FEDERAL REALTY INVESTMENT TRUSTFRT
FEDERAL REALTY INVESTMENT TRUST Stock Compensation Disclosure
SHARE-BASED COMPENSATION PLANS
A summary of share-based compensation expense included in net income is as follows:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Grants of common shares, restricted stock units, and options | $ | 15,561 | $ | 17,379 | $ | 15,427 | |||||||||||
| Capitalized share-based compensation | (953) | (1,022) | (1,119) | ||||||||||||||
| Share-based compensation expense | $ | 14,608 | $ | 16,357 | $ | 14,308 | |||||||||||
As of December 31, 2025, we have grants outstanding under two share-based compensation plans. In May 2020, our shareholders approved the 2020 Performance Incentive Plan ("the 2020 Plan"), which authorized the grant of share options,
common shares, and other share-based awards for up to 1,750,000 common shares of beneficial interest. Our 2010 Long Term Incentive Plan, as amended (the "2010 Plan”), which expired in May 2020, authorized the grant of share options, common shares and other share-based awards for up to 2,450,000 common shares of beneficial interest.
Option awards under the plans are required to have an exercise price at least equal to the closing trading price of our common shares on the date of grant. Options and restricted share awards under the plan generally vest over to seven years and option awards typically have a -year contractual term. We pay dividends on unvested shares. Certain options and share awards provide for accelerated vesting if there is a change in control. Additionally, the vesting on certain option and share awards can accelerate in part or in full upon termination without cause.
The fair value of each option award is estimated on the date of grant using the Black-Scholes model. Expected volatilities, term, dividend yields, employee exercises and estimated forfeitures are primarily based on historical data. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair value of each share award is determined based on the closing trading price of our common shares on the grant date. No options were granted in 2025 and 2023. The following table provides a summary of the assumptions used to value options granted in 2024:
| Year Ended December 31, | |||||
| 2024 | |||||
| Volatility | 31.9 | % | |||
| Expected dividend yield | 4.3 | % | |||
| Expected term (in years) | 7.5 | ||||
| Risk free interest rate | 4.1 | % | |||
The weighted-average grant-date fair value of options granted in 2024 was $24.59 per share. The following table provides a summary of option activity for 2025:
| Shares Under Option | Weighted- Average Exercise Price | Weighted- Average Remaining Contractual Term | Aggregate Intrinsic Value | ||||||||||||||||||||
| (In years) | (In thousands) | ||||||||||||||||||||||
| Outstanding at December 31, 2024 | 3,019 | $ | 98.09 | ||||||||||||||||||||
| Granted | — | — | |||||||||||||||||||||
| Exercised | — | — | |||||||||||||||||||||
| Forfeited or expired | — | — | |||||||||||||||||||||
| Outstanding at December 31, 2025 | 3,019 | $ | 98.09 | 6.3 | $ | 9 | |||||||||||||||||
| Exercisable at December 31, 2025 | 1,701 | $ | 96.59 | 5.5 | $ | 7 | |||||||||||||||||
The following table provides a summary of restricted share award activity for 2025:
| Shares | Weighted-Average Grant-Date Fair Value | ||||||||||
| Unvested at December 31, 2024 | 268,220 | $ | 107.57 | ||||||||
| Granted | 146,086 | 110.17 | |||||||||
| Vested | (128,262) | 110.26 | |||||||||
| Forfeited | (5,489) | 121.76 | |||||||||
| Unvested at December 31, 2025 | 280,555 | $ | 107.42 | ||||||||
The weighted-average grant-date fair value of stock awarded in 2025, 2024 and 2023 was $110.17, $101.84 and $109.44, respectively. The total vesting-date fair value of shares vested during the year ended December 31, 2025, 2024 and 2023, was $14.0 million, $17.3 million and $14.4 million, respectively.
On February 10, 2021, 10,441 restricted stock units were awarded to an officer, of which 7,204 vested on January 7, 2025, based on meeting certain market based performance criteria. The amount of dividend equivalent rights related to these units is approximately $0.1 million, and was recorded against retained earnings for the year ended December 31, 2024. The weighted-average grant-date fair value of the restricted stock units awarded in 2021 was $97.01.
As of December 31, 2025, there was $17.2 million of total unrecognized compensation cost related to unvested share-based compensation arrangements (i.e. options and unvested shares) granted under our plans. This cost is expected to be recognized over the next 4.3 years with a weighted-average period of 1.8 years.
Subsequent to December 31, 2025, common shares were awarded under various compensation plans as follows:
| Date | Award | Vesting Term | Beneficiary | ||||||||||||||||||||
| January 2, 2026 | 7,786 | Shares | Immediate | Trustees | |||||||||||||||||||
| February 11, 2026 | 157,723 | Restricted Shares | 3-5 years | Officers and key employees | |||||||||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 12, 2026 | Showing above |
| 2024 | Feb 13, 2025 | |
| 2023 | Feb 12, 2024 | |
| 2022 | Feb 8, 2023 | |
| 2021 | Feb 10, 2022 | |
| 2020 | Feb 11, 2021 | |
| 2019 | Feb 10, 2020 | |
| 2018 | Feb 13, 2019 | |
| 2017 | Feb 13, 2018 | |
| 2016 | Feb 13, 2017 | |
| 2015 | Feb 9, 2016 | |
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.