Health care REIT HCP, Inc. (NYSE: HCP) on Oct. 3 announced a transition in its top management. Lauralee Martin, 62, has taken over for Jay Flaherty as president and CEO of the company, while Michael D. McKee, 67, is replacing Flaherty as chairman of the company’s board of directors.
The company also announced that Kenneth B. Roath, 77, HCP’s chairman emeritus and the company’s first president, has decided to step down from the board of directors. Roath served as HCP’s CEO and chairman from 1988 to 2003.
During a conference call following the announcement, McKee said the decision to remove Flaherty from his position as chairman, president and CEO was not related to the firm’s stock performance or business performance. McKee and Martin emphasized that despite the move, company strategy has no plans to alter its current strategy.
“This is not about a new direction or a new strategy, but it’s about leadership,” McKee said. “We appreciate the contributions that Jay has made over the last decade.”
The board’s view that the HCP platform is “in very good shape” actually helped precipitate the move, according to McKee.
“From the perspective of the board, we felt that this was actually a good time to make a transition because of the current strength of the company,” he said.
“HCP is experiencing positive momentum and achieving consistent financial results,” Martin said in a release accompanying the announcement.
While serving as chief executive of the Americas division of Jones Lang LaSalle, Inc., Martin has been a member of HCP’s board of directors for the last five years. Martin joined Jones Lang as chief financial officer in 2002. She added the position of chief operating officer to her responsibilities in 2005 and became a member of the Jones Lang board of directors that year. She was named head of the firm’s Americas division earlier this year.
In a note to clients, Richard Anderson, a REIT analyst with BMO Capital Markets, speculated that the decision to replace Flaherty could lead to further attrition in the firm’s management ranks.
Flaherty will retain his seat on the company’s board until the end of the year, according to McKee, at which point his status will be re-evaluated.
Through midday trading, HCP’s stock price had fallen 4.3 percent from the previous day’s close.