- Push-out Score determined
- Praise for Naughton
- Ben Schall taking over
- Naughton will remain as Executive Chairman at AvalonBay
- Naughton made a lengthy statement and said 271 words
(exechange) — Arlington, Virginia, December 10, 2020 — Tim Naughton, chief executive of AvalonBay, leaves his post. His departure is made public at an early stage. As announced by AvalonBay Communities Inc. in a news release and in a regulatory filing published on Thursday, December 10, 2020, Timothy J. (Tim) Naughton leaves his post as chief executive officer of the real estate investment trust after 10 years in the role, effective December 31, 2021.
Long goodbye
It is a long goodbye. The announcement of Tim Naughton’s move comes up to 13 months prior to his planned departure from the post of CEO.
In general, a top executive who announces the departure particularly early may be considered a lame duck.
Tim Naughton’s duties as CEO will be taken over by Benjamin W. (Ben) Schall, currently Chief Executive Officer of Seritage Growth Properties.
The fact that Tim Naughton’s successor is brought in from outside suggests that the board may seek to stimulate change with fresh ideas and new initiatives.
“A thorough candidate search process”
Tim Naughton’s departure from the CEO post is explained as follows. W. Edward Walter, AvalonBay’s Lead Independent Director, said: “The Board’s appointment of Ben followed a thorough candidate search process in which we benefited from the Board’s focus on succession planning over the last several years.”
Naughton will remain as Executive Chairman at AvalonBay
“The Company also announced that Mr. Naughton plans to retire as Chief Executive Officer at the end of 2021 and that at such time Mr. Schall will be appointed as CEO and Mr. Naughton will remain on the Board in the position of Executive Chairman. Mr. Naughton’s role as Executive Chairman has yet to be defined, including whether it will be a full time or part time role,” AvalonBay said.
“Retire”
AvalonBay said: “Benjamin W. Schall has been appointed President of the Company and will join the Company’s Board of Directors, effective as of a mutually agreeable date on or before February 1, 2021. Additionally, the Company also announced that Timothy J. Naughton, the Company’s Chairman, Chief Executive Officer and President, plans to retire as Chief Executive Officer (CEO) at the end of 2021 and that at such time Mr. Schall will be appointed as CEO and Mr. Naughton will remain on the Board in the position of Executive Chair.”
Share price increase since January 2012
The announcement follows an increase in AvalonBay Communities Inc.’s share price of 28% since January 2012. January 2012 is the month in which Naughton’s tenure as CEO began.
In the position of CEO since 2012
Tim Naughton became CEO of the Company in 2012.
Naughton is the Company’s Chairman of the Board, Chief Executive Officer and President and has been a director of the Company since September 2005.
He has served as Chairman of the Board since May 2013, as Chief Executive Officer since January 2012, and as President since February 2005.
Naughton’s prior roles included serving as the Company’s Chief Operating Officer, Chief Investment Officer, and Regional Vice President – Development and Acquisitions. Naughton has been with the Company and its predecessors since 1989.
Naughton is a director of Park Hotels & Resorts, Inc., a publicly traded hotel real estate investment trust. He is a former Chairman of the National Association of Real Estate Investment Trusts (“NAREIT”).
Naughton is also a member of The Real Estate Round Table, is a member and past chairman of the Multifamily Council of the Urban Land Institute (“ULI”), and is a member of the Real Estate Forum.
He sits on the board of the Jefferson Scholars Foundation at the University of Virginia. Naughton received his Masters of Business Administration from Harvard Business School in 1987 and earned his undergraduate degree from the University of Virginia, where he was elected to Phi Beta Kappa.
Push-out Score determined
The Push-out Score™ determined by exechange gauges the pressure surrounding the management change on a scale of 0 to 10.
exechange reached out to AvalonBay and offered the company the opportunity to comment on the score.
Read the full story in the exechange report 50.2020 ($).