2020 PERE Compensation Report Article
Came across this article that discusses junior pay in the real estate sector. Thought to share it here given that this subject has been getting a lot of airtime on the RE board as of late.
What are your guys' thoughts about the numbers quoted here? At first glance the bonus numbers look pretty heavy as a percentage of base; however, I could just be out of touch with the market. Another observation is that these numbers look to more closely resemble the 2016 Rhodes survey than other surveys like the one the A.CRE guys put together. This survey appears to exclude carry.
https://www.perenews.com/private-real-estate-thro…
The compensation data is broken out about halfway down.
Hmm, doesn't really lend itself to copying/pasting all that well - try this one:
https://infogram.com/1p1jwy22vmqervumvx92pn7mygs63r6pdjl
The PE section looks like its probably heavily skewed towards MF.... I'm in a major city and know for a fact not a single REPE shop here pays nearly what this is quoting.
For what level?
Associate level - our associate level is from like 1-4 years of total experience but never heard of anyone in town paying the median or the high. The "low" for that category is top of market here
I’m assuming you’re talking about associate level, and that’s the only level I could opine on anyway so I’ll go for an explanation.
The associate numbers are for people with about five years of experience. That means they’d be in their second year of being associate at least. I don’t think $250k is particularly high under those circumstances, if you’re in a NY/SF level city. Anecdotally, I’ve heard $300k+ is very common at the associate level at Starwood.
Do all firms like Starwood (I.e. BX, Brookfield, Ares, Oaktree, etc) pay that high for analysts/associates?
Brookfield pays a little lower at $250k (confirmed via a good friend of mine), but the others should be around the same. Keep in mind I’m not going around asking people for comp, so the sample size is pretty limited.
Can confirm the median pay is in-line for VP / Director role for a PERE 30 acquisitions
4.5Y FT. Between median and high for associate level. PERE 50.
The investment manager for acquisitions is in line. But can’t comment on what they consider private equity. Those numbers look extremely high and I imagine it’s the tip top of the market.
Curious what carry would look like for each level. Any ideas?
As a Senior Analyst (3.5 years experience) I don't get a cut of any carry but I get .05% of what is typically a 1% acquisition fee for deals I work on. Typically comes out to an additional ~$25K give or take 10K. Worth noting we're a pretty bottom-heavy shop so everyone's title is sort of a grade below their actual duties. Our Associates act more like VPs and the deal team going to investment committee is typically an Analyst and an Associate. We actually don't even have a VP on the Acq team right now. We aren't looking for one either from what I know. The Associates/Analysts can hold down the deal process just fine and the MDs are basically there for relationships and acting as arbitrators on our Investment Committee. Plus when it comes to capital raising (we're on the GP side) you need at least one or two people who have had a 20+ year career in real estate at blue-chip firms to be taken seriously.
Looks right for NYC or SF/LA for true REPE. Think a lot of people underestimate RE comp because they're working at smaller fee-based shops. As a Senior Analyst I'm basically in-line with the first year associate comp, but my bonus varies wildly. In years we crush it and refi or exit some of our larger deals I might hit the 100% bonus mark but it can also be as low as 25%. I am a bit suprised that MD's are getting $1m bonuses year-in year-out though. I always figured at that level you'd be getting that level of comp but it would be more through carry and less from cash bonus.
What about for secondary cities like Miami, Dallas, Atlanta etc? Anyone have insight?
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