Currently a Senior Associate at a Big 4 Transaction Real Estate group in Philly area. Secured an offer for an Associate role in Asset Management. Salary would decrease by ~10% and all in comp could fall ~15% in the first year. Would also require a commute whereas before the office was located in the city.
I do not know how much longer I will be able to make a move like this to industry from the Big 4 role. Should I really expect my "hourly" salary to increase because I will be escaping busy seasons? Is the trajectory for comp and exposure greater? Any advice from anyone in either role?
How much do you make rn at the big 4? Salary and bonus.
This is super personal, you are essentially "jumping" and to get in to the "mega fund" world you are clearly being asked to "restart" and the paycut. Should you?? Up to you, but I'll over two ways to think about it.
1. Net Present Value - Estimate your "lifetime" earnings for both careers, and discount back. This "decrease" could (well should) be made up for in years 5+
2. Ignore sunk costs - This is more "lofty" but pretend you didn't have this current job, would you accept this other? Next step, let's say you are at MF, would you apply for the sr. associate role at the big 4 transaction re group and take it? (i.e. would you come to WSO and ask... "Should I leave my associate role in AM at MF for Sr. Assoc. role at Big 4 for 10% base bump and 15% up overall?").
Personally, I'd advise thinking very long-term on this one. What ever you pick, just make sure you won't regret it. I call these "take the risk, or lose the chance" moments. I've had them myself. Each time I "took the risk" it massively paid off with the benefit of hindsight (even if some short-term pain).
Listen to this guy ^ No risk no reward.
I appreciate this response and the way of thinking. I think your answer will help get me where I need to be, but I wanted to note I should have said multifamily asset management instead of "MF". The company has over $5bn AUM, so they are not massive/mega but not terribly small either.
Given the new role is in the industry and outside of professional services, it would have a better alignment with my long term career goals.
Got it, noting MF as multifamily doesn't change any part of my suggestion, do what you think makes you happiest long-term!
Forgive my ignorance, but how does a Big 4 Transaction RE Group have a busy season? Thought that only applied to Audit?
What have exits been like from your team in the past? I would use that as a benchmark to help assess whether you should take it or could do better. Not sure if the Big 4 RE teams are better in the US, but I haven’t been impressed by the teams I’ve dealt with in Europe. I’d take the AM opportunity to get a much better nuts and bolts knowledge set. You could then use this experience with your Big 4 transaction experience to position yourself for an acquisitions role if that’s where you ultimately want to end up, but you may find yourself in the same situation where you need to lateral across to a slightly lower position and it may need to be to a smaller fund.
Not an ignorance at all, it's a unique situation. Part of the work stream is what we'd call "audit-assist" where we're working with the Audit teams to verify financial models for RE funds. The Audit teams don't have the expertise to get comfortable with the values the clients are booking, so the RE team serves as a specialist to the auditor. As such, we inherently get a large uptick in workload on top of our non-audit strategic work during December - April. It slows down in the summer after that, so it's virtually 60% tied to that piece and 40% tied to other work, which is typically in some kind of financial statement reporting capacity.
Other members of my team have exited to do acquisitions, AM, development etc. The comp I am being offered could potentially be better, but I am fearful that the hiring cycle will run dry by the time busy season ends in April. For reference, however, virtually my entire starting class nationally in the RE group have since left for similar roles at funds of various sizes and we joined just a few years ago. The role I have in front of me as you said would give me a much more defining knowledge of the business. I am not married to AM or Acquisitions, but I would agree that no matter what the longer I wait the larger the spread might be as I have to make a lateral move to get my foot in the door. Perhaps the sooner the better is the way to go. Hope that helps.
Recently made a jump from one of these advisory groups into REPE (AM/acq hybrid). In my case, comp went up significantly, and frankly, given B4 pay, I think you should be able to secure another opportunity that results in a nominal pay raise, at minimum.
That being said, if you are genuinely concerned that you may not be able to secure another offer on the principal side, I’d say it’s worth taking this role despite a pay cut. The skills and thought process you will develop in the AM role will be far superior to the one developed in a B4 advisory group.
Feel free to PM me if you want to chat more.
Aside from their Audit teams, I never understood was these Big 4 RE teams do. Valuation and Advisory for what exactly? I just looked up some available EY RE roles in Transactions and Advisory and it states raising debt and equity capital for clients. I didn’t know they do this. I have seen tons of people transition to acquisitions or AM roles from them.
I’m on the Principal side and we have hired advisors for raising capital but it’s always been the likes of the D/E teams at a broker shop like JLL, Eastdil, etc.
I guess they mostly advice non-RE firms like Google.etc. on their real estate holdings. But yes it's kinda weird. Big 4 should focus on auditing and tax lol.
Not sure if applies globally, but Deloitte in Europe seem to be growing their RE teams in some of their corporate finance groups significantly. Have seen them on a lot of capital raisings and corporate advisory mandates. In some markets (Belgium for example), they seem to be trying to compete with the brokerages on more traditional acquisition / disposal mandates. Whenever I’ve dealt with them, I haven’t been overly impressed. Their understanding of RE is noticeably less than the brokerages given they’re generally a corporate focused firm and can’t leverage the wider industry specific knowledge the brokerages have.
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