Are there any sell-side brokers in the $1-5 M ticket range?

Curious to know if there's any non institutional sell-side brokers on this forum.

I'm coming from a resimmercial background but focus solely on commercial brokerage now with a very "boutique" local shop (think "I've never heard of you guys" when you make a call to a guy at CBRE) haha

I know what I do isn't really respected on this forum but my broker and me make a great team and our clients are mom & pop types who are for the most part, nice people to work with. We close deals in the 1-5 million range on the sell side with the occasional $300k commercial condo. It's a lot of fun and we usually keep the whole nut to ourselves. 

What's your experience like? Do you enjoy what you do?

Comments (20)

Most Helpful
  • Analyst 2 in RE - Comm
11mo

I'm not a broker but I work for one of the top teams in the $1M-$20M range. We'll occasionally work on institutional deals that are $50M-$100M+ but I'd say 80% of our deals are with mom and pops. The head brokers on the team rake in at least a few million a year net of split which I was surprised at when I first joined.

I always thought I wanted to work with larger institutional deals in the past since I jumped over from Corp finance, but I realized over the past year that the middle market brokers have a much more fun culture and environment compared to other teams that only focus on large institutional or portfolio deals. 

Not to drag this on but I've been in real estate for several years(haven't updated my title on WSO) and I realized I would rather work with brokers that are a lot more relaxed and fun in an office and team atmosphere. I've sourced a few deals here and there and have realized that I would rather deal with smaller mom and pops vs institutions for several reasons.

  1. Larger commissions on mom and pop deals vs institutional deals in terms of time spent throughout the transaction process.
  2. Mom and pops and smaller shops are a lot more relaxed and easier to deal with. We tend to have more stress for institutional deals due to variable factors such as keeping updated due diligence throughout the escrow process which can last anywhere from a few months to 6+ months. 
  3. Our middle market brokers all-in commissions are almost x2 more than several of the institutional brokers/teams that we closely work with. Basically, the top middle market brokers that I've seen make a ton of more money than institutional brokers when you compare the hours worked and stress levels.

I'm definitely biased but after being in the industry for several years, you really stop caring about prestige. Not to call WSO out on this but people seem to be way too obsessed with prestige on this site. There are so many roles and positions out there that offer better pay, hours and culture but you just have to find what works best for you. Anyway, this is what I've seen from my industry change over to cre in the past few years.

11mo
surfing pirate, what's your opinion? Comment below:

What product type is your group?

Running your own small/mid sized brokerage it's possible to get into the  $2-5M. $1M is possible after a lot of traction and consistent deal volume as a non-owner broker. I think getting above that requires having other team members to earn revenue off their commissions.

I'm almost certain Vice Chairman's at CBRE hit $1M net for some amount of time and get that title. That should

I'm sure there are a few brokers out there in the world putting up HUGE numbers, but they are far and few between.

  • Analyst 2 in RE - Comm
11mo

There's actually more than you think in top markets that are netting 1-2+ million in fees. I know for a fact that one of my producers will net around 4-5 this year, 4 other others will make over a million, and our 2 youngest should clear a little over 500k. As an analyst this will be a good year for the bonus pool. This has been a stellar year but the top producer on my team pretty much always clears a couple million. 

Learn More

300+ video lessons across 6 modeling courses taught by elite practitioners at the top investment banks and private equity funds -- Excel Modeling -- Financial Statement Modeling -- M&A Modeling -- LBO Modeling -- DCF and Valuation Modeling -- ALL INCLUDED + 2 Huge Bonuses.

Learn more
11mo
Action Jackson III, what's your opinion? Comment below:

I'm not prestige driven, and I didn't even finish my degree. I'm okay with that, because our clients don't ask about our pedigree. They do business with us because they like us, and they trust us. And that's the core of most relationships in this business.

  • Analyst 2 in RE - Comm
11mo

Forsure. Had a bit of time this morning and was just typing this out on my phone on the way to the office but same for us. Our client could care less about our pedigree unless they are extremely stuck up which we know is going to be a headache to deal with. I definitely agree that people do business with our team and brokers because they like us and they know we have a large amount of market share in our city. Crazy to see how sell-side brokers are killing it in the past few years. Out of my team of 15-20 brokers, everyone is making over 6 figures and more than half of the brokers are raking in at least half a million net fees and splits. I'm around senior associate / vp level for the investments/underwriting side but have seriously considered becoming a broker myself. 

  • Analyst 2 in RE - Comm
11mo

I used to be the sole analyst for an institutional group and can confirm it's completely overrated. That team closed a $250M deal this year and their fee was a flat $500k - this was for a new construction, pre-stab sale that took a year + of prospecting during lease-up, a rediculous 100+ page BOV just to compete for the listing, and an exhausting marketing campaign during the peak of COVID.

On the contrary, the middle-market team in the office closed a 20ish unit deal for $5M and charged a 4% gross commission. 1/2 the fee of the $250M deal for 5 - 10% of the work. 

High volume middle market is the place to be.

