A few LinkedIn connections of mine, notably a Director at CBRE and an MD at Walker & Dunlop, closed +$1B in RE debt financings (bridge, refins, agency, etc) this year. Teams probably consisted of 4 to 6 individuals. How much do guys like this pull in annually?
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Depends on a lot but assuming $1B of deals at an average fee of 75bps = $7,5m pre-house split. Say the house takes 40%, that leaves $4.5m amongst the entire team. If these teams have one team lead and a few supporting brokers and support staff, I would expect the lead guy to take home over half of that.
Again, there are a ton of variables here. House may or may not front salaries for support staff so that could eat into the pie too.
Damn, that's a ton! Would you say debt brokerage is among careers with the highest ceilings in RE? That's more than investment banking!
Usually The top Sales brokers make more than debt brokers but debt brokers have more volume (more frequent deals) and more repeat deals from the same clients.
People on WSO don’t talk enough about the broker route Bc it’s not as “prestigious” as private equity. In reality, even if you just close a few deals a year, you can make more than VP level at a REPE 50 shop. It’s a very underrated path in my opinion.
Yep you would be surprised what some of these brokers take home annually. I work in debt financing and we have several MD’s (under one senior MD) who all take home $1MM+ pretty consistently.
Brokerage in general. IS guys probably have the highest ceiling but as already mentioned debt is more consistent income.
Leasing guys can make an absolute ton of money as well in the right markets (i.e. top office leasing brokers in NYC).
Not my cup of tea but if you're in it for the paycheck (or just love sales) and you have the networking and sales ability to excel in that type of role then that's your best route.
75bps is typical for Middle Markets. To pull in $1B+, I'm assuming that the team did some very large deals which usually have much smaller payouts unless there were 3+ originators on the team all doing a crap ton of MM deals. If that was the case, then the payout will be more evenly distributed among the team. I'd still expect that the MD pulled in $1.5MM+. The absolute top guys in the field (top 10 producers nationally) regularly pull in low to mid 7 figures.
Stolly & Roeschlaub / Appel have to be north of $10m each right?
This is going to depend on what type of shop a person is at, but a $1B team on the debt side is likely pulling in much more than 75 bps gross fee income.
I work at an agency shop, and we get paid an (a) origination fee (typically anywhere from 0.25% - 1.00% depending on deal size) + servicing credits (typically is 4.5 x 8 -12 bps) + a 25 bps syndication fee (if Freddie Mac). There's also the opportunity to bake in additional yield premium into the rate stack, which generates more fee income on the backend. Our team doesn't bake in additional points often, but I know for certain that there are some monster teams out there pulling in an addition 1/2 - 3/4 point fee on the backend to the tune of 3-4 bps to their borrowers.
& Don't get me started on HUD deals... In yesteryears falling interest rate environment, your banker was generating anywhere from 200 - 800 bps on the back end of a 223(f) or d(4). That's the result of your gross coupon being 3.25% at quote but then dropping to 2.30% at par by the time you're ready to close. Banker's will tell their client that the rate today is 2.50%, which they're happy with, & pocket the difference.
HUD is absurd. I’ve heard of top HUD originators clearing $10MM+. I could be wrong on this, but I feel like for the most part, investment sales brokers have a higher ceiling for all in comp but there are more debt brokers / originators making $1MM+ than investment sales brokers making $1MM+
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