Aligning compensation with corporate and ownership objectives

Private real estate businesses—especially family-owned ones—are evolving in how they attract and retain key talent. Where equity participation once seemed unthinkable, these companies are now embracing performance-based compensation plans to stay competitive and support long-term growth. This shift reflects the growing need to align employee incentives with ownership and corporate strategy. While short-term bonuses still play a role, long-term incentive plans (LTIPs) tied to value creation are becoming more common, especially for senior leadership.

In this Espace magazine article, Alana Geller and Zachary Brzezinski explore how to design or refine incentive plans, focusing on essential aspects like participant eligibility, performance measurement, vesting timelines, valuation, and payout structures. It also addresses complex considerations like taxation, liquidity, and related-party transactions—factors particularly relevant to private enterprises. A well-structured incentive plan not only enhances engagement but also strengthens management continuity and succession planning. For business families preparing for generational transition, these tools can play a crucial role in preserving both legacy and performance. With the right approach, incentive plans become more than just compensation—they become a strategic asset.