As a new broker undergoing training (CBRE/JLL/CW), how difficult was it to maintain a stable source of income? Some topics/questions I have are:
(1) Did you have a draw or base?
(2) Prior experience in finance or RE?
(3) How long till you were put on a team?
(4) Commission and transaction volume?
(5) Work hours and type of work?
Any general comments/info on the topic would be greatly appreciated! Thanks.
| +82 | LP coming into deal at higher land basis. How to model returns to GP? | 19 | 2h | |
| +76 | Increasing RE Industry's Cash Compensation, Collectively | 43 | 1d | |
| +73 | Major Decisions | 13 | 2d | |
| +33 | Niche down to an operator or stay an allocator | 11 | 4s | |
| +32 | Being asked to stay behind and train my replacement | 7 | 52m | |
| +24 | Breaking into CRE late 20s | 7 | 4d | |
| +23 | Thoughts on joining an early-stage REPE fund | 7 | 1d | |
| +22 | Self Storage ECRI | 9 | 3d | |
| +20 | How to get good at RE Modelling? | 18 | 9s | |
| +18 | 3 Hour Condo/Rental Excel Test - What Can Be Expected | 2 | 4d |
Career Resources
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
Bump
Your not even in RE lol
1) 0-8 months: Had a base salary of $43k. Analysts in HCOL cities were getting about $55-60k salary if memory serves correct. Basically enough for you to not starve but you definitely aren't living lavishly.
8-12 months: Same base salary but was given 5% of the team's net fees as bonus.
12-18 months: Same base salary but was given 10% of the team's net fees as bonus.
FYI bonus is paid out of the broker's pocket and not the brokerage - entirely discretionary.
(2) I had one 4-month internship in leasing. Switched to capital markets after graduating.
(3) Day 1
(4) First year was brutal and didn't make anything other than salary. Second year a lot better and made about $70k bonus in the first 6 months. Transaction volume was probably $400m in those 6 months.
(5) Hours varied a lot. Some weeks 40, others 80. Average was probably 55. Work included underwriting, putting together marketing materials and pitch decks, and managing the marketing / sales process. Basically everything other than selling as I was not licensed and was on a very lean team.
OP here-Did you end up getting your license later? Or would you say it doesn't make too much of a difference going in? Thank you for the detailed response. Really appreciate it.
I never ended up getting my license but that’s more due to my personal interests - left after 1.5 years to a fund manager and had always planned to go this route.
I was getting lightly pushed to get licensed but it really comes down to personal preference - I know of analysts not getting licensed even after 4 years of experience as they weren’t interested in becoming a producer. My boss told me if I wanted to stay in that role I’m more than welcome to, there’s just a bit of a ceiling you hit in comp.
I’d also say if nobody is pushing you to get it, don’t. Worked with someone who was very eager to get licensed and paid out of pocket to do so in his first year despite nobody telling him to. Ended up getting pushed out as he never bothered to learn the ropes and was viewed as a liability if he ever were to talk to a client. (FYI this is in regard to capital markets only, might be more acceptable to go straight to sales in a leasing role)
You aren't going to make much until about 24 months in. After that it starts to happen. If you can survive it's worth it.
What has your comp progression been like since then?
Would you say the difficulty comes from salary more so than the work/hours?
D/E Brokerage
First-year Intern 0
Second-year-15K (still in college)
Third-year (first year on my own) 85K
Fourth-year 250K+
.....A lot
Brokerage is a tough business but if you break through and carve out a niche there is really good money in it.
What type of firm are you at and are you on a team? Is this normal and how do you see your comp scaling going forward?
Depends on the shop you go to and structure.
If you join M&M or a small shop without a senior support, 90% chance you will fail or get lucky.
If you go to CB, JLL, etc as an analyst and learn from a solid group, your odds go up materially! Some of the best brokers I have met, came up through the analyst track. I have also seen former CPAs, business owners or people that come from the principal side that go to brokerage and use those relationships to score deals. Even though, your first year or two might be tough.
Brokerage isn't rocket science but joining the wrong team where senior guys steal deals from junior, and everyone is a SHARK will leave you with a bad taste of the industry! If you are 22 to 26, I would say go with one of the big shops or use a family connection to get you on a team.
If you are a white guy, you can tell everyone you got the job on your own even though mom, dad, frat brother, friends parents, neighbor, etc probably got you that gig.
Started at a small 3 man shop doing tenant rep. $10-15k first year, $40k second year, $100k third year. Left to start my own shop and made about $150-300k next 3-4 years. Ramped up since and now consistently net $1-2m - 90% coming from repeat and referrals.
