I am currently working as a development associate (it is an entry-level role) with a very cool, smart, agile developer on the smaller side in a major US city (not NY/SF). I am learning a very great amount in my current role, enjoy my team, etc. However, my pay is south of $50k which only just barely covers my frugal living and minimum student loan payments (I have around $85k), with no room for saving or even an emergency fund, let alone niceties. I am not a fan of the city I live in.
I have an opportunity to join a top-performing southwestern state investment sales team (a Warren Buffet favorite, not CBRE/Cushman/JLL) located in the city I want to be in. The salary is a 10% increase plus bonus, allowing me to slash my student loan repayment time in half as well as actually have savings/fun outside work. The role has the opportunity to potentially develop into a producer position if there is a fit and I demonstrate my abilities (the actual work I will be doing, I have been doing for years and have no worries about acing).
I want to develop property in the long term but I have this feeling that even if I am the most skilled development guy out there, with zero money of my own I won't get a single thing done. If I am going to have to go to a big development shop or fund in the future anyway, might as well jump ship now...or not? I am confident I could make more money and not stagnate in the investment sales role, but I will certainly not be exposed to the full spectrum of development work as I am now (although for what it's worth I am doing LOTS of property management support and investor relations right now).
This development role was my dream job when I applied for it but I am curious to see WSO's input on changing my position? Am I hurting myself by leaving development, which seems like an end goal field for so many people?
I would say take the IS job. Having that brand name company on your resume will open up a lot of doors for you in the future. It also seems like you'll be a lot happier if you take the job too.
Good point. Choosing between good things is always the hardest. I wish there was a smoking gun somewhere.
You have two separate issues here:
You certainly can address these issues together (i.e. leaving your role for a better paying investment sales role) but you need to think about them independently. Is it development you don't like or is it being poor you don't like? There are most definitely other development shops that pay better (I can't imagine one paying worse...) not to mention the option of talking to your boss about your situation and seeing if he or she leans in to help.
You have to do what you think is best for you. I would never leave a development role for an investment sales role, but I'm not you.
Thank you so much for your thoughtful response. I commented something to a poster below and wanted to see if I could get your opinion on whether - step down or not - investment sales has the potential to expedite an individual development career.
There isn't any room for a raise at my current company unfortunately. My perspective on what it takes to do development has generally shifted over my short time with this firm from "tremendous experience" to "experience and capital". I'm learning a lot and love development but I never want to work at Related or Habitat or whomever - I want to develop for myself (not skyscrapers, and not in NYC/SF). That is really the sole thing that has me interested in real estate. So if an IS role can make more money for me, I feel like it might be a good idea.
I agree with CRE ..I'm currently in an hybrid role, where I deal with acquisition and development opportunities and mho is that development role seems more complex and interesting than acquiring property. Dev needs more knowledge and interactivity with others than acquisition.
Personally, I do not see the broker/sales position as an improvement from your current position. I believe you are/should be higher in the food chain than a broker...According to your salary I assume you are quite junior..and underpaid for your role/tasks. Like CRE said, you should either find a firm that would pay you market salary or ask for a raise (start by asking your peers for comps etc..) People talk a little bit more because we are all curious and human..lol If development is your dream job, than I do not think you should let money problem get in the way.. :)
Good luck with that..
I appreciate your comment. There isn't any room for a raise at my current company unfortunately. My perspective on what it takes to do development has generally shifted over my short time with this firm from "tremendous experience" to "experience and capital". I'm learning a lot and love development but I never want to work at Related or Habitat or whomever - I want to develop for myself (not skyscrapers, and not in NYC/SF). That is really the sole thing that has me interested in real estate. So if an IS role can make more money for me, I feel like it might be a good idea.
I understand what you mean..but MHO, is that if you want to do your own stuff..you are going to need more than a 50k raise at the current land prices... I admire/feel you on this matter..Would there be a possibility to "dip" in the deal at your current dev firm ? Which would somehow fulfill your dream/need ?
God damn, is this really what most Development Analysts are getting paid at a non Hines/Related/Brookfield type shop?
Development or Investment sales Thoughts? (Originally Posted: 01/26/2018)
Been reading threads on here for a while and am recently in a posistion where I would appreciate some guidance. Little background, I am in a 5 year MBA program and wrapping up this spring while I work for a value add developer in a northeast market. It is a decent size shop, more than 60 people and properties in five states. Unfortunately, I haven't been doing much of the type of work I was hoping to do, such as underwriting and sourcing deals. My role is more of a development management role where I coordinate with attorneys, architects, engineers, and GCs. I have been there four months and this has been the extent of my work. The principal of the firm took me out to lunch today and told me he wants to know if I would like to stay on post graduation. He wants me to grow into a role where I am taking more work off of his desk and gn the road with him and the partners to check out deals. He told me being taken under the wing of a developer straight out of School is a great opportunity to learn a lot quickly.
My entire dilemma is I feel like I am skipping a step in the sense that I am not learning much underwriting or getting any Argus experience. Prior to working with the firm I was an intern at HFF where I did a lot more valuation work. I would like to become a deal guy down the road and feel like it is imperative to understand how to value assets. I have interviews lined up with HFF, Duff and Phelps, and Altus group this spring. Thoughts?
I feel like most people go into developement after starting in valuation, brokerage, or REPE. While I find it valuable to be taken under the wing of the principal and groomed, I feel like I am skipping a valuable step in the process. I am currently the youngest guy in the office by 10 years and feel there is opportunity to grow. If I did stay any thoughts on what to ask for salary.
Overall looking for career path advice. I know I'm all over the place here.
yeah, even Development Analysts out of masters programs will often see starting salaries at like 60K or so. Just a gut punch because a senior out of undergrad with two or three internships under his belt could also land a similar job with the same salary but without additional debt of a masters.
No
There is a massive quality of life difference between $45k and $60k
I am literally in the same boat and would love some insight on this topic
If you like development and have goals of doing your own thing some say, staying on might not be a bad idea depending on the firm and the quality of deals you are reviewing. Deal flow is critical, and you will certainly see that at the shops you mentioned. I frankly think the project management, politics, and capital raising and marketing of development is more challenging than the underwriting, and think that UW can be learned on your own time. A wise man at my firm once told me that you can underwrite until the cows come home, but what really separates the seasoned guys from everyone else is what they have actually built/developed. You’ll probably get a lot of different opinions here, but I say do what makes you happy and you think you’ll stick with for your career. Life is too short.
No. I’m a second year analyst at ~90k
Didn't you already post this?
To summarize my other response:
Most people start in brokerage because they have to.
Skipping a step is a dream, not something to be upset about.
A good developer and a good investment sales broker require completely different personalities, skills, lifestyles, etc.
From where you are, going back to brokerage, or christ, valuation would be a major step back
Agreed, valuation modeling is only as good as the vision going into it. Some guys I know can do all the modeling they need on a napkin to make their decision.
In an exact situation as the OP. And yes in a secondary market, my salary is pretty South of 50k
Y'all are getting ripped off.
Our entry level guys are making $55k and they are getting ripped off.
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