Comments (49)

 
Jan 3, 2021 - 4:55pm

Brokers can earn this much, one I work with will make like 500k this year. I'm sure there are places besides the shops you listed that would pay 300k. Pay in RE is very dependent on whatever shop you're at. Granted, the bigger national/international places will pay more. However, family shops can a lot as well and so can smaller places, but again very shop dependent. I swear this topic has been discussed before, read through the the comp sheet, though you may be disappointed in the numbers you see. I'm sure more than a few people in their mid-late 20's do make 300k+ (they just don't post on wso apparently.) 

 
Jan 3, 2021 - 9:52pm

Many roles pay this. You don't see it on this forum because many of the people who read and write on this forum skew younger. 
If you don't work at the firms mentioned, and want to be on the principal investing side of the business, you will begin to hit $300K all in around 7-10 years in the business. This is about when you will hit VP / Director level roles. Assuming you're at a large institution in NYC/SF or a high cost of living city, it's a fairly quick climb from entry level to $200,000 per year. After that, it levels off quite a bit until the next promotion which you will hit that $300,000. 

 
  • Analyst 2 in IB - Gen
Jan 3, 2021 - 10:00pm

Or you can join a RMBS or CMBS banking team. You're capable of cracking 300k at As1. By As3 you'll def be there, but As1 is doable as well.

 
Jan 5, 2021 - 1:33am

ehh, banking is not the move (been there, done that) - too many jokers at the banks 

Haters gonna hate

 
Jan 4, 2021 - 8:54am

I throw out what has sort of been mentioned above, $300k comes with seniority, so I would say there are two generic "paths" people use to reach this...

1. Seniority/promotion - You get paid more and more due to your skills, leadership, result - i.e. performance gets you there (7-10 yrs+ seems right as people have said, clearly faster in some industries/cities than others)

2. Production - You get paid all or part based on you and your team's production (fees/commissions) - As to when it happens is mix of skill and luck (to be honest), and also likely to require years to get to that level and/or promoted to where you can earn on production. 

As said above, all in 300k in NYC is different than 300K in San Antonio, but still, getting to that level in any city is a function of your own skill, some market luck, and persistence.  

 
  • Analyst 3+ in RE - Comm
Jan 4, 2021 - 9:52am

You really shouldn't worry about it. $225k vs $300k really isn't that much money when you're single in your 20s. I'd take $175k + high probability of moving up within the company at a growing firm versus $250k at Carlyle with 95% chance of being pushed out by VP or earlier.

 

Look at various successful people in their 40s and 50s - yes many of them went to A good school and worked at DLJ real estate. But just as many joined companies before they were big and moved up from within. I think the latter is the most likely (non-entrepreneurial) path to success for those of us that didn't go to Harvard and start out at Goldman REIB.

 
Jan 19, 2021 - 12:36pm

i should correct myself here.  in another thread that is currently near the top, about best jobs in REPE/RE, a poster (who appears to know what he is talking about) reports "200-300" (probably including carry), at Hines, generally for MBAs.  they sound like the only developer who could offer that though.

 
Jan 4, 2021 - 11:38pm

Echoing others, you should be making 300k when you hit VP/Director, so figure 7-10 years depending on how good you are and if you hit a growth cycle correctly.

One thing to note is that at some places, once you reach a specific number (around 300k in my experience) , your pay starts getting split into cash comp and deferred/carry. eg. At a lot of institutions it is hard to get your cash comp too much higher even if your total comp is greater. 

As a point of reference : It took me 8 years of real experience to make 300k+.

 
Jan 5, 2021 - 1:49am

Very helpful guys. Would you generally agree with the below progression (just trying to compare the REPE vs Development comp curves): 

REPE: Can hit 300 by 30 years old. 500 by 35 years old. 

Development: Stay at 150-175 until 30 while you "learn the ropes". 250 by 35 years old. By 40, you're running your own development shop and getting close to $1m/year as you start exiting your own deals. Have your own skillset and make more than the guy in REPE rest of your career.

I guess my point here is - does development comp significant lag REPE comp from ages 22 to 35 ish, until one actually starts developing his own deals and collecting promote, at which point development blows REPE out of the water?

Haters gonna hate

 
Jan 5, 2021 - 10:10am

Serious answer: it depends

You are trying to over-generalize mid to late career comp like you can analyst or associate comp. In reality, a 35-40 year old in this industry could be making $100k or $5MM a year. It is too variable to say "X by Y age."

