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Q: executive compensation in a closely held private company ( Answered 5 out of 5 stars,   1 Comment )
Subject: executive compensation in a closely held private company
Category: Business and Money > Small Businesses
Asked by: realty-ga
List Price: $100.00
Posted: 05 Dec 2003 13:32 PST
Expires: 04 Jan 2004 13:32 PST
Question ID: 283936
I am searching for comparative salary packages for a CEO of a closely
held real estate company with annual revenues of around $3.5 million

Request for Question Clarification by pafalafa-ga on 05 Dec 2003 15:01 PST
Hello there realty-ga,

I might be able to help you here, but I need to ask two questions first:

--When you say "compensation salary package", what sort of detail are
you after -- s single average salary number, salary + bonus info, or
some other type of info -- the more you can tell me about what you
need, and how much detail, the better I can target my research.

--the most reliable and complete sources of information would be
comparable salary packages from public companies in the same line of
business and with similar a revenue stream.  Would that be an
acceptable source of information?

Let me know what you think.  Thanks.


Clarification of Question by realty-ga on 06 Dec 2003 05:52 PST
Hi pafalafa-ga
To try to answer your questions:
I am interested in a single salary number or a salary plus bonus.
Other perks are of lesser interest. Although a search of public
companies might be more reliable, it really does not address my
question. Moreover, I doubt you could find a public company with
annual revenues of only $3.5 million.
thanks for your question 


Request for Question Clarification by pafalafa-ga on 06 Dec 2003 15:46 PST
Hello again realty-ga,

I beg to differ.  There are plenty of public, small cap, real estate
companies that operate on the same scale as the company you are asking
about.  As one example (among many) consider Heartland Partners:

"Heartland Partners, L.P. is a limited partnership engaged in the
ownership, purchasing, development, leasing, marketing, construction
and sale of real estate of the Company
designated for sale and development consisted of 10 sites comprising
approximately 518 acres in 12 states."

The company has 17 employees.  It's CEO earns $196K, and it's
President has a salary of $136K.  Their total revenue in 2002 was $6.8


There are a fair number of other companies like this, with revenues in
the range of $1-10 million.  Would you like me to summarize a range of
CEO salaries for these companies, as an answer to your question?

Clarification of Question by realty-ga on 08 Dec 2003 17:23 PST
Hi Pafalafa-ga
In answer to your question-- yes. I think if you can find several
similar companies like Heartland, that would be satisfactory. Thanks
Subject: Re: executive compensation in a closely held private company
Answered By: pafalafa-ga on 10 Dec 2003 06:36 PST
Rated:5 out of 5 stars
Hello again realty-ga,

I?m glad you decided that the information on small-cap public
companies in the real estate sector would meet your needs.  They are a
valuable source of information, since SEC reporting requirements
provide a wealth of information on their finances and corporate

I?ve listed below some additional real estate firms with revenues in
the same ballpark as we discussed earlier.  I?ve also included a brief
description of the company?s operations, and executive salaries.

Several of the firms have an unusual (to me, anyway) structure whereby
their key executives receive minimal or no salaries, but fees are paid
to a person or organization listed as an ?Advisor? -- these often
appear to be fees in lieu of salary.  Where this is the case, I?ve
provided details on the Advisor?s compensation.

I hope this is the information you need.  If anything here is unclear
-- or if you simply need additional information -- just let me know by
posting a Request for Clarification, and I?ll be happy to assist you


Interstate General Co LP 

Interstate General Company, L.P. (IGC) develops and sells residential
and commercial land and is engaged in the development of waste
recycling projects that use environmental technology.

Revenue  $4.5 million

CEO -- $487K
Pres --$457K

AMEN Properties, Inc

AMEN Properties, Inc. is engaged in the acquisition of cash-generating
assets, consisting primarily of office buildings in secondary stagnant
markets, office buildings in out-of-favor growth markets and oil and
gas royalties. Through subsidiaries, it has a commercial real estate
portfolio consisting of majority ownership in two office properties
located in Midland and Lubbock, Texas, as well as an investment
interest in an oil and gas royalty trust

Revenues:  $1.0 million in 2002 ($4.5 million in 2001)

Salary information was gleaned from the company?s annual and proxy
reports on file at the SEC:

President -- $278K
CFO       -- $123K

Innsuites Hospitality Trust 

InnSuites Hospitality Trust operates as an unincorporated Ohio real
estate investment trust (REIT). As of January 31, 2003, the Company
owned a 50.80% sole general partner interest in RRF Limited
Partnership, (the Partnership). As of January 31, 2003, the
Partnership owned 11 InnSuites hotels located in Arizona, New Mexico
and southern California.

