year Relative FFO as Adjusted Growth Rate vs. Apartment Peers●1-Year FFO as Adjusted per share (vests over two years) |
Say-on-Pay/Shareholder Engagement
While we have consistently had strong shareholder support for our executive compensation program, we continue to engage in dialogue with shareholders on executive compensation issues. We will consider the outcome of future advisory votes and the input we receive from shareholder engagement when establishing the Company’s compensation programs and policies and making compensation decisions regarding our named executive officers.
Specifically, in advance of our 2024 meeting and following the filing of our proxy statement with respect to the meeting, the largest proxy advisory service recommended an against vote with respect to our say-on-pay proposal. In response we filed supplemental material and conducted outreach specific to the recommendation to over 100 of our largest shareholders. Among our largest 25 shareholders, only five, representing approximately 9% of shares outstanding, voted against our say-on-pay proposal.
Our shareholders have consistently supported our executive compensation program and over the last five years, shareholder support for our advisory vote on executive compensation has averaged 83.55%.
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Compensation Earned
Total compensation, as reported in the Summary Compensation Table and calculated as required by applicable rules and regulations, includes items driven by accounting rules and assumptions with respect to incentive compensation that has not yet been earned and may in the future not be earned. Therefore, it is not reflective of the compensation our named executive officers actually earned in a given year. Accordingly, to supplement the disclosure contained in the Summary Compensation Table and the narrative disclosure accompanying the table starting on page 97, we are providing the table below to compare the compensation earned by our named executive officers in 2024, 2023, and 2022 to the total compensation shown by the Summary Compensation Table.
The amounts set forth below for “Earned Compensation” differ from the amounts reported as total compensation in the Summary Compensation Table and are not a substitute for those amounts.
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| | | | | Total | | Earned |
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| Name and | | | | Compensation Table) | | Total |
| Principal Position | | Year | | ($) | | ($) |
| Thomas W. | 2024 | | 10,178,473 | | 10,371,190 | |
| Toomey | 2023 | | 11,755,015 | | 6,727,096 | |
| Chief Executive Officer | 2022 | | 8,149,435 | | 9,852,300 | |
| Joseph D. Fisher | 2024 | | 4,306,246 | | 4,835,218 | |
| President, Chief Financial Officer | 2023 | | 4,855,745 | | 3,701,277 | |
| and Chief Investment Officer | 2022 | | 8,191,454 | | 4,288,540 | |
| Harry G. Alcock | 2024 | | 5,071,947 | | 4,006,769 | |
| Former Senior Vice | 2023 | | 3,601,319 | | 2,916,140 | |
| President - Chief Investment Officer | | 2022 | | 3,236,130 | | 4,332,375 |
| Michael D. Lacy | | 2024 | | 2,812,525 | | 3,081,200 |
| Senior Vice | 2023 | | 2,765,854 | | 2,478,862 | |
| President - Chief Operating Officer | 2022 | | 1,815,398 | | 2,395,045 | |
Earned Compensation for 2024 includes 2024 salary, any bonus earned in 2024, short-term incentive compensation earned for 2024, the portion of the long-term incentive programs with respect to which the performance period ended on December 31, 2024, and the “All Other Compensation” from the Summary Compensation Table for 2024. For Mr. Alcock Earned Compensation for 2024 also includes the value of Class 2 LTIP Units and Class 2 Performance LTIP Units that vested in connection with his resignation and the value of the portion of the Class 2 LTIP Units granted to Mr. Alcock in connection with the consulting agreement entered into in connection with his retirement that vested in 2024.
Earned Compensation for 2023 includes 2023 salary, any bonus earned in 2023, short-term incentive compensation earned for 2023, the portion of the long-term incentive programs with respect to which the performance period ended on December 31, 2023 and the “All Other Compensation” from the Summary Compensation Table for 2023.
Earned Compensation for 2022 includes 2022 salary, any bonus earned in 2022, short-term incentive compensation earned for 2022, the portion of the long-term incentive programs with respect to which the performance period ended on December 31, 2022 and the “All Other Compensation” from the Summary Compensation Table for 2022.