Commercial Real Estate Developer

 
Most Helpful
Jan 5, 2021 - 10:39am

On the REPE front yes, you're probably correct. On the development front, most people won't face this reality, and I'll get monkey shit for it; but the *majority** of people won't be running their own shop. You can do it at 30-35-45-60. But in reality, it's a whole lot harder than you think. Finding deals is tough. Convincing brokers that you can close when you haven't done it before it tough. Having the balance sheet for the loan is tough. It's not as simple as people make it out to be - Analyst -> learn ropes -> save money -> get promotions -> keep learning -> move up food chain -> go do your own deals. And even for those that do their own deals, most start off with syndication. When you do the math, syndication is a long road to a profitable business. Your acquisition fee gets eaten by the capital you need to invest. So you say, great I'll get Co-GP money - well no Co - GP is giving you money without a track record. If they do give you money, you will be giving up more than a fair share of upside. I've seen this happen and it's worth it to start your track record. But it's a big pill to swallow saying here Co-GP, I did all this work, sourced this deal, underwrote it, I know the business plan, and I put my blood sweat and tears into, but sure - please take 75% of the promote because I need someone to sign on the dotted line of the loan and provide me with credibility to get this deal done and capital raise. Next, on the promote, you don't get your promote until you refi or sell - and there is no guarantee you hit your number. Your asset management fee won't be nearly enough to live on and neither will your property management fee. So you say great, I'll do a heavy value add or a development deal to get a CM fee too. But now you've fee'd out the thing and it's your first deal and your LPs say too much risk. Syndication is a fantastic business, but it takes years to make it profitable and build to hire. It's similar to brokerage in a sense. 
Your first deal capital will probably come from friends and family who believe in you. They don't care about the deal. You tell them they'll make a 15% IRR, they probably think to themselves it'll be great if I make 8% but I don't expect to get my money back. But I believe in this person and what they want and I want to help them get where they are going. That's how friends and family rounds work. 

 
Jan 5, 2021 - 12:50pm

100% agree that raising capital without a track record is tough. My former colleague used to say that "getting people to part with their money is nearly impossible, but not impossible." 

Haters gonna hate

 
Jan 8, 2021 - 12:37pm

Spot on. I know because im the co-GP coming in and stealing that 75% of your promote. Its a great part of the stack to be in but not without risk.

I seem to be a little older than most on here so ill give my perspective. Im 33, senior MD level, $300k would be a bad year for me at this point. My comp is a $175k base, 50%+ bonus and then my carry. It took years to build up the carry and years for the deals to cycle through but now they are and consistently. Im at a REPE family office and i have a better than market carry deal. The only reason i moved over from a $18B REPE shop was because of this carry. The only reason I got the offer is because i worked my way through the ranks in acquisitions and kept proving myself and consistently added outsized value relative to my peers. Long story short, i think there are no shortcuts. Regardless of where you are, keep your head down and work your ass off. Be there early, stay late and get shit done. Also, always be willing to help other people in your shop, not only does it give you a good rep, it allows you to meet other execs you dont get daily exposure to. In my case, it led to my new role and a big raise. Maybe i got lucky, but if you really do these things I think good things will work out for you. Im a big believer that you make your own luck. 

 
Jan 5, 2021 - 11:05am

I guess the "anything is possible" caveat is needed here, and sure somebody will. But with that said...

To suggest that the "career path" of people in development is to running your own deals by 40 and making $1 million per year isn't close to the real experience of the overwhelming vast majority of people in development. 

Frankly, this "REPE" vs "development" (or anything else) debate (WSO fav), misses a pretty large point, getting jobs at these high-yield funds is not easy, supply dwarfs demand by 100x (literally, I bet BX/SW gets 100+ QUALIFIED applicants per analyst/associate spot, plus tons more not qualified). That is why they can work people 80+ hours a week for years (same deal in the IB world), so making double for working double isn't exactly the brilliant move it sounds like (I mean, if you want to make money, it is a trade that can pay off, especially on the "Exit" so I'm suggesting not to pursue it). 

Development by its nature is a far slower business, and while some shops (mainly in NYC) will work associates 80+ hours, I don't think that is the norm. People work in development because it is fun, interesting, and yes can pay pretty well relative to MOST jobs in this world (especially without getting some specialized MD/JD/PHD in STEM fields or whatever). Spoiler alert, most of us who work in development (at least beyond the associate level) are not sitting around thinking about "how to break into REPE", instead we are fielding calls from people in REPE/IB asking "how can I get into development". 