Revenue $26.9 million

CEO -- $95K
CFO -- $129K


Arizona Land Income Corporation
Arizona Land Income Corporation is a real estate investment trust (REIT). 

Revenue  $643,000 (in 2001)

CEO -- $4K


     The  Company  has no salaried  employees.  In return for their  services as
Unaffiliated Directors of the Company,  Messrs.  Freireich and Blackwell receive
an annual fee of $10,000,  a meeting  fee of $400 for each  meeting the Board of
Directors attended, and a fee of $100 for each meeting of the Board conducted by
telephone.  Mr.  Hislop  does not  receive  compensation  for his  services as a
director of the  Company.  The Company  reimburses  all  directors  for expenses
incurred in connection with their duties as directors of the Company.

...the Company pays the Advisor a servicing fee for servicing the
Company's first mortgage loans... During  2002,  the Company paid the
Advisor a servicing fee of $17,281...The Company  has also agreed to
pay the Advisor an advisory  fee for aiding the Company in developing 
investment  policies and  analyzing and  recommending
investments  to the  Company.  The advisory fee is payable in any quarter at the
end of which the shareholders' cumulative return on capital investment as of the
end of such quarter exceeds 12.7%.  Such advisory fee, when payable,  will equal
30% of the  Company's  available  cash in excess of that  necessary  to  provide
shareholders with a cumulative return on capital  investment in excess of 12.7%.
To date, the Company has not accrued or paid an advisory fee to the Advisor.

HMG/Courtland Properties Inc.

HMG/Courtland Properties Inc. is a real estate investment trust (REIT)
engaged in the ownership and management of income-producing commercial
properties. Properties owned by the Company include a hotel, private
club and marina located in Coconut Grove, Florida; a shopping center
in Jacksonville, Florida, and undeveloped land in Houston, Texas, and
Rhode Island.

Revenue  $2.4 million

Executive compensation -- $924K

The Company has one employee who is a vice president of the Company and of HMG
Advisory Corp. (the "Advisor"). ...the Advisor is entitled to receive
a monthly fee of
$55,000. The Advisor is also entitled to annual incentive compensation equal to
the sum of 10% of net realized capital gains and extraordinary items of income
for that year and 10% of the amount, if any, by which net profits of the Company
for such fiscal year exceeded 8% per annum of the Average Net Worth of the
Company, as defined. The Advisor also is entitled to a monthly fee of 20% of the
amount of any unrefunded commitment fees received by the Company with respect to
mortgage loans and other commitments which the Company was not required to fund
and which expired within the next preceding calendar month.

Advisory Fees. For the years ended December 31, 2001 and 2000, the Company and
its subsidiaries paid the Advisor approximately $924,000 and $993,000 in fees,
respectively, of which $660,000 represented regular compensation and
approximately $264,000 and $333,000 represented incentive compensation,
respectively. The Advisor is also the manager for certain of the Company's
affiliates and received management fees of approximately $30,000 in 2001 and
2000 for such services. Furthermore, for fiscal years 2001 and 2000 the Company
paid approximately $60,000 to one of the Company's officers in his capacity as
project manager for a specific property, as described above.

Golf Trust of America Inc

Golf Trust of America Inc. (GTA) was originally formed to capitalize
upon consolidation opportunities in the ownership of upscale golf
courses throughout the United States.

Revenue  $20.4 million

CEO -- $365K
CFO -- $203K

American Spectrum Realty, Inc

American Spectrum Realty, Inc. is a full-service real estate
corporation that owns, manages and operates income-producing

Revenue  $8.5 million (2001)

CEO --  $481K
COO --  $280K
Sr VP - $222K
Sr VP - $293K

Horizon Group Properties, Inc

Horizon Group Properties, Inc. (HGPI) is a self-administered and
self-managed real estate investment trust (REIT) that was established
in connection with the merger of Horizon Group, Inc. (Horizon) with
and into Prime Retail, Inc. (the Merger). The Company's initial
portfolio consisted of 14 factory outlet centers and one power center
located in 12 states.

Revenues  $17.9 million

CEO   $292K
CFO   $213K
Sr VP of Leasing  $198K
Sr VP of Asset and Property Mgmt  $175K


Again, if anything here needs elaboration, just let me know and I?ll
be happy to help as best I can.

Best of luck in your ventures.


search strategy:
Relied on bookmarked sites -- to screen small cap real
estate stocks.  Yahoo Finance to access basic financial information on
the companies of interest.  SEC?s Edgar search system to access
company annual reports and related information.
realty-ga rated this answer:5 out of 5 stars
This  answered my question well and quickly. Thank you

Subject: Re: executive compensation in a closely held private company
From: pafalafa-ga on 16 Dec 2003 14:37 PST
Thanks, realty-ga.  Glad this worked out so well.

Have a great holiday season and new year.


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