Acquisitions Comp - Fee and Promote splits?
For those of you in acquisitions and sourcing deals is expected of you, what are your splits on deals you source vs deals you didn’t source? I’ll start.. Base: $135k Bonus: $65k Acquisition fee: firm charges a 1.5% on purchase price Acquisition split: 15% of the fee on deals I source, 5% per deal I don’t source (ie sourced by others on team). Paid at closing. Promote: 10% of the promote on deals I source, 5% on rest. EDIT: adding below. Deal size / volume: $10m to $100m / $200m last year. Vesting period: 5 years
Base: $125k
Bonus: None
Acquisition Fee: Firm charges 1-2% (Some instance of zero if a highly leveraged deal)
Acquisition Split: Base of 5% of fee entitled to firm, additional 5% for sourcing the deal, and additional 5% if I bring an operating partner, max of 15%
Promote: Base of 3% of firms promoted position, additional 3% if I sourced the deal, and additional 3% if I bring operating partner, max of 9% of firms promoted position
Awesome. Vesting period for the promote? What’s a typical deal size?
No vesting period so that’s good. Deal flow is solid but getting them closed has been shit so the whole structure has been pretty bad so far. Deal size range from as low as 2M to 150M. Larger deals tend to not have an acquisition fee.
Base: $160k
Bonus: $40k
Acquisition Fee: Group gets 60 bps on avg. I get 25% of that on deals I source, and a flat $10k on all others.
Promote: I get 20% of interest on deals I source, flat fee on all others.
Thanks for sharing. What was your team’s deal volume for last year? Average purchase price? Are you vested right away or is there a vesting period?
Bump
Damn I feel like I’m getting screwed with these numbers. At a pretty big institutional operator. Can anyone chime in?
SVP 10YOE+
Cash comp: $275k
Acq. Fee: firm charges 1%, I get a flat $17.5k for deals that I source, and nothing for others (deals are ~$50-$100m)
Promote: 5% on deals I source vesting over time
Looking at what others have said and comp reports, think I should be $400k cash minimum and getting a % of acq fee
Once you hit VP (Director in my case), comp at institutional operator is usually 1/3 base, 1/3 bonus, and 1/3 target promote (some years much more, some much less). Talking to friends at same level, cash is usually $350-$450k, and all in end up somewhere between $450-$650k. SVP I would expect cash comp to be in the all in range of a VP, with promote on top of that.
If you’re at a shop that is very top heavy / only cover a market or two and expectation is to buy a deal, maybe two per year, probably will be less than that. For example I know Bridge is mostly structured that way and pays less than elsewhere, that said way more WLB, lower production goals per person, and more people on staff that can help with your deals.
5% of promote on your deals is very generous, but is a bit of a roll of the dice and your vesting schedule becomes wildly important.
Thanks for your feedback. Do you know the comp structure at Bridge Investment Group for VP and beyond? They have an opening for a VP within the logistics group requesting 8-10 YOE with salary range from 235-275K. Given your feedback, I am assuming it's NOT 1/3 / 1/3 / 1/3, but I have no idea as I do not know anyone that works there. This would be for their Newport Beach office.
Yikes - being comped on acq fees sounds brokery...incentivizing deal quantity over quality.
I know this is slightly more focused on a specific type of comp, so not trying to derail the convo, but can check here to see if any data is valuable to you: https://www.wallstreetoasis.com/forum/real-estate/new-comp-database-goo…
What is this “promote” thing you speak of??
It's a Fugazzi, fairy dust
Bump
What asset class are you in?
I'm still fairly new to the industry and I'm getting pretty discouraged because nothing pencils...
Is my shop just bad or is no one doing deals?
Bump
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