| | | | Sincerely, | |
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Evan H. Zucker
Chairman of the Board of Directors |
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For the Board of Directors of
Ares Industrial Real Estate Income Trust Inc. |
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| | | | By Order of the Board of Directors, | |
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Joshua J. Widoff
Managing Director Chief Legal Officer and Secretary |
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Nominee
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Business Experience and Qualifications
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Evan H. Zucker
Chairman of the Board of Directors Age: 56 Director since November 2014 Member of Investment Committee |
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Evan H. Zucker has served as the Chairman of our Board of Directors and as a director since November 2014. During the past five years, Mr. Zucker has served as a manager of our former advisor, BCI IV Advisors LLC, and Black Creek Diversified Property Advisors LLC, the former advisor to Ares Real Estate Income Trust, Inc. (“AREIT”). Mr. Zucker continues to participate in the management of the current Advisor following the sale of our former advisor to an affiliate of Ares Management Corporation (“Ares”). Mr. Zucker also served as the Chairman of the board of directors and as a director of Industrial Property Trust Inc. (“IPT”). Mr. Zucker is a principal of Black Creek Group (“BCG”), a Denver based real estate investment firm which he co-founded in 1993. As of June 30, 2021, Mr. Zucker has overseen directly, or indirectly through affiliated entities, the acquisition, development, redevelopment, financing and sale of real estate related assets with an aggregate value in excess of approximately $24.9 billion. Mr. Zucker also was a co-founder and formerly served as a director of DCT Industrial Trust, formerly known as Dividend Capital Trust, a NYSE listed industrial REIT (NYSE: DCT). Mr. Zucker has been active in real estate acquisition, development and redevelopment activities since 1989. In 1993, Mr. Zucker co founded American Real Estate Investment Corp., which subsequently became Keystone Property Trust (NYSE: KTR), an industrial, office and logistics REIT that was later acquired by ProLogis Trust (NYSE: PLD) in August 2004. Mr. Zucker served as the President and as a director of American Real Estate Investment Corp. from 1993 to 1997 and as a director of Keystone Property Trust from 1997 to 1999. Mr. Zucker graduated from Stanford University with a Bachelor’s Degree in Economics.
We believe that Mr. Zucker’s qualifications to serve on our Board of Directors are demonstrated by his proven business acumen, including his over 25 years of experience with BCG as a co-founder of the company, and his vast experience as a leader of an advisor to real estate investment companies, including DCT Industrial Trust, AREIT, Industrial Income Trust Inc., IPT, and American Real Estate Investment Corp. (which subsequently became Keystone Property Trust, NYSE: KTR).
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Dwight L. Merriman III
Director Age: 61 Director since November 2014 Member of Investment Committee |
| | Dwight L. Merriman III has served as a member of our Board of Directors and as a member of the board of managers of our former advisor since November 2014. Mr. Merriman continues to participate in the management of the current Advisor following the sale of our former advisor to an affiliate of Ares. Mr. Merriman served as our Managing Director from May 2017 through December 2019 and as our Chief Executive Officer from November 2014 through December 2019. In addition, Mr. Merriman served as a trustee of DC Industrial Liquidating Trust from November 2015 through December 2017. During the | |
Nominee
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Business Experience and Qualifications
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past five years, Mr. Merriman has also held similar leadership roles at BCG, and is responsible for the oversight of the acquisition, asset management and portfolio management activities for all industrial investments across funds sponsored by affiliates of BCG. Prior to joining the Company, Mr. Merriman served from September 2007 through March 2010 as a Managing Director and the Chief Investment Officer of Stockbridge Capital Group LLC, or “Stockbridge,” a real estate investment management company based in San Francisco, California, which had more than $3 billion in real estate under management. While with Stockbridge, Mr. Merriman served as a member of its investment and management committees, and was responsible for coordinating the investment activities of the company. From May 2000 to September 2007, Mr. Merriman was a Managing Director of RREEF Funds, or “RREEF,” a real estate investment management company, in charge of RREEF’s development and value added investment opportunities in North America. While at RREEF, he served on the investment committee and was involved in approving approximately $5 billion in commercial real estate transactions, and he started CalSmart, a $1.2 billion value added real estate investment fund with the California Public Employees’ Retirement System. Prior to joining RREEF in 2000, Mr. Merriman served for approximately five years as a Managing Director at Carr America Realty Corporation, where he was responsible for the company’s acquisition, development and operations activities in Southern California and Utah. Prior to that, he spent 11 years with the Los Angeles development firm of Overton, Moore & Associates, where he was responsible for developing industrial and office property throughout Southern California. Mr. Merriman received a B.S. in Business Administration from the University of Southern California and an M.B.A. from the Anderson School at the University of California at Los Angeles. Mr. Merriman is a member of the Urban Land Institute.
