VP/Director Level Comp in Real Estate
There is a good amount of posts for Analyst/Associate level comps here on WSO. I’m interested in seeing what VP/Director level comps look like…especially on the acquisitions side. I know the market has been tough for transaction roles, but wanted to get a sense of where market comp is at…
NYC cash comp that I’ve seen ranges from 400-600k all in. Usually some sort of carry as well.
This is what I have seen. I have a couple of data points. All in the range (inclusive of long term incentives).
Is that for real estate or NYC in general? Asset type?How many years of experience? What about younger, more recently promoted VPs.
I usually see a ceiling of $300k plus ~$100k either through carry or company stock. Not many positions short of CIO exceed that. NYC is the one exception that could be higher.
This.
This is untrue. I've recruited for VP positions in LA, Denver and Texas and almost all of them pay over $300k in cash comp + carry on top of it. I'd say probably 50% of them pay $400k or higher + promote for someone with 7-10 years of experience.
Ya, I thought about this more after I posted and $300k was really a 2020 figure so I assume there’s been decent wage inflation. $400k today would make sense, especially if zero experience is getting you $125-$150k.
I’ve seen it kind of two levels cash comp around $300k - $350k then another level around $500k - $600k. This is for non-NYC. And role would be a deal person running a region as an acquisition person.
I have posted here before but I’m at $550k cash comp with promote being another $500k - $1m per year depending on returns but was at $450k last year and $375k year before. 11 YOE. Similar role / responsibility mentioned above.
Are you at a mega fund or small/mid size shop? I’d love to get to your level one day. I’m at 6YOE, getting paid slightly higher than assoc level. As I’m looking out for opportunities, I’ve been hearing quotes like $165-250k base, anywhere between 15-30% bonus with or without carry depending on the shop. Seems like it’s a little shy than the first category you mentioned.
I have a “Director” title but work in strategy/research not acquisitions, have 8 years of experience.
i have a base of $200k, with a 40% bonus.
Could you walk through how you're receiving meaningful promote checks on an annual basis if you're working at a fund? I'd imagine that most funds pay the lion's share of their promote once the fund is closed / all assets are exited (unless you're hitting such high returns that you're already in the money well before exiting everything), and I'd imagine there's a typical fund close every 2 - 4 years at most places. What am I missing here?
They are paid out every 3 years but I annualized it to give some sort of context on a per year basis. But basically my expectation is to get paid $3.5m - $5m the next 5 - 6 years
What is your day to day and how long have you been in that role? Not a megafund. Our AUM is roughly $5B currently deploying $1B+ fund. Not sure how’d you describe that size.
Overseeing a handful of sunbelt states. Lean team, smaller shop. Been with the shop from right out of school and went the analyst>assoc>sr assoc>vp route when it was actively deploying, then things really slowed down, not pencils down but doing lots of AM rn for sure and deals here and there inconsistently ever since getting promoted.
Mind sharing what you mean by "slightly higher than associate" in terms of comp? Currently a 3rd year associate so curious.
What market are you sitting in? NYC or?
Once you're at that level, there's a good chance you're getting salary + large bonus + meaningful carry. How these mix and shake out can vary drastically by the type of place you're at.
If you want to know NYC, I'd just look at the Rhodes Associates report as that is largely made up of NYC comps.
Outside of NYC, I'd say it generally breaks down as follows, though it's going depend on location, strategy, product type, etc. I'm assuming this is for a standard VP level around that 8 - 9 years of experience mark.
REPE Fund / Debt Fund - These are always going to pay the most cash comp on a stable basis since they have more steady fees rolling in. I'd say most typical is $300k - $400k in cash comp, usually split about 50/50 between salary and bonus. Anything under $250k and I'm calling you too underpaid regardless of your market. Anything over $450k - $500k and you can consider yourself crushing it if that's on a steady basis (I think a lot of people may have made big bonuses getting them over $500k in 2021 with that insane transaction volume, but that won't continue). Your carry here should likely equate to another $150k - $200k a year on average if your fund's returns are hitting their base case scenario, though most of this is probably paid out in chunks which you likely might not start to see for at least a couple years.