Pay isn't everything, and more importantly, those top paid roles (like the $500k by 35) are not easy to get and frankly getting an analyst/associate role is little guarantee you won't get cut before VP/Director (that part gets omitted a lot on here). So, in general, I get the discussion but it assumes one can just snap their fingers and do which ever they want, clearly that is not the case. 

 

 
Jan 5, 2021 - 11:21am

Love this spot on. When I was an analyst I remembered thinking, I don't get why the senior asset managers don't just go work at a big fund and make double for the same work. And than I grew up and finally realized 1) not everyone can get that job and 2) not everyone wants to work those hours. 
In the end, pay isn't the end all be all. Personally, as I've moved up the food chain, I've realize I have zero desire to work stupid hours. If it were for my own business, sure. But for someone else's, nope. I love my life outside work and would rather make less money and stress to be home for dinner every night. Have plans on a weekend that I can commit to. Go away with my friends. I love working, but I love my family and activities outside work more. I think it doesn't dawn on most 22 year olds. But as you get a little older, 30ish, you begin to rethink your priorities. When job hunting, I personally screen for culture the most - do you work 24/7 and think that's all there is to life? Some people love this - personally not for me. I think people need to begin thinking about what they really want - money is great - but most people can't do 80 hour weeks for more than 2 years. Personally, I believe 60 hours per week is the top you can work consistently without burning out and still producing good and accurate work. 

 
Jan 5, 2021 - 12:46pm

Spoiler alert, most of us who work in development (at least beyond the associate level) are not sitting around thinking about "how to break into REPE", instead we are fielding calls from people in REPE/IB asking "how can I get into development. 

That's really helpful to know. Why do you think that is?

 

Haters gonna hate

 
Jan 5, 2021 - 1:01pm

Let me provide a little more color on why I'm asking this question. I'm 29 yrs old, just finished at a REPE megafund (one of the names above), and am pretty lost. My life has been somewhat of a proven track until now (Top IB-> Top REPE). But, I digress. In my models, the IRR/MOIC of the development partners is always much higher than the LP's, so I was thinking I should further explore development. Yes, money matters to me. But I am at the point where I am willing to take a cut to achieve my goal: my main goal in my 30s is to acquire a hard skillset for myself so that I can work for myself by 40. I am at the point where I no longer am simply "chasing the money" but really want to build a long-term skillset for myself. I would humbly consider myself slightly more entrepreneurial/enterprising than my co-workers at my previous firms, if that matters. Would you agree that working at a GP (developer, value-add multifamily shop) is a better way towards that end as opposed to being an LP (where you're just involved in the financing and somewhat removed from "the action")?

 

Really appreciate the help here as I think through this. I want to be very thoughtful about what I do next and make sure my next role is moving me closer to my goal of working for myself by 40. I am willing to put in the work to make this happen.

Haters gonna hate

 
Jan 5, 2021 - 2:40pm

Yes - working for a small shop / GP / Developer is the way to go if you want to do your own deals some day. Both ways can be done. With that said, at the smaller shop you will be in the nitty gritty of every deal that the LP isn't. You will learn how to actually operate the asset, how the business plan really implements, and when you are underwriting, what is actually going to happen when you begin raising rents. The small shops will give you more exposure to the entire process. The big shops will give you more stability and credibility. It is a mixed bag honestly, in terms of raising capital, but the credibility is the big issue. I personally have the personality for corporate, and would do better in a corporate role (and have done much better in my corporate roles over entrepreneurial) but you just learn more in a small shop because you get to 'touch more.' This will also set you up with a 'hard' skillset as you will actually know how the thing (building) operates and what buttons you can press. In my humble opinion, you don't learn this at an LP, even if you do asset management.

 
Jan 5, 2021 - 7:46pm

I'd guess I'd say yes to your proposition, at least generically plausible. Still, "doing own deals" in real estate is generally of being able to raise/attract capital and negotiate deals, that really comes down to sales ability at its core. So, trying to find a "job" that prepares you for all that, is probably easier said than done. My observations of people who successful started their own venture were usually pretty senior people, had prior executive experience (like at a development and/or investment mgnt firm), OR came from brokerage/I-banking sales world. 

 

 
Jan 6, 2021 - 12:23am

For those of you who eventually want to go out on your own, would you only want to start your own shop in order to develop, or would you leave your corporate jobs if it just meant buying and holding assets (be they core, value-add, or opportunistic)?

