Q&A: I used to be a CRE Broker at a Firm that used to be Top-Tier

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In honor of this disappointment, I thought the community could step up to the plate a bit. I used to be a CRE Broker (office leasing, mostly on the landlord side) at a firm that people will debate about below! Ask me any questions about this or anything else really, and if you're currently a broker, answer other peoples' questions.

Comments (63)

 
Jul 16, 2019 - 4:36pm

Hi there,
Thanks for doing this AMA! I'm a nontarget currently interning at a brokerage shop focusing mainly on smaller deal sizes (think M&M/SVN). My internship is mostly filling out a database with new properties, with a little bit of underwriting mixed in. I'm having some trouble finding new properties to put into my database - would you recommend any real estate data sites other than Costar/Yardi/Landvision to search through? On a multifamily team if that helps.

Follow up question: If my goal is to get into REPE acquisitions or development, would you recommend going straight to broker, or going the analyst route?

Thanks!

 
Jul 16, 2019 - 5:01pm
  1. I'm probably not the expert on this anymore, but if your firm has access to Axiometrics use that. Also, don't be afraid of Apartments.com or googling "Apartments Near X" and cross referencing all of your sources. Likewise, don't be afraid to ask your boss for help - much better to be pointed in the right direction once than flounder for a week.

  2. Going straight to analyst in either REPE or development is the ideal route, but if that doesn't work out for you (it didn't work out for me) then by all means get a job at a brokerage shop. In your early years, getting a job in the industry to show that you're interested in and involved in the industry is the most important thing.

Commercial Real Estate Developer
 
Jul 19, 2019 - 1:57pm

Here's the issue with going straight broker-- you're going to make very, very little the first year. You're going to know nothing and feel useless for a year or two. Cold-calling, grunt work, doing the dirty work. However, you will (hopefully) immediately start to meet people, start networking, tell people you're a junior broker, etc. If you want to be in REPE acquisitions/development, this may help you but if you want to be in acquisitions/development, you're still going to need the technical skill, which you might not pick up as junior broker.

Now, if you go analyst first, you'll get into the numbers, but you won't meet the people.... unless you go to networking events and try to talk to people. Your overlap in conversation pieces are going to be less than if you were actually working the deal as a broker, but I think you can still substantively network in this position... If you learn the technical side first, hopefully you'll be able to talk-the-talk while networking. You won't be expected to talk about the deal you're working on, but if you can, maybe you should.

Honestly, I think your day job would be get the technical skills and the night job would be get the soft skills. In terms of getting the REPE job, you're going to get it likely through the networking. Maybe a lateral transition from analyst at brokerage to development shop or REPE shop. That's when you perform and go up the chain.

 
Jul 17, 2019 - 9:50am

CodyParkey:

This might be more suited for someone else, but what does it take to be a top debt broker? What are the best skills, and best character traits to have?

I'm betting that people of different character traits can succeed in debt brokerage. Not sure what the best skills are internally, but as someone who hires debt brokers, I hire based on network and market knowledge.

Commercial Real Estate Developer
 
Jul 17, 2019 - 11:37am
  • What did comp look like among subpar, mid-tier, and top performing brokers?
  • What were some of the common paths you saw to becoming a broker?
  • Why did you pivot to development?
Array
 
Jul 18, 2019 - 7:02pm

BobTheBaker:
- What did comp look like among subpar, mid-tier, and top performing brokers?

Subpar is $0/fired.

Middle is $100k-$200k. Most are this.

Top is $250k-$350k. These are players or people high up in companies.

Then there are a handful of top guys/ladies in each market (could be more than a handful in major markets) that regularly pull in 6 figures.

Someone else can confirm this or reject it. Things change in 6 years.

BobTheBaker:
- What were some of the common paths you saw to becoming a broker?

Greek life and sales experience. A year or so as an analyst, maybe, then off and running.

BobTheBaker:
- Why did you pivot to development?

After dealing with owners, I wanted to be an owner, not a third party guy. I picked development over acquisitions/asset management because of the creativity required and the wide variety of skills needed/day to day experiences.

Commercial Real Estate Developer
 
Jul 17, 2019 - 9:34pm
  1. What would you tell your younger self about CRE brokerage? What skills would you have worked on, what knowledge would you have gained, and what certifications (if any) would you have pursued prior to pursuing a position in the industry?
  2. What, in your opinion, makes the ideal candidate for an entry-level position in a CRE brokerage? What traits, skills, and qualifications are looked upon favorably in applicants?

Thank you for your time, and for starting this thread. This is an industry I’ve become very interested in, and any info you can provide is much appreciated.

 
Jul 19, 2019 - 12:22am

Thank you for your reply! I've got more questions if you're up for it, though from your other posts here I gather that you're a pretty busy guy, so I understand if you don't want to go through the spanish inquisition with random people on WSO.

What brought you to brokerage in the first place, if it wasn't what you wanted to do? Were you just trying to figure out what you really wanted to do at the time? If that's the case, how would you have done things differently, with hindsight, to get into development earlier?

Would you really say that it's just down to extroversion and projecting confidence? One thing that I've learned from my (very unimpressive) work experience is that success in sales depends on projecting confidence and knowing your product, but surely these qualities can't be that rare. Are there really no pre-existing qualities that people should have going into CRE brokerage, other than people skills and knowledge about the local real estate market? Because if that's the case then I'll start handing out resumes yesterday.