We believe that Mr. Merriman’s qualifications to serve on our Board of Directors include over 30 years of extensive real estate investment and development experience, including specifically his experience serving in leadership positions and on the investment committees of significant real estate investment funds.
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Rajat Dhanda
Managing Director, Co-President and Director Age: 53 Director since August 2021 |
| | Rajat Dhanda has served as our Managing Director, Co-President since December 9, 2019, our Managing Director, President from May 2017 to December 9, 2019, and our Director since August 18, 2021. Mr. Dhanda also has served as the Managing Director, Co-President of AREIT since December 10, 2019 and served as the Managing Director, President of AREIT from April 2017 to December 10, 2019. He also has served as a director of AREIT since March 2020. Mr. Dhanda currently serves as Chief Executive Officer of BCG and is responsible for the oversight of distribution, marketing, product development, operations and legal functions. Prior to joining BCG, Mr. Dhanda spent 26 years at Morgan Stanley, leading key divisions of their institutional and Wealth Management | |
Nominee
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Business Experience and Qualifications
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platforms, while also serving on the firm’s Management and Risk Committee for his last eight years. Most recently, he was head of Investment Products and Services in Wealth Management, which was responsible for all of the products distributed by Morgan Stanley’s financial professionals. In this capacity, he worked closely with the firm’s financial professionals and third party asset managers to design and distribute products offering a breadth of investment solutions. In addition, as a member of the division’s Executive and Operating Committees, Mr. Dhanda worked to develop strategies for the changing regulatory environment and the opportunities that technology and data offer today in the wealth management channels. Mr. Dhanda holds a B.A. in both Business Economics, as well as Organizational Behavior & Management from Brown University.
We believe that Mr. Dhanda’s qualifications to serve on our Board of Directors include his history of leadership at the Company and the 26 years of significant experience he acquired by serving in leadership positions at Morgan Stanley, which brings to our Board of Directors valuable knowledge of the capital markets and financial products.
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Marshall M. Burton
Independent Director Age: 53 Director since August 2015 Member of Audit Committee Member of Nominating and Corporate Governance Committee Member of Investment Committee Member of Conflicts Resolution Committee |
| | Marshall M. Burton has served as an independent director on our Board of Directors since August 2015. In addition, during the past five years, Mr. Burton has served as an independent director on the board of directors of IPT, as an independent trustee of DC Industrial Liquidating Trust, and as a director and President of both MVG, Inc. and Confluent Development, L.L.C. Mr. Burton has more than 20 years of commercial real estate experience, including development, leasing, investment and management. In March 2014, Mr. Burton founded Confluent Holdings, L.L.C. to develop and invest in office, industrial and multi-family projects throughout the U.S. In April 2015, Mr. Burton expanded Confluent Holdings, L.L.C. and co-founded Confluent Development, L.L.C. in a merger with MVG, Inc., to form a diverse real estate investment and development platform with projects in various stages of development totaling $500 million. From March 2011 to March 2014, Mr. Burton served as Senior Vice President and General Manager of Opus Development Company L.L.C., an affiliate of The Opus Group, a real estate developer, or “Opus,” where he was responsible for managing operations and seeking new development opportunities in Denver, Colorado and in the western region of the U.S. Prior to joining Opus, Mr. Burton founded the Denver office of McWhinney, a real estate development company, in February 2010. As Senior Vice President of McWhinney, Mr. Burton oversaw operations for the commercial development team in the Denver metropolitan area and other strategic locations across the western U.S. Mr. Burton served as the Senior Vice President of Opus Northwest, L.L.C., a full service real estate developer, from May 2009 through February 2010, and previously served as Vice President from October 2002 through September 2008 and in other capacities beginning in 1996. Prior to joining Opus in 1996, Mr. Burton | |
Nominee
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Business Experience and Qualifications
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was co-founder of Denver Capital Corporation, a multi-bank community lending organization. Mr. Burton is a licensed Colorado Real Estate Broker and is active in many civic and real estate associations, including serving as Treasurer and President elect of the National Association of Industrial and Office Properties and as an executive committee member of the Urban Land Institute. Mr. Burton received his Bachelor of Science in Business Administration from the University of Denver.