How long ago did you start your shop? Is this all from you or do you have brokers under you?
What's the reasoning for leaving IB for brokerage? Unless you're the OP on multiple handles.
Started about 10 years go. That's what I generate. I make a bit extra from a couple guys under me, but it's not really a profit center and more of just having people below me to kick things I don't want to work on to.
.
Im in a rapidly growing second-tier city and started at a small boutique that merged with a rapidly growing national player. I also focus on a niche market type (Infill/Covered Land), so my response may not be the most relevant but think it could be helpful.
(1) Did you have a draw or base? Yes, bare minimum draw/loan of $24k per year for 3 years. I had to work as a delivery driver on the weekends for the first 2 years to make ends meet. Just got off draw last month and am on pace for my 1st 6-figure month this month and hopefully hit 7-figures next year. It takes an eternity to sell land and covid wiping out all of our deals just as we were getting started the first time didn't help.
(2) Prior experience in finance or RE? Yes and no. I worked as a municpal redevelopment and economic development consultant prior to becoming a broker. I had plenty of exposure to real estate, but little on the private side. Took REFM and other online courses to get my private side knowledge to a competent level. I had a Finance degree so modelling came easy to me, and my exposure to land development and public process has been a huge help in the transition.
(3) How long till you were put on a team? I was actually brought in off the streets to start our land team. I delivered the owner some food and a resume while job hunting and because of my prior experience and exposure to land/development considered my the most knowledgeable about land, but I knew absolutely nothing abut brokerage. The owners knew a lot about brokerage but not land/development so figured we could figure it out. It really took off when my current partner joined me when he left a big shop after a bad merger, and it's been gangbuster since then. Now we lead a team of 3 brokers an analyst and TC.
(4) Commission and transaction volume? Total under contract and pending as of today should have me taking home ~$600k within the next year after team and company splits. It'll likely be closer to $1m since we do get deals that will close in 3-6 months vs the standard 12+ months we normally see for land.
(5) Work hours and type of work? It was brutal in the beginning while growing the book of business from nothing. 70+ hour weeks regularly with me putting in 5-10 hours of delivery work on the weekends to survive. Work was literally everything involved in creating a new line of a brokerage business. Tons of cold-calling, prospect research, database management, marketing, tracking, contract management, negotiations, sooo many coffee meetings, comps/data pulling, public meetings, sales training, proposal and OM creation, as well as the standard fun booze and schmoozes and fancy dinners thrown in. It's a fun business, but requires a ton of up front work with little pay. Nowadays it's 40-60 hours with the ability to take time off here and there whenever I want.
Impressive. How many years have you been doing it now? Where are you located?
Licensed for ~3 years now, just about to start my 4th at beginning of next year.
Thank you for the detailed response. Extremely helpful.
Many years ago but another data point. Big 3 brokerage in landlord rep. Year 1: $45K draw with maybe $20K discretionary bonus from seniors; Year 2: $140K; Year 3: $225K, Year 4 prorata (left mid year): $450K.
Is that progression normal?
I would say probably not. I had the advantage/luck of stepping into a solid book of landlord rep business where we had 25-30 listings in a Tier 1 market...I wasn't doing much business generation and was my senior partners were pretty generous in cutting me into a significant portion of the fees after only 12 months.
In my short stint as a broker in a HCOL I was told that if you aren’t grossing $250,000 per year as a broker by year 3, it’s just too hard of a business to keep at it. (At $250K you’ll net $125K before taxes).
Ipsa aliquid pariatur nemo dolor. Commodi suscipit sit est et consequatur consequuntur. Quaerat quas eum in nihil.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Quasi quia numquam qui. Numquam occaecati sed temporibus minima accusamus. Laboriosam dolorum neque magni aut.
Laboriosam quo necessitatibus consequatur. Dicta illo assumenda modi corrupti molestiae quis. Ut quibusdam excepturi ex fuga iste aut magnam qui. Reiciendis odit culpa enim perspiciatis expedita ducimus enim. Deleniti necessitatibus aperiam autem aut voluptatem. Voluptate officia minus tenetur perferendis totam praesentium veritatis. Dolores sint et dolores alias ea.
Molestiae qui neque rerum id voluptatibus eum. Deserunt praesentium sed consequatur rem. Voluptas minus nostrum consequatur sequi nostrum omnis debitis. Voluptas ut voluptatem asperiores. Eos voluptas facilis sed sunt totam. Ullam ea ratione vel aut cumque aliquid neque.
Aut nisi beatae fugiat saepe. Eligendi libero consequuntur fugiat deleniti. Pariatur et non non quibusdam.