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Our Compensation Best Practices
Our compensation policies and programs are built upon a strong foundation of corporate governance and compensation best practices, including:
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| WHAT WE DO | WHAT WE DON’T DO | ||
| ●Provide a significant portion of our named executive officers’ total compensation in the form of awards tied to executing our long-term strategy, performance relative to key business and individual objectives, and performance versus our peers as measured by a diverse set of metrics.●Require compliance with our Executive Stock Ownership Guidelines, which require that our executive officers own a specified number of shares of the Company’s common stock or equivalent (110,000 shares for the Chairman and Chief Executive Officer and President, 50,000 shares for any Executive Vice President, and 20,000 for any Senior Vice President) and for the Compensation Committee to impose measures to achieve the purposes of the guidelines.●Have a Recoupment Policy that applies to certain of our executive officers, including all our named executive officers, and their performance-based incentive compensation. This policy was updated in 2023 to satisfy rules adopted by the SEC and the NYSE in 2023.●Have a Compensation Committee comprised entirely of independent directors. The Compensation Committee has retained its own independent compensation advisor.●Have a Compensation Committee that reviews external market considerations, internal considerations, and the long-term interests of our shareholders, when making compensation decisions.●Have the ongoing consideration and oversight by the Compensation Committee with respect to any potential risks associated with our incentive compensation programs.●Have a “double trigger” change of control provision and no awards outstanding that are subject to the legacy “single trigger” provision. | | ●Permit any Company personnel, which includes directors, officers and all other employees of the Company, to engage in any short-term, speculative securities transactions, engage in short sales, buying or selling put or call options, trading in options (other than those granted by the Company) or engaging in hedging transactions, in each case with respect to our securities.●Permit purchasing securities on margin or pledging our securities as collateral without prior approval.●Provide tax gross-ups for our named executive officers.●Grant only time-vested restricted stock units, LTIP Units (including Performance LTIP Units), options, or other equity awards to our named executive officers as part of our incentive compensation programs other than in limited circumstances such as the appointment of a new executive officer or other special circumstance.●Time the grants of restricted stock, restricted stock units, LTIP Units, Performance LTIP Units, options or other equity awards to coordinate with the release of material non-public information, or time the release of material non-public information for the purpose of affecting the value of any named executive officer compensation.●Make one-time or special awards to our named executive officers other than in connection with the appointment of a new named executive officer or other special circumstance. | |
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Compensation Changes Made in Response to Stakeholder Feedback
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| | Minimum Vesting PeriodBeginning with grants made in 2021 and thereafter, all equity grants will have a minimum vesting period of 12 months subject to certain limited exclusions. | | Double Trigger ProvisionAll grants made in 2021 and thereafter are subject to a double-trigger change in control provision resulting in no outstanding grants having a single trigger provision. | | ||
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Proposal 3 highlights
| 03 | Independent Registered Public Accounting Firm |
| The board recommends a vote “FOR” ratification of Ernst & Young LLP for 2025. | |
| ●Independent firm with few ancillary services and reasonable fees.●Significant industry and financial reporting expertise. | |
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Ernst & Young LLP, an independent registered public accounting firm, served as our auditors for fiscal 2024. Our Audit Committee again selected Ernst & Young LLP to audit our financial statements for fiscal 2025. Although it is not required to do so, the board is submitting the Audit Committee’s selection of our independent registered public accounting firm for ratification by the shareholders at the annual meeting in order to ascertain the view of our shareholders regarding such selection. Below is summary information about Ernst & Young’s fees for services during fiscal years 2024 and 2023:
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| Description of Services · 2024 · 2023 | ||||
| Audit Fees | | $1,476,220 | | $1,341,609 |
| Audit-Related Fees | | — | | — |
| Tax Fees | | $30,000 | | $68,170 |
| All Other Fees | | — | | — |
| TOTAL | | $1,506,220 | | $1,409,779 |
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The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.