We believe that Mr. Burton’s qualifications to serve on our Board of Directors include his over 20 years of experience overseeing the development, leasing, investment and management of commercial real estate. This experience provides a valuable perspective on the commercial real estate industry.
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Charles B. Duke
Independent Director Age: 64 Director since February 2016 Chairman of Audit Committee Member of Nominating and Corporate Governance Committee Member of Investment Committee |
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Charles B. Duke has served as an independent director on our Board of Directors since February 2016. In addition, during the past five years, Mr. Duke has served as an independent director and independent trustee, as applicable, of IPT and AREIT. Mr. Duke is currently Founder and Chief Executive Officer of To Table Inc. (“To Table”), a retailer of specialty gourmet foods. Prior to founding To Table in November 2014, Mr. Duke was involved in the management of two ink jet cartridge remanufacturers and aftermarket suppliers. Mr. Duke served as the Executive Vice President of IJR, Inc. in Phoenix, Arizona from October 2012 to July 2014 and as Founder, President and Chief Executive Officer of Legacy Imaging, Inc., from 1996 through 2012. Mr. Duke has been active in entrepreneurial and general business activities since 1980 and has held several executive and management roles throughout his career, including Founder, President and Owner of Careyes Corporation, a private bank, registered investment advisor and a member of the Financial Industry Regulatory Authority (“FINRA”) based in Denver, Colorado, Chief Financial Officer at Particle Measuring Systems, a global technology leader in the environmental monitoring industry based in Boulder, Colorado, and Vice President of Commercial Loans at Colorado National Bank. Mr. Duke also spent four years with Kirkpatrick Pettis, the investment banking subsidiary of Mutual of Omaha, as Vice President of Corporate Finance, involved primarily in mergers and acquisitions, financing and valuation activities. Mr. Duke graduated from Hamilton College in 1980 with a Bachelor’s Degree in Economics and English.
Our Board of Directors has determined that Mr. Duke is the audit committee financial expert. In that role, we believe that Mr. Duke brings a unique perspective to the audit committee, as he is the only audit committee member with investment banking experience. We believe Mr. Duke’s qualifications to serve on our Board of Directors include his considerable business and financial experience, including specifically his experience as founder and president of a private bank and as Chief Financial Officer of a significant organization.
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Nominee
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Business Experience and Qualifications
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Stanley A. Moore
Independent Director Age: 83 Director since August 2015 Chairman of Nominating and Corporate Governance Committee Chairman of Investment Committee Member of Conflicts Resolution Committee |
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Stanley A. Moore has served as an independent director on our Board of Directors since August 2015. In addition, during the past five years, Mr. Moore has served as an independent director and independent trustee, as applicable, of IPT and DC Industrial Liquidating Trust. Mr. Moore is a Co-Founder and Chairman and the former Chief Executive Officer of Overton Moore Properties, or “OMP,” a leading commercial real estate development firm in Los Angeles County that develops, owns and manages office, industrial and mixed use space. He served as Chief Executive Officer of OMP from 1975 until January 2010 and has served as a director since 1972. Since its founding, OMP has developed and/or invested in over 30 million square feet of commercial space in California. Mr. Moore served as a member of the board of directors of The Macerich Company (NYSE: MAC), a leading owner, operator and developer of major retail properties, from 1994 through May 2015. Mr. Moore is past President of the Southern California Chapter of the National Association of Industrial and Office Parks, and is currently a board member of the Economic Resources Corporation of South Central Los Angeles. His many awards and citations include the Humanitarian of the Year awarded to him by the National Conference of Christians and Jews.
