REPE to Developer Comp Adjustment
Considering moving to the developer side from REPE... offered $125k plus 15% vs current comp of $120k plus 50%. Feel like that's a pretty big step back. What would you do? It's a small, newer shop with only about 8 employees.
I mean based on just the comp then yes you would financially be worse off. But if you are more interested in real estate development, then it could lead to much higher comp in the future if you are much better at and enjoy your job. So it begs the question, why do you want to move to development?
That's fair. I do want to move over to the operator/developer side of the table. I guess I'm just hung up on whether I should wait for an opportunity with more stomach-able comp, or if this is pretty fair.
How many years of experience are you in RE? If you're currently a senior analyst/associate at REPE, then I'd say it's pretty fair since you are still junior and don't have much dev experience. Also don't forget that this is a smaller shop too. If you want higher pay, a larger dev shop would be a better bet.
Associate with 3.5 YEO in RE with finance exp 2 years before.
I don't think it's far off esp from a smaller shop. Maybe you could get a bit more from a larger shop, but I don't think it's going to be anything to write home about. I've been out of corporate for a couple years, so perhaps other monkeys will have more accurate figures. However, I will say that if you think you are definitely interested in development and see yourself there long term, then it is probably better to make the move sooner rather than later. Right now the cost for you to switch is ~$50k, which is a decent amount for someone in their 20's/early 30's, but in the grand scheme of an entire career really isn't that much. However, if you wait until later and perhaps make VP in REPE and then switch, your opportunity cost is significantly higher because you'd be going from VP in REPE to associate/senior associate in dev. Whereas now you are just going from senior associate to associate. Furthermore, you can start building your knowledge and career in development right now, which will hopefully allow you to make dev manager/VP sooner rather than later.
It's tough to negotiate when your REPE comp package was under market. I'm an Associate with just north of 4 YOE - all-in 2024 comp came out to $300K in NYC... in a down year
So here's my two cents. I made the switch later in my career. Your cash comp in a development shop will never look like your comp in REPE. You need to better understand at which point will you start to receive carry. That's the driver in development. My salary was basically cut in half to start, but between a bonus that has been 2-3x my salary in good years and promote, I have made far more money on the developer side than I would have in REPE (and my job is way better). You eat what you kill in development. In good times, the compensation can be significant. In lean years, it sucks. You don't have that same volatility on the REPE side.
Appreciate the reply. Are you happy with your transition? Do you have any thoughts on joining a newer/very junior developer?
I've liked it. I have a tremendous amount of autonomy and can work on the things I find interesting. My role is unique in that way. There is a lot of work and stress involved with that, but I don't mind it. Joining a newer / very junior developer is a high risk / high reward move. If they are successful and you are an early employee, there are outsized opportunities for you there. But when a group is new, things can get lean fast. Question to you is: what are they developing and are they getting things done right now? This is an extremely challenging time to be a developer.
In addition to what others have said - I'd just say that your market value should be lower. You are going from something you are experienced in (REPE) to a new department that you are less experienced in (development). While parts of your skillset will obviously carry over, I wouldn't expect my market value to be the same
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