Local Operator / Developer - These are harder to pinpoint. More often than not, you're going to get a much more significant piece of carry that's paid out on a deal-by-deal basis (which is much better than how it's paid on a fund since you can hit a home run on one deal and flop on the next deal and still walk away with a big check). I'd say generally, you're looking anywhere from $125k - $200k salary for most people. Bonuses here are the tough part, and are likely dependent on how much carry you're getting. Some places will give you a 25 - 30% bonus even at this level but give you a large enough % of carry that it will trump your cash comp just on a base case scenario with the ability to make you do cart wheels if things really go well, though that also means that you could walk away with nothing during rough times. I know a few people that made $1M - $3M checks this way when they were 28 - 32 years old, but most of that happened around 2021 with the insane market we had but now some of them are back to making $200k all-in and hoping that they can at least scrape together a new deal or two this year so they don't lose their job. The name of the game working for a local operator / developer is to consider what you could be making in a more typical REPE / debt fund setting but know that these firms typically don't have the balance sheet to compete on their cash comp, so take into account the trade-offs and benefits here to come to a package that you're happy with (working for these companies is typically a better lifestyle and a bit more fun as you're a bigger fish in a smaller pond and have much more control of your time and success, but you're going to trade off surety in near-term cash comp in exchange for potential making a huge upside if things go well). When you go into the other thread of people complaining about not getting bonuses this year, I bet you they almost all fall into this category of company, but nearly all of the people my age I'm most jealous of due to the amount of money they made in 2019 - 2021 also fall into this category. When you here about folks that made huge bonuses that fall into this category, it's usually because their bonuses are explicitly tied to the amount of deals they closed that year or the amount of acquisition fees their deals brought in, so in insane years they can still hit big cash bonuses.
I really don't have a go sense of what VP level comp is on the lending side outside of debt funds, but I know they're generally a bit lower on cash comp compared to REPE/debt funds and don't have nearly the upside, but they offer a lot more stability and a lot better chance of working 30 - 40 hours a week on average.
Final point to make is that there is an insane depth when it comes to the different types of CRE companies / opportunities. So what I'm saying above fits towards the middle of the bell curve that applies to most of the places we are all working for, but you'll come across plenty of opportunities that may fall well outside of these parameters and it's up to you to decide if it's worthwhile due to the circumstances. Maybe you're becoming the #2 to a young developer that's starting to crush it and he's hardly going to pay you cash comp but you decide it's worth it because you have faith in this guy and know you're going to be the first partner of a successful endeavor once things start to take off. You may find a company that has an excellent founder that just raised their first fund and it's too small for them to pay you $350k - $400k a year in cash comp, but you know that if things go well they'll eventually triple the size of their fund and you'll have an MD position waiting for you. Or maybe you'd just rather work 80 hours a week the rest of your life at Blackstone to be making some seriously big cash comp checks. There's all sizes and flavors to this game.
Wow, this is the most detailed and helpful response I’ve seen, thank you for all the insights. The shop I’m at definitely falls into the small balance sheet category. Bonus definitely was wiped last year and so is a good chuck of promote. I’m not complaining, the business is cyclical by nature, and it's all part of the career. But it's great to hear what’s out there, definitely brings some silver lining to fight another day until things get better.
I mentioned the outsized pay days some people got on the operator/developer side. If those pay days were so easy to get without downside, then everyone would just fight for those positions. Those types of pay days come with a big risk involved and plenty of people that work for them end up making significantly less money than if they just worked for a fund. I think it's super important to choose these operators/developers wisely when you're joining even if it's at the associate level, especially since they often hire at the associate position (not analyst since they don't have the infrastructure to do the training) and then promote within. Not to say you can't join one at a VP level since I also see that all the time, but man one of the best things that can happen to your career is choosing the right one of these teams to join as an associate and working your way up into a principal position with them as they grow.
Just want to echo, insanely helpful post.
Evaluating a local dev role and what you described is effectively the exact set up I’d have... so very helpful to hear that’s how it works. Feels tough to give up the guaranteed cash comp today, but when I look at the underwriting on the deals, potential carry (albeit much riskier) and improved lifestyle flexibility… it’s a risk worth taking at my age / stage of career.
I'm early in my career, at a GP - I don't see a future where i am making decent comp in the next 2-3 years.
Should i jump ship to a LP?
