REAL ESTATE : Home Builder James M. Peters Earned $6.7 Million in ‘87, Most of It a Bonus

James M. Peters earned nearly $6.7 million last year, most of it a bonus for staying on as chairman, president and chief executive of Newport Beach home builder J.M. Peters Co. after selling it to Dallas’ Southmark Corp. in 1985.

Southmark, in turn, sold nearly 13% of the company’s stock to the public, and the information about Peters’ earnings was included in the company proxy mailed to shareholders this week.

Peters earned $376,000 in salary and $6.3 million under an earnout agreement with Southmark that pays Peters a percentage of the company’s earnings each year. That makes him one of the highest-paid executives in the nation, just below Walt Disney Co. Chairman Michael Eisner, who held 19th place with earnings of $6.7 million in a recent BusinessWeek magazine survey of top U.S. executives’ earnings.

Peters’ company builds upscale homes for the “move-up” market, composed of buyers who already own homes and who want bigger or more lavish houses. The company is one of the more profitable builders in Southern California.

J.M. Peters Co. recently reported earnings of $7.3 million for its first quarter ending May 31, up from $2.2 million last year. Revenues rose to $86.9 million, up from $51 million last year.

Southmark Corp., a Dallas financial services and real estate company, paid $19 million in cash for the company three years ago and said it is considering selling more of its stake in Peters to the public.