 
Jan 6, 2021 - 8:51am

For me, buy and hold / value add. I don't like development. In my humble opinion, I don't think the extra risk you take is worth the extra 200-300 bps you make on the deal from an IRR perspective. I've worked at a firm that had a large construction and bridge lending platform and I've seen way too many developers completely blow their targets. They don't necessarily loose money, but they don't much make either. I'll add, these were institutional developers. Keep in mind, with current valuations there is a reason many developers began construction loan funds - when you lever up your loan position, your return is safer (technically) and a higher risk adjusted return. 
I've also worked for an opportunistic equity fund targeting high teens returns. It felt akin to VC investing - if a deal in the market could hit our returns - we basically had to try to win the deal. It was much less about is this a good deal, do we like the real estate and the location, but more about "oh hey, this can hit our returns. It's the only building we've seen this month that can potentially do it - we need to win the deal." Basically, this is what happens when you have a fund that has to put equity out and the deal targets are slim picking. 
I think a major question people forget to ask is: "Your targeted return (IRR) is 18%-20%, but do you ever actually hit it?" Everyone asks "what return do you want and what return do you need?" - to their investors. And many people want and say they need that high high return. But they forget the question - does the operator they are speaking with ever hit it? And the answer the majority of the time - a resounding no. 
 

I like buy and hold / value add because you have more deal targets to choose from and are more likely to hit your returns. You are looking for singles and doubles. And if you have a long time horizon, you can buy quality real estate and hold it forever. Sure, flipping you make a profit quickly. But you create wealth in real estate by holding for 30 + years. 
 

With all this said, the above is my opinion and my investing style. I am extremely conservative. I also feel I'm a realist. People may disagree with me and have other experiences. I 100% could be wrong but this is where I like to invest. 

 
  • Analyst 1 in RE - Comm
Jan 11, 2021 - 7:19pm

Head Analyst on my Middle Market IS team in NYC was 29/30 and brought in $300k+ in 2019. Can be even more with institutional groups. 

 
Jan 11, 2021 - 8:00pm

 

Head Analyst on my Middle Market IS team in NYC was 29/30 and brought in $300k+ in 2019. Can be even more with institutional groups. 

i believe you but this is not an 'analyst' role for someone with 0, 12, or 24 months experience following graduation 

 
  • Analyst 1 in RE - Comm
Jan 26, 2021 - 11:33pm

Yeah should have specified, this guy was 8 years out of college and had a VP title. 

 
  • VP in RE - Comm
Jan 12, 2021 - 6:38pm

What sucks about this whole thread is that my wife is in a medical profession. Late 20s. She got into in state med school, so debt load is all in less than $150k. She has begun applying for jobs. Already has three offers, lowest one is paying $200k base plus a bonus on top for fee for service medical treatment. Pay will get to about $350k or so in an average cost of living environment, when she hits mid 30s. Also her hours are reasonable too, most weekends off, weekdays are 9 hour shifts.

My biggest thing is, we talk about busting our ass and eventually get to a $300k pay maybe in our 40s. I know the whole logic for almost all of us is the progression. Our justification for being in this industry is that we want to earn the millions, but the reality is that very few do. The same logic applies to the medical profession, there will always be the top notch millionaire docs (oncology, heart surgeons). Its very hard to make it in this industry and maybe its Covid being a buzzkill, but we all have dreams of either starting our own shop or retiring with a large portfolio of RE. The reality is that it is super hard. My wish is that we can all can achieve our dreams, but unlikely to happen. Funny how we start out thinking in college, that we will be billionaires, but then when we start working, we'll take a $300k salary by age 50.

 
Jan 12, 2021 - 7:28pm

I don't see much of an arbitrage, or disproportionate pricing, between docs and RE investors here if that's what you're getting at. Also super hard to grind thru and be a doctor. Esp these days with covid. They're fucking heroes as far as I'm concerned. You don't get into medicine to get rich, you'll flame out. Plenty of people get into RE and business in general for the money because that's pretty much what it's all about.

I appreciate your last point though - hard to make a lot of $ no matter how you slice it. In RE, even if you don't become an entrepreneur and instead end up in a senior role at an investor/lender, the higher you go, the more your comp is tied to performance and is more "eat what you kill". Cause after all, what else is there to eat? That's how the firm makes money so that's how you make money, period. So just grinding won't do it. Investing also takes lots of luck. 

 
Jan 12, 2021 - 7:59pm

i doubt the guy who makes "maybe 300 by 50" is TRULY "busting his ass" as you say, in the way that a licensed MD has busted his ass or a career i-banker in NY has busted his ass.  a typical real estate track is not as hard as those things.  