Never make a choice in your CRE career based on how much money you're going to make in your early years
Any idea of the comp range for a VP/Director on an institutional D/E + sales teams? Obviously is very team performance dependent.
You're on commission at that point. Comp is up to you.
there is thread for JLL director comps
Texas
~$375K cash comp
~$200K year in carry
10 YoE
50ish hours a week on average
I’m at $225K base + 70% bonus with 10 YOE. I’m a SVP at a top 50 pere shop but a relatively new vertical that launched a few years ago so doesn’t have the huge profitability and fund vintage that other groups have. I def feel undercomped by 75-125K per year but I bought into the dream of building something significant. Major East coast metro not nyc.
Any reference points for capital markets? Specifically, internal capital markets that sources leverage for company's own CRE debt / equity investments? (not a brokerage) and in NYC/HCOL. AUM ~$35bn AUM.
I would say that the comments above are accurate re: outside NYC, and agree on the two levels. I think the the distinction is more about experience since titles are ambiguous in CRE. Note this is for large funds/investment mandates and these are "target" numbers. If they're looking for significant experience prior to the role, then it's $500k+ all in cash (so before carry). If it's someone with good, but maybe senior associate experience, then it's $300-450k depending on location. It's always funny on these threads since bonus can vary so much. Someone might have pulled down $600k in '21, but they've been looking at less than $400k total cash comp in the last two years (or worse depending on product type). That's sort of just how the market goes. Nothing is linear.
In the case of a local/boutique developer, what’s a typical share of promote (assuming you’re taking on a lower base)?
Also wondering this^ so far have been framing it as what are the $ I need in 5-7 years that would leave me roughly equal with my current and more transparent pay trajectory.
I'm in Texas and have 10 YOE. Work for a fund on acquisitions team. Salary $225k, 100% bonus, and promote worth about $200k per year on the base case on an annualized basis but the first fund I participate in won't pay out for a few years (if at all).
13 YOE - West Coast - REPE Fund - $700k - $750k Cash Comp + 2% in fund
13 YOE - West Coast - REPE Fund - $700k - $750k Cash Comp + 2% in fund
Congrats! Any color you’re able to offer on wlb, trajectory, etc.? Early in my career and trying to map out paths of success in order to make better career decisions
I would say typically in the office from 8:30 - 6 pm and answering emails at home when not in the office with the occasional work on the weekend for a few hours to catch up. Also traveling almost every week for 1-2 days. But I enjoy my job / work I would do it for way less than what they pay me.
For trajectory I mean when I started my first job paid me like $75k. RE has definitely seen major changes in terms of compensation over the years. I’ve been on the principal side the entire time starting off in LP equity before moving to a fund operator. I would say work hard be curious and don’t be afraid to ask questions. The RE business isn’t rocket science and a good mix of understanding finance / social skills / hard work can go a long ways. I do think it is way more competitive today than it was when I started and it feels like there’s a large gap missing between the ages of 50 - 60 year old folks because of the GFC leading to many c-suite folks being younger and not moving out of their jobs soon which can make it tough to move up.
Compensation for a VP or Director in real estate can vary significantly.
It depends on the city, company, and type of property. In major cities, compensation can range from $150,000 to $300,000 or more, including bonuses and other benefits.
To earn more, work on more deals, meet more people, and learn about buildings that are in demand.
Some jobs give extra money if you do well or own part of the deal.
Review your job offers, car, and consider how they can contribute to your future growth.
I’m starting to feel underpaid. Guess it’s is easier to pay people out of fees you collect than out of your own pocket at a family office.
I’ve been circulating the idea of bringing on outside investors for some of our deals and collecting fee based income. But the current generation in charge has more money than time and can’t comprehend the idea of reporting to outside investors.
Are others promotes here a % of GP's promote or deal promote?
What's the difference? Doesn't like 80% of the deal promote go to GP with 20% going to outside investors who gave them the GP slug?
This is a very important distinction. I was previously part of a company that gave me a % of the company’s promote. Well low and behold when we capitalized a deal, the firm was only 50% of the GP capital (and had a 50% interest in promote entity) . 50% of the GP and promote were sidecar investors….the largest one being the company’s founder and his family. The acquisitions staff were getting diluted from our promote by our company’s CEO.
Some people in RE are shitty...
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