We believe that Mr. Moore’s qualifications to serve on our Board of Directors include his over 36 years of experience as a Chief Executive Officer of a leading commercial real estate development firm, his expertise in the areas of acquisitions, development and management of commercial real estate, and more specifically, industrial properties, his leadership experience with the National Association of Industrial and Office Parks, and his service on civic and private and public company boards.
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John S. Hagestad
Independent Director Age: 75 Director since August 2015 Member of the Audit Committee Member of Investment Committee Member of Conflicts Resolution Committee |
| | John S. Hagestad has served as an independent director on our Board of Directors since August 2015. In addition, during the past five years, Mr. Hagestad has served as an independent director and independent trustee, as applicable, of IPT. Mr. Hagestad is Senior Managing Director and Co-Founder of SARES•REGIS Group, a vertically integrated real estate development services company focusing on both commercial and residential real estate. Mr. Hagestad has served in this role since 1993 and is responsible for overseeing all of SARES•REGIS Group’s commercial activities which includes the development, investment and management divisions. Mr. Hagestad serves on SARES•REGIS Group’s Executive Management Committee which approves all property acquisitions and investment decisions and provides strategic planning for the future. During his career, Mr. Hagestad has been responsible for the acquisition and development of over 85 million square feet of commercial, office and industrial property totaling more than $6 billion in value. In 1972, he joined the Koll Company as a Vice President for project acquisition and development. Three years later he joined The Sammis Company as a founding partner responsible for all matters of finance and administration, with emphasis on lender and partner relationships. In 1990, Mr. Hagestad became | |
Nominee
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Business Experience and Qualifications
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President and Chief Executive Officer of the SARES Company (the successor to The Sammis Company), where he was instrumental in its merger with The Regis Group to create the SARES•REGIS Group in 1993. Mr. Hagestad is a Certified Public Accountant and holds a bachelor’s degree in Business Administration and a master’s degree in Finance from the University of Southern California. He is a past trustee of the Urban Land Institute, a member of the Marshall School of Business Board of Leaders at the University of Southern California, the UCI Center for Real Estate, The Fisher Center for Real Estate and Urban Economics at UC Berkeley and the Real Estate Roundtable. He is also on the Board of Trustees / Directors for the Cystinosis Research Foundation.
We believe that Mr. Hagestad’s qualifications to serve on our Board of Directors include his over 40 years of involvement in overseeing the development, acquisition and management of commercial, office and industrial real estate, in addition to his valuable accounting background. This experience provides a valuable perspective on the various facets of the real estate industry.
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Name
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Age
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Position
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Jeffrey W. Taylor | | |
49
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| | Managing Director, Co-President | |
Scott A. Seager | | |
41
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| | Principal, Chief Financial Officer and Treasurer | |
Scott W. Recknor | | |
54
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| | Managing Director, Head of Asset Management | |
Joshua J. Widoff | | |
51
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| | Managing Director, Chief Legal Officer and Secretary | |
Name
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Fees Earned or
Paid in Cash(1) |
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Stock Awards(2)
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Total
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Marshall M. Burton
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| | | $ | 150,000 | | | | | $ | 75,000 | | | | | $ | 225,000 | | |
Charles B. Duke
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| | | $ | 165,000 | | | | | $ | 75,000 | | | | | $ | 240,000 | | |
John S. Hagestad
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| | | $ | 150,000 | | | | | $ | 75,000 | | | | | $ | 225,000 | | |
Stanley A. Moore
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| | | $ | 170,000 | | | | | $ | 75,000 | | | | | $ | 245,000 | | |
Plan Category
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Number of securities
to be issued upon exercise of outstanding options, warrants and rights |
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Weighted-average
exercise price of outstanding options, warrants and rights |
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Number of securities
remaining available for future issuance under equity incentive plans |
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Equity compensation plans approved by security
holders |
| | | | 291,844 | | | | | | — | | | | | | 1,310,068 | | |
Equity compensation plans not approved by security holders
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| | | | 16,036 | | | | | | — | | | | | | 1,953,784 | | |
Total
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| | | | — | | | | | | — | | | | | | 3,263,852 | | |
Name of Beneficial Owner(1)
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Title
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Amount and Nature of
Beneficial Ownership(1) |
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Percent of
Common Stock |
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Evan H. Zucker
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Chairman, Director
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19,253 shares
