Commissioned roles worth it?
I'm thinking about a role as a debt broker for better experience because I'm not getting a whole lot of experience with my current role. I've been working for a couple years now in asset management and been trying to break into roles on the development side. I'm thinking that I'm lacking true deal experience that could make me more credible and more appealing to developers? The only thing that concerns me is that it is completely commission and it could be several months or possibly a year until actually closing a deal on my own.
Are commissioned roles worth it for potentially more deal experience?
So, the best jobs in brokerage (leasing, IS, DE) start people with a salary and put them on a team where you work as analyst or "junior" and make your base salary plus a small part of the team's commission. They will work the hell out of you in exchange and train you will. Generally they expect 1 of 3 things to happen by about the end of the third year. One, you graduate to "production" and make more or less commission only (may still have a base "draw" at the big shops); two, you take a job as an analyst with a principal firm (and hopefully you remember where you started and help the team get some listings); or three, you suck and they fire you and you go on to a career in corp fin or whatever.
Those are the good roles in brokerages. The ones that are 100% commission from day one can really really suck. If you are an awesome sales person and know what to do, it could be massively successful, but the firm is putting no investment into you so do not expect much support/training. I'd guess 80% of people who start in roles like that will fail out in first year.
There are "hybrid" where you get the work/team of the first option but because they are small/2nd/3rd tier, they have no money to pay you a base. These are okay if it's all you get offered.
Personally, I would only consider leaving your current role for a job like the one in my first description, anything else could be very sub-optimal for your career. As you may realize, you already have a form of one of those exit ops, so you would be trying to replicate on a better/higher level (on development). It's not a crazy path into development, if you work for the right team/firm, I could see it helping your ability to get a job in a legit development shop (far from only route, including going direct).
Thanks. This is very helpful insight. I'm thinking this shop is probably not best, if they're offering to start me commission only. I think I'll stay put and keep an eye on things with the market for now until something better comes around.
Why not join as an analyst? You start with a salary (can be quite good depending on team/location/etc) and can build experience that way without being on commission. After 2-3 years in that type of seat, you should have a strong CV for development jobs if that's what you're after. Also, an MSRED may help if you don't have one already.
Depends... just depends
Owners and brokers have the highest upside in CRE, period end of story. I left a corporate six figure real estate job almost three years ago and moved into a broker position with no draw, strait commission and 1099. Ill make 5x this year in comparison with what I made in my last yr as a salaried employee. I may not make that same amount of money next year (or ever) and the job is probably more stressful with more highs and lows, but it’s a hell of a lot more exciting and I have the freedom to work on my own schedule. If you’re in a spot in life where you can take some risk and you have an opportunity to move into a decent shop, I say take it. How do you know if it’s a decent shop? Ask what each of the top 3 producers did in gross and net commissions last yr. if they balk at that question, it probably wasn’t much and I would pass.
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