Long-term comp potential in development?
Hi all,
Curious to get a sense of what compensation is like at more senior levels (beyond associate). In particular, at large development firms, what is the upper comp ceiling? Are MDs making the same/more than those in banking, or does comp cap out at a much lower threshold?
I know there is a lot of variance, but curious if anyone has a general idea of this.
Thanks!
Comp basically doesn't cap out in development. Salaries probably cap out lower but it's all about that sweet promote.
Do you have an idea of what the promote would look like at a large shoot (e.g. Extell, Related)? If a development nets $100m in profit, for example, how does that get split up?
Related pegs you to your project you work on. If your project performs, you get paid. If after 7-10 years your project does terrible, your entire allocation of promote goes down the drain.
Depends on shop - if they offer carry/co-invest you can make WAY more than banking (also some firms that offer weaker co-invest/carry bonus out senior managers super well - I've seen someone get a $1M project-specific bonus in addition to their standard performance bonus while also getting leveraged co-invest in the deals they work on).
As other poster said, salaries and typical bonus cap out lower but the upside is much better.
Thank you!
Echo the above, and it depends. I can speak to my experience in my office, where my MD who gets a significant portion of the promote will make millions in the good years. We're medium sized and have roughly 100 people in the company. Our company and office is unique in the sense we will do deals outside the fund, and some have done very well where my office alone can co-invest, which has made some of the senior members of the team a killing who aren’t offered carry.
At larger company's such as Hines, I've heard they still are generous about giving carry. I know a more senior level person there (family friend), who has worked there for just less than a decade and has done very well for himself, and I know has received massive performance bonuses (at least what I would consider as massive).
Thanks! Out of curiosity what do you define as massive? (Not sure if we’re talking 100k or 1m+)
over a million.
To be fair, if your office has 100+ people, that is huge. There are not many development shops in the country that have staff that size. Unless you're counting construction management, property management, etc in that headcount.
There are literally no development teams that sit in a single office with a headcount that large. Even the behemoths run with a staff of 10-20 actual 'development' roles
Thats the entire company, company wide development team is less than 20. My office alone has 4.
If you start your own firm or become partner of an active shop, it can be in the tens of millions some years. I've seen some massive balance sheets of founders/partners.
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