2,047,831 OP Units(2) |
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*
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Dwight L. Merriman III
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Director
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28,092 shares
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*
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Marshall M. Burton
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Director
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27,116 shares
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*
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Stanley A. Moore
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Director
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27,116 shares
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*
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John S. Hagestad
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Director
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29,737 shares
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*
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Charles B. Duke
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Director
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27,116 shares
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*
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Rajat Dhanda
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Managing Director, Co-President
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98,009 shares
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*
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Jeffrey W. Taylor
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Managing Director, Co-President
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7,321 shares
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*
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Scott A. Seager
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Principal, CFO and Treasurer
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8,454 shares
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*
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Joshua J. Widoff
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Managing Director,
Chief Legal Officer and Secretary |
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2,960 shares
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*
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Scott W. Recknor
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Managing Director,
Head of Asset Management |
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—
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*
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Beneficial ownership of common stock and OP Units by all directors and executive officers as a group
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—
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2,323,005 shares/
OP Units |
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*
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For the Years Ended
December 31, |
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Payable as of
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(in thousands)
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2021
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2020
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2019
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December 31,
2021 |
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December 31,
2020 |
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Selling commissions and dealer manager fees – the Dealer Manager(1)
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| | | $ | 15,046 | | | | | $ | 39,190 | | | | | $ | 11,697 | | | | | $ | — | | | | | $ | — | | |
Ongoing distribution fees – the Dealer Manager(1)(2)
|
| | | | 16,022 | | | | | | 10,634 | | | | | | 3,535 | | | | | | 1,779 | | | | | | 1,122 | | |
Advisory fee – fixed component – the
Advisor |
| | | | 28,558 | | | | | | 9,653 | | | | | | 4,585 | | | | | | 3,864 | | | | | | 1,345 | | |
Performance participation allocation – the Advisor
|
| | | | 81,185 | | | | | | 9,640 | | | | | | 2,913 | | | | | | 81,185 | | | | | | 9,640 | | |
Other expense reimbursements – the
Advisor(3)(4) |
| | | | 11,434 | | | | | | 9,928 | | | | | | 8,706 | | | | | | 707 | | | | | | 2,706 | | |
Property accounting fee – the Advisor(5)
|
| | | | 1,262 | | | | | | 603 | | | | | | 313 | | | | | | 166 | | | | | | 59 | | |
DST Program selling commissions, dealer manager fees and distribution fees – the Dealer Manager(1)
|
| | | | 3,527 | | | | | | — | | | | | | — | | | | | | 190 | | | | | | — | | |
Other DST Program related costs – the
Advisor(4) |
| | | | 5,925 | | | | | | — | | | | | | — | | | | | | 61 | | | | | | — | | |
Development fees – the Advisor(6)
|
| | | | 937 | | | | | | 24 | | | | | | — | | | | | | 78 | | | | | | 24 | | |
Total
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| | | $ | 163,896 | | | | | $ | 79,672 | | | | | $ | 31,749 | | | | | $ | 88,030 | | | | | $ | 14,896 | | |
| Dated: March 31, 2022 | | |
Independent Directors of the Company
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| | | | Marshall M. Burton | |
| | | | Charles B. Duke | |
| | | | John S. Hagestad | |
| | | | Stanley A. Moore | |
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For the Year Ended
December 31, 2021 |
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For the Year Ended
December 31, 2020 |
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Audit Fees
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| | | $ | 784,000 | | | | | $ | 687,000 | | |
Audit-Related Fees
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| | | | — | | | | | | — | | |
Tax Fees
|
| | | | — | | | | | | — | | |
All Other Fees
|
| | | | — | | | | | | — | | |
Total
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| | | $ | 784,000 | | | | | $ | 687,000 | | |
| | | | By Order of the Board of Directors, | |
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Joshua J. Widoff
Managing Director Chief Legal Officer and Secretary |
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