Development vs. REPE pay gap
I am in development and intend to stay within it. I have been in talks with an dev LP REPE firm (huge name ) and the comp is so much higher than what I make now (about double)
I don’t want to leave development, but curious, when does development catch up/ start to pay off. I know it monetizes much later on and Is always all deal economics dependent … but when did you feel it caught up
I am trying to keep my eye on the prize, lol.
Is your current company a "huge name" in development? I'd imagine firm size discrepancies being a bigger factor in W2 pay than some broader Development vs. REPE trends.
Try not to think about "playing catchup." If money is all that matters, there are better options than either. As always, development makes real money when you're doing your own deals or you're a MD or above at a big shop.
Current firm is big Multifamily REIT, equally capitalized.
Makes sense,yet put my head down for a while to earn those economics.
If you're at a REIT doing development, I would seriously consider the offer. There is still upside at senior levels but it's going to come in the form of stock vs. true deal equity participation. RSUs are less tax efficient and require vesting, and meaningful participation is going to be reserved for pretty senior levels.
I agree with this. Also at a public REIT, management is constantly fighting with the stock analysts about reducing development pipeline to less than 20% of the market cap. Therefore, there will be a ceiling on the size of the development arm (you move up due to someone else retiring vs the business growing).
The possible exception is if your REIT has a history of promoting from within, and they’ve made someone from development the CEO (and then promoting other development folks up). I’ve seen that happen, say at Alexander & Baldwin before they were taken private by BX.
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