Compensation at real estate family office?

Hi,

Currently a senior IBD analyst recruiting for a real estate asset/property management family office with 10 people and over $5 billion AUM.

They are not an acquisitions shop, they just manage the existing portfolio of properties kinda like portfolio management for the wealthy individual.

How would comp work? And how would it compare to REPE and IBD? What can you expect as a first year associate and later down the line at a place like this?

Thanks

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Comments (12)

  • Investment Analyst in RE - Comm
Feb 29, 2020 - 11:40am

Likely lower pay and hours compared to the other two. Be very careful about making sure the culture is the right fit and that there is room for advancement. Small family offices generally end up on extreme ends of the spectrum, either they treat you like family or you are just the help and they don't care about your future.

Feb 29, 2020 - 9:00pm

Second this. Although I would add that with $5B of aum, they're probably more institutional than your usual family office, and thus pay will be closer to REPE

Array

Mar 1, 2020 - 5:40pm

So, at $5 billion AUM, that is big regardless of category. I think pay should be comparable to role and duties of similar sized firms (RE dept of many insurance firms can be similar and might be good place for comps). In general, RE asst mngt is lower paid that REPE/IB and maybe substantially when bonuses are factored. The trade-off is stability and the likelihood of leaving 5pm or shortly after everyday.

If you get to the negotiating point, aim for higher salary, bonus on performance is probably going to be offered but will be a factor of salary. Without the fees/promote structure of REPE/IB, all pay to you comes from the "family" itself, so think about that and how they want to budget (i.e. tighter band of variance is likely desired)

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Mar 1, 2020 - 7:40pm

I'm surprised they're not doing any acquisitions with $5 billion AUM. I'd be curious to know if that's simply because of where we are in the cycle or if that's their long-term strategy. How do they deal with major capital events if they're not buying anything new? Even the buy and hold forever types usually refinance every ~10 years or so and go buy another building.

  • Analyst 2 in IB - Ind
Mar 2, 2020 - 6:53am

Hi, I was surprised as well however they said the family office was established in order to portfolio monitor and manage the existing portfolio for the wealthy family and currently do not plan on acquiring new assets however I guess things may change in the future.

Mar 2, 2020 - 12:18pm

This likely means the family executes investments themselves and doesn't involve employees in the process.

Array
Mar 4, 2020 - 12:27pm

Working for a real estate development family office. Coming from REPE or banking, I'd imagine the culture would be less intense and you'd work less hours (maybe 45-55). Pay will most likely be less than market, but fluctuates by group. Many of them value personal mentorship more than larger shop, which is good for career growth. One factor I'd pay attention to is advancement opportunities, particularly if there are "family members" at your level. Higher employees could pay more attention to family members and they can have an edge in obtaining promotions.

Others have eluded to this, but the most important factor is the culture of the firm. Family offices each have distinct cultures, make sure you fit in. Typically these groups are less than 25 employees, so if you don't vibe with a couple people on the team, it makes it difficult. If the firm has good deal flow, great culture, and values mentorship, a family office is a great place to work.

  • Associate 2 in RE - Comm
Apr 29, 2021 - 10:06am

Looking at a position within a family office now that is RE based in a major market.

Did you end up taking this position?

  • Associate 1 in IB - Ind
Apr 29, 2021 - 11:54am

completely forgot I made this post over a year ago, I made it through to the final round was confident I would get the offer but then Covid-19 hit hard and their portfolio suffered (they had a lot of exposure to hotels etc) so they cancelled the hiring

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