 
Jan 13, 2021 - 12:47pm

 Our justification for being in this industry is that we want to earn the millions, but the reality is that very few do. The reality is that it is super hard. My wish is that we can all can achieve our dreams, but unlikely to happen. Funny how we start out thinking in college, that we will be billionaires, but then when we start working, we'll take a $300k salary by age 50.

I appreciate the honesty of your comment, and I suspect a lot of people in this industry (and a lot others frankly) feel similar at various points in their careers. Still, my gut reaction is somewhat the opposite. I got into this industry because it seemed super interesting, exciting, and even meaningful. Watching cities develop, properties be designed, and deals/transactions for space and investments come together was just super cool. I wanted to learn and do everything. 

The fact that it can pay well (I mean super well) clearly was motivating factor, and pay has certainly directly career choices I have made and probably will continue to be factor in the future. BUT, I can't say I do what I do for the pay alone, and I can absolutely say I was not seeking out the route to the largest salaries and profit payouts at any point. I've come up along side the hardcore, high-finance world (real estate private equity funds and non-trade REITs) at the high level as a consultant. I've had many opportunities (some seriously considered) to jump full in to that world and suspect I would or could be making more than I am today had I done so (at least some potential for bonus/profit shares in the short-term). At end of the day, the pure finance world just seemed boring AF (personal take). 

I have zero regret, in fact, I am really thankful I didn't succumb to the chase pure money urges. And frankly, I think most of my peers (I'm late 30s) who have now been in this industry 15+ years mostly feel the same I think. My peer circle in finance seems more envious of people in real estate than vice versa (this may be very biased). I actually like what I do, and feel most people in my firm and industry do as well. Sure there good days and bad days, but I know I am not looking to trade. 

Of course, depending on your willingness to take risks (that includes getting advanced degrees and/or moving markets for job ops), I don't think making "all in" compensation north of $300k is all that hard on a relative basis. Have no idea on percentages, and of course varies by market/field/role, but I'd venture a guess that many people in this industry will reach that threshold somewhere in the 15-20 year total career time mark (so could be mid thirties for some). Those in brokerage/fee/commissioned base can get there faster (with some luck) but with less guarantee, those with more "corporate" jobs need to get promoted, take advanced/specialized roles, and/or bank on good bonus and participation type payouts quite often. 

So, on net, I think this industry is pretty awesome to present this much opportunity to so many and really be a lot of fun along the way. Clearly, it's not for everyone (and I sincerely am super happy people like your wife exist and do what they do!!), but it's all perspective. If you think you were destiny bound to make $1mm by age 30 (like the talk of the WSO IB forum), and you only make $150-200k or less, I guess you could feel pretty disappointed. On the other hand, if you think about classmates making $100k in some corp finance role at random firm XYZ filing TPS reports everyday and god knows what else, you might consider yourself pretty lucky/well off. 

To each there own, life if full of trade-offs, I'd rather enjoy my job than anything else! (NOTE... I think those who really enjoy it, and become really good at it, will get paid the most in the long-run)

 
Jan 13, 2021 - 2:56pm

Commercial Real Estate Developer

Start Discussion

Popular Content See all

IB Sucks. I'm out
+183IBby 1st Year Analyst in Investment Banking - Generalist">Analyst 1 in IB - Gen
IB is not intellectually challenging
+68IBby Intern in Investment Banking - Mergers and Acquisitions">Intern in IB-M&A
VP Lying
+28IBby Prospective Monkey in Investment Banking - Mergers and Acquisitions">Prospect in IB-M&A

Total Avg Compensation

January 2021 Investment Banking

  • Director/MD (9) $911
  • Vice President (31) $349
  • Associates (142) $232
  • 2nd Year Analyst (89) $151
  • 3rd+ Year Analyst (20) $148
  • Intern/Summer Associate (91) $144
  • 1st Year Analyst (352) $132
  • Intern/Summer Analyst (300) $82

Leaderboard See all

1
LonLonMilk's picture
LonLonMilk
98.5
2
Jamoldo's picture
Jamoldo
98.4
3
Secyh62's picture
Secyh62
98.3
4
CompBanker's picture
CompBanker
97.9
5
redever's picture
redever
97.8
6
frgna's picture
frgna
97.6
7
Addinator's picture
Addinator
97.6
8
bolo up's picture
bolo up
97.5
9
Edifice's picture
Edifice
97.5
10
NuckFuts's picture
NuckFuts
97.5