Douglas Emmett IncDEI
Douglas Emmett Inc Stock Compensation Disclosure
Stock-Based Compensation
Stock Incentive Plan
Plan description
The Douglas Emmett, Inc. 2016 Omnibus Stock Incentive Plan, as amended, our stock incentive plan (our "2016 Plan"), permits us to make grants of incentive stock options, non-qualified stock options, stock appreciation rights, deferred stock awards, restricted stock awards, dividend equivalent rights and other stock-based awards. On May 24, 2023, our stockholders approved an amendment to the 2016 Plan to, among other things, increase the number of common shares for future awards by 19.0 million. We had an aggregate of 6.2 million shares available for grant as of December 31, 2025. Awards such as LTIP Units, deferred stock and restricted stock, which deliver the full value of the underlying shares, are counted against the Plan limits as two shares. Awards such as stock options and stock appreciation rights are counted as one share. The number of shares reserved under our 2016 Plan is also subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization. Shares of stock underlying any awards that are forfeited, canceled or otherwise terminated (other than by exercise) are added back to the shares of stock available for future issuance under the 2016 Plan. For options exercised, our policy is to issue common stock on a net settlement basis - net of the exercise price and related taxes.
Plan administration
Our 2016 Plan is administered by the compensation committee of our board of directors. The compensation committee may interpret our Plan and make all determinations necessary or desirable for the administration of our Plan. The committee has full power and authority to select the participants to whom awards will be granted, to make any combination of awards to participants, to accelerate the exercisability or vesting of any award and to determine the specific terms and conditions of each award, subject to the provisions of our Plan. All officers, employees, directors and other key personnel (including consultants and prospective employees) are eligible to participate in our 2016 Plan.
LTIP Units
We have made certain awards in the form of a separate series of units of limited partnership interests in our Operating Partnership called LTIP Units, which can be granted either as free-standing awards or in tandem with other awards under our 2016 Plan. Our LTIP Units are valued by reference to the value of our common stock at the time of grant, and are subject to such conditions and restrictions as the compensation committee may determine, including continued employment or service, and/or achievement of pre-established performance goals, financial metrics and other objectives. Once vested, LTIP Units can generally be converted to OP Units on a one for one basis, provided our stock price increases by more than a specified hurdle.
Employee Awards
We grant stock-based compensation in the form of LTIP Units as a part of our annual incentive compensation to various employees each year, a portion which vests at the date of grant, and the remainder which vests in three equal annual installments over the three calendar years following the grant date. Compensation expense for LTIP Units which are not vested at the grant date is recognized on a straight-line basis over the requisite service period for each separately vesting portion of the award. We have also made long-term grants in the form of LTIP Units to certain employees, which generally vest in equal annual installments over to calendar years following the grant date, and some of these grants include a portion which vests at the date of grant. In aggregate, we granted 3.2 million, 1.9 million, and 2.2 million LTIP Units to employees during 2025, 2024 and 2023, respectively.
Non-Employee Director Awards
As annual fees for their services, each of our non-employee directors receives a grant of LTIP Units that vests on a quarterly basis during the year the services are rendered, which is the calendar year following the grant date. In aggregate, we granted 127 thousand, 94 thousand, and 146 thousand LTIP Units to our non-employee directors during 2025, 2024 and 2023, respectively.
Compensation Expense
See Note 2 regarding our accounting policy for stock based compensation. At December 31, 2025, the total unrecognized stock-based compensation expense for unvested LTIP Unit awards was $19.5 million, which will be recognized over a weighted-average term of 2 years. The table below presents our stock-based compensation expense:
| Year Ended December 31, | |||||||||||||||||
| (In thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| Stock-based compensation expense, net | $ | 21,208 | $ | 21,038 | $ | 19,834 | |||||||||||
| Capitalized stock-based compensation | $ | 6,022 | $ | 6,139 | $ | 6,016 | |||||||||||
Stock-Based Award Activity
The table below presents our unvested LTIP Units activity:
| Unvested LTIP Units: | Number of Units (Thousands) | Weighted Average Grant Date Fair Value | Grant Date Fair Value (Thousands) | |||||||||||||||||
| Outstanding at December 31, 2022 | 1,600 | $ | 15.73 | |||||||||||||||||
| Granted | 2,384 | $ | 10.89 | $ | 25,959 | |||||||||||||||
| Vested | (1,970) | $ | 12.97 | $ | 25,555 | |||||||||||||||
| Forfeited | (17) | $ | 18.70 | $ | 327 | |||||||||||||||
| Outstanding at December 31, 2023 | 1,997 | $ | 12.64 | |||||||||||||||||
| Granted | 1,945 | $ | 14.38 | $ | 27,970 | |||||||||||||||
| Vested | (1,948) | $ | 13.85 | $ | 26,991 | |||||||||||||||
| Forfeited | (49) | $ | 14.65 | $ | 714 | |||||||||||||||
| Outstanding at December 31, 2024 | 1,945 | $ | 13.12 | |||||||||||||||||
| Granted | 3,291 | $ | 8.54 | $ | 28,096 | |||||||||||||||
| Vested | (2,721) | $ | 9.94 | $ | 27,051 | |||||||||||||||
| Forfeited | (27) | $ | 15.39 | $ | 423 | |||||||||||||||
| Outstanding at December 31, 2025 | 2,488 | $ | 10.50 | |||||||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 20, 2026 | Showing above |
| 2024 | Feb 14, 2025 | |
| 2023 | Feb 16, 2024 | |
| 2022 | Feb 17, 2023 | |
| 2021 | Feb 18, 2022 | |
| 2020 | Feb 22, 2021 | |
| 2017 | Feb 16, 2018 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.