Paramount Group is one step closer to being sold and Albert Behler is one step closer to receiving his golden parachute, whether his shareholders want him to have it or not.
This week, Paramount’s shareholders approved the real estate investment trust’s sale to Rithm Capital, Crain’s reported. The Manhattan-based buyer submitted a $1.6 billion bid for the acquisition in September, which was $6.60 per share, 11 percent below market price.
Saray Capital, a Dubai-based investment firm with a small stake in Paramount, swooped in this month with an offer of $6.95 per share, according to a regulatory filing. But Paramount’s board recommended the Rithm offer due to “material deficiencies” in Saray’s offer, including a dearth of committed financing.
In another notable vote by shareholders, a vast majority rejected Behler’s $34 million exit package, deemed unwarranted by a proxy adviser ahead of the vote.
Unfortunately for those shareholders, the vote was not binding and Paramount revealed in a regulatory filing that Behler will likely get his golden parachute as long as a sale goes through. Behler’s compensation will include $10.7 million in cash, $19.97 million in unvested equity awards and $3.3 million in other compensation.
Behler has been the CEO of Paramount since 1991. He led Paramount through its $2.3 billion initial public offering in 2014, which was the largest IPO for a U.S. REIT at the time.
He’s been a controversial figure lately, however. This year, Paramount revealed it paid millions to Behler’s personal companies and interests. The previously undisclosed payments included $3 million to a private jet company — of which Behler had a 50 percent stake — and $900,000 for Behler’s personal accounting services.
In July, Paramount revealed it was under SEC investigation related to disclosures for related-party transactions, conflicts of interest and executive compensation.
The Real Deal also discovered Behler pushed for a no-bid security contract for 60 Wall Street, a 1.6 million-square-foot vacant office building, to Guardian Services. Behler’s ex-girlfriend worked at Guardian and the two maintained friendly relations after their romantic relationship ended.
The sale of Paramount is expected to close by the end of the second quarter. Paramount controls 13 million square feet of office space in New York and San Francisco.
— Holden Walter-Warner
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