  • Analyst 2 in RE - Comm
11mo

That's what I've seen as well! I would love to work for an institutional group for maybe a year or so just to see how the head brokers operate but this is 100% spot on. The institutional teams in my office generate roughly half of what the high volume middle market groups do. I'm in no way trying to bash on institutional teams at all but am just showing my viewpoint from the past few years in CRE

11mo
Ricky Sargulesh, what's your opinion? Comment below:

I started at a big institutional IS team, and although I've never worked at a small cap brokerage I have dealt with them as a buyer, and am considering working at one at some point in my career.  My general thoughts are:

Pros: If you don't care about prestige, you can make a ton of money doing a lot of volume in this space.  There's an underserved market for small-cap investment properties that are too small for major brokers and too complicated for realtors, so although you have to work harder to find sellers there's a lot of business to be won out there and you can add a lot of value to the process.  Culture seems generally more relaxed too (brokers will wear sneakers to tours, WFH between tours).

Cons: The process is way less structured dealing with mom & pop buyers/sellers.  Many of them will simply list a property to "test" the market and let it sit forever waiting for some aspirational price and then pull it if they aren't happy, whereas institutional deals almost always get sold once listed and have a set timeline with a call for offers date.  I imagine this can get frustrating, since at the institutional level like 90%+ of listings lead to a closing within 3-6 months,  but in the small cap space its maybe like 20-30%.  I'd also imagine the training is much better at big shops since there's more emphasis on underwriting and they can afford to pay analyst salaries, whereas a lot of smaller shops probably have their young guys dialing for dollars and getting scraps of the commissions.  I think it'd be better to join as an experienced hire once you've been trained elsewhere.

Array
  • 5
11mo
Action Jackson III, what's your opinion? Comment below:

I'm fortunate to have the arrangement that I do with my broker. I don't dial for dollars per se but I have in the past and it was a fortifying experience. Now we are focusing mainly on the usual marketing methods such as mailers & email blasts + social media outlets. I am however craving the contact sport of knocking doors and making those calls. It's a painful experience for 95% of the time but that 5% when a seller agrees to meet is like main lining a fat cup of coffee straight to my brain.

Thanks for your insight, Ricky.

  • Analyst 2 in RE - Comm
11mo

This was a great read and really highlighted the pros and cons of institutional vs mom and pops. It's pretty crazy but the team I'm with is selling around 80-90% of our middle market $1M-$40M deals usually within the first month or two of listing. I believe some of the lead brokers put a good amount of off-market transactions together but we almost never see a deal go through. I'm from a major gateway city so maybe that might be why demand has been so high with low cap deals in the multi family space. I also see smaller funds and large private family offices picking up more multi family assets vs retail/office. Can I ask if you worked in a high COL area or a tier 1 market?

11mo
Ricky Sargulesh, what's your opinion? Comment below:

I've done IS and acquisitions across several markets, but the area I buy my own stuff and deal with small cap brokers/owners is a T2/lower COL city (not NY/SF/LA) where theres a ton of inventory in the <$5mm range.

Array
  • Analyst 2 in RE - Comm
11mo

Debitis debitis placeat tenetur nihil aut ad. Repudiandae recusandae ullam similique ullam facere quaerat et. Et debitis dolores quidem.

Accusamus ab amet dicta quia voluptatum. Provident architecto saepe totam perspiciatis omnis ullam. Ullam omnis illum natus amet dolorum.

Facilis placeat ipsam nobis sunt. Sint amet aperiam praesentium. Iure qui maxime nulla minima sit veniam et. Voluptatem eius dolorem ut numquam aut commodi tempore. Soluta in eos qui mollitia culpa sequi vero. Quidem ut est nulla.

Aut quis maiores sed officia at assumenda ducimus quaerat. Qui quisquam rerum laudantium quia consequatur ratione. Mollitia ex magni reiciendis ea omnis velit sapiente. Aliquid nisi dolores placeat distinctio officia unde possimus natus.

Start Discussion

Career Advancement Opportunities

December 2022 Investment Banking

  • Jefferies & Company (▲08) 99.6%
  • Lincoln International (= =) 99.3%
  • Financial Technology Partners (+ +) 98.9%
  • Evercore (▽01) 98.5%
  • Bank of America Merrill Lynch (▲01) 98.2%

Overall Employee Satisfaction

December 2022 Investment Banking

  • PJT Partners (= =) 99.6%
  • Evercore (▲02) 99.3%
  • Greenhill (▲05) 98.9%
  • Canaccord Genuity (▲15) 98.5%
  • William Blair (= =) 98.1%

Professional Growth Opportunities

December 2022 Investment Banking

  • PwC Corporate Finance (▲14) 99.6%
  • Jefferies & Company (▲05) 99.3%
  • Lincoln International (▲02) 98.9%
  • William Blair (▽02) 98.5%
  • Evercore (▽01) 98.2%

Total Avg Compensation

December 2022 Investment Banking

  • Director/MD (10) $613
  • Vice President (38) $392
  • Associates (220) $255
  • 2nd Year Analyst (139) $163
  • 3rd+ Year Analyst (19) $160
  • 1st Year Analyst (466) $153
  • Intern/Summer Associate (88) $151
  • Intern/Summer Analyst (337) $92