2020: Real Estate Bonuses
Out of total curiosity, does anyone know what real estate bonuses are going to look like this year? Would you expect many to be slashed to zero? I'm interested to hear what people may know, interested in the distinction between brokerage, PE, banks, dev, etc.
It'll be entirely firm dependent, but I'd expect bonuses to take a hit just about everywhere. People at retail or hospitality-focused companies are probably seeing a whole lotta nothing this year, but multifamily shops might just be business as usual or take a slight cut.
Neither Bonus nor Dividends have been distributed
Confirmed no bonuses for our firm. Certain salaries above a threshold were reduced by a percentage as well.
What area/sector are you in and typically do bonus make up a big % of total comp?
Diversified operator but primarily focused on office. I work on both Acq. & AM. Bonuses make up less as a % of total comp than a lot of other shops.
My bonus doesn't get paid until the final paycheck of the year and is 100% "discretionary."
At this point I think I'll be going in not expecting anything - but who knows what the world will look like 6 months from now.
Bonus was cut here at my firm. Value-add operator with retail/office/mf assets. Small team but was told it was for everyone to keep everyone staffed.
Bummer because I took a pay cut to get into this role and my salary is already 20% under market. The small equity I have isn't worth anything at this point as well.
Woof.
Looks like it will be down, but not zero. Even if it was, no one in my group is going anywhere. Too much deferred comp tied up.
REPE RED team, assuming nothing
Where are you based? What would you expect for bonus during normal times?
NYC. Would have expected 100-150% plus in normal times.
Still trying to swallow it. Frustrating lol
Wow... I work as an Analyst in a PERE RED team. Hoping that bonuses won't be cut completely
Note, there are layoffs in the industry (even banking). So still need to keep perspective, but just a shit time.
Most CMBS teams are/were closed up, most debt teams at REPE debt/debt fund/commercial mreits are temp closed up... or very very cautious. YE2020 P&L on these groups are going to be brutal... luckily the BB RE teams/CMBS teams could hopefully swing some bonus funds from non-related depts. (still gotta be shit $$), but the smaller/housed outside of IB groups presumably will have $0 bonus (again this is not confirmed for me but all but understood by most transaction deal teams).
There are a couple forums on there but RE is obviously getting crushed in this... id say worst fucked industry (fed barely helping, all local/state assistance more or less overlooks RE and fucks the LL, which trickles to lender, trickles to bondholders, etc.). No evictions, rent/mortgage moratorium dialogue, believe NYC voided all personal rent guarantees to commercial tenants (i.e. retail shops closed)... and FED has essentially overlooked RE. Understandably it's an insane time, but all the relief is geared to tenants (individual or biz), with what looks to be a deliberate oversight on the direct impact on owners/lenders/investors (bc "fuck the banks man" politicians who cannot comprehend the full market relationship... and are fucking these groups that are hurting due to an imposed government shut down (i.e. solution worse than the problem).
Little rant there lol
I am hopeful for a good bonus this year, the pandemic shifted a lot of institutional interest in the multifamily space. We raised a lot more than we were targeting this year. My bonus is paid through our AM fees, which are increasing as a result.
Of course our principals could just pull the whole pandemic-you-are-lucky-to-have-a-job-right-now card and keep any extra for themselves.¯_(ツ)_/¯
Really interesting how this will pan out in the future by sector. Office will obviously be hurting for at least a few years, industrial (at least Prologis) seems to be slaughtering rn, retail is not looking good (especially B/C malls) and multi-family is kind of in a ?? position in my opinion as millennials may choose to gravitate towards suburbs and purchase single family homes if their offices allow wfh a few days a week.
We tend to focus on mostly suburban multi, and this pandemic has stalled a lot of development, which was already in short supply for most markets as it is. So we feel good about the supply/demand dynamic. Homebuying can vary by market, in the northeast it's almost impossible to find a reasonably priced home for a millenial couple starting out. In fact, i remember in march/early april people were coming out of the woodwork and paying HIGHER than ask just to lock something down in fear that the market will be stalled for a few years. Looks like things are bouncing back but the "starter home" supply/demand metrics are also very favorable for multi.
I would avoid taking the onslaught of think-pieces about the death of office and mass migration of apartment users as gospel.
Office will be fine and young people will still want to be in cities.
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