 
Jul 18, 2019 - 12:26am

How did you make it day to day? Pay for things like groceries and anything else we take for granted.

As an entry level broker, you’re making $0. I’m just curious what your life was like then, and how you dealt with it. Sorry, for less of a professional question. I know most people want to know about how much $$$ everyone can make in brokerage, and it truly is the gold mine if you can swing it. That said many more of us end up on the principal side because it can be an absolute grind.

 
Jul 18, 2019 - 1:27am

Curious as well as I graduated in May and haven't landed anything yet, and will soon have to take on something PT while searching. My plan as of right now is to do overnight stocking at a grocery store on the weekends and network and interview on the weekdays. Grocery store in particular I am considering has shifts from 10PM-6AM and pays 15/hr; not bad. Not OP but if I had a FT during the weekdays I would do something similar to this most likely.

 
Jul 25, 2019 - 1:44pm

Do most brokerages typically offers draws to their employees to stabilize their income cashflows? How does the draw system work, is it based on the numbers you pulled from the previous year? I could see it becoming a large financial liability if the market cools down and all of the sudden the firm has these outstanding draws that most likely wont be paid back entirely with the stifled market.

 
Jul 18, 2019 - 9:58am

Assuming you mean, I don't think they were ever "top tier". Maybe in some smaller markets they had some heavy hitters for certain asset types, but as a whole they always have been lower second, high third tier.

Array
 
Jul 19, 2019 - 1:33pm

I worked in, they were good on leasing but pretty terrible on investment sales and debt.

I am now on the LP side, multiple markets, multiple asset types...I quickly realized is NOT indicative of the greater nation at all.

I don't really see them as a strong firm holistically at all, and don't think they ever were.

Array
 
Jul 18, 2019 - 11:12am

When your valuation and IS sales team counterparts call you for client requests for lease comps and things of that nature, how forthcoming are you with your best/latest & greatest information? I've always wondered how much this information is filtered depending upon who is asking. I feel like I'm seeing less willingness to share that type of info now that I'm on the lending side compared to my experience on the equity side.

 
Jul 19, 2019 - 11:38am

This is actually a great and very loaded question. I really don't even know where to start but I'll just go with where my mind wanders...

Yes, it depends who you are when you're asking an IS team for comps, data, etc... If you are Joe Nobody from nobody xyz firm with no equity then chances are you will either be ignored or given a half ass costar pull.

In your case, a lender, you're probably getting 2nd rate data as well. The mind of a broker is simple, "will this person directly result in me getting a commision?" If the answer is no and you aren't a friend of the firm due to some other connection then chances are you'll be SOL. EDIT: clarification; you're a lender asking the IS team for data. Not a lender asking for a D&E team to provide data

The reality is that IS teams have their "guys" and if you aren't in that subset then you're at a disadvantage. Steering deals exists. Bad advice from brokers to owners exists if it results in a deal going the way of a friend who will sell the property again in a couple years and give it right back to the firm that sold it to him no questions asked. This is why acquisitions is a sales job. I know, it's disheartening coming to the realization that being smart will only get you so far...

 
Jul 18, 2019 - 4:19pm

You don't see that much. You obviously have the right skill set if you're IB, it's a matter of demonstrating genuine interest in RE. A lot easier than you think - join and be involved in ULI or NAIOP, get your real estate license, etc... those moves would put you in good position.

In terms of firms to target. High caliber investment sales teams would like someone like you. REPE would as well, I'd imagine

EDIT: Sorry totally blanked and hijacked you

Start thinking about how RE guys look at and develop models.

 
Most Helpful
  • Developer in RE - Comm
Jul 19, 2019 - 9:51am

famejranc:

how to find job

Cold emails. Cold calls. Getting coffee/lunch. Following up.

To get a job in brokerage, you need to act like a broker.

Commercial Real Estate Developer
 
Controversial
Jul 19, 2019 - 9:37am

No offense, but are you sure you're the best person to be doing this AMA? I appreciate your commitment to providing content here but I feel like there should be some additional disclosure on where this advice is coming from.

Array
 
Jul 19, 2019 - 10:52am

I think the title/OP is pretty is pretty tongue-in-cheek and self explanatory.

Look, I too used to be a broker at a dominant local brokerage firm, but I was terrible at it (probably because it wasn't actually what I wanted to do). I think I could answer a few questions regarding what it takes to be successful and what not to do in brokerage.

Everyone in this industry has a perspective and experience they could share, especially given the varied ways some people end up in the industry. I think if you have something helpful to say, chime in.

 
Jul 19, 2019 - 11:38am

holeymoley:

and what not to do in brokerage.

Regardless of industry I think this is a more powerful way to learn. Appeals to people's tendency to prefer avoiding losses over acquiring gains.

Fewer "10 Things to Do as an Analyst" and more "Avoid these 6 Screw Ups and You'll be Fine"

“Doesn't really mean shit plebby boi. LMK when you're pulling thiccboi cheques.“ — @m_1
 
Jul 23, 2019 - 2:01pm

I interned at a top tier brokerage firm in a major European city in IS as an analyst and as I am reading everyone's comments i'm starting to see a lot of differences between how my office used to work and how american offices work. As someone who wants to work in America I'll be glad if someone can answer me and tell me if the practices in Europe are the same as in the US:
_Do you guys also have a team of analysts not commisionned and a team of IS brokers splitted between asset classes and volumes?
_As brokers do you also have a client list that is dedicated to you and that others can't touch? Meaning that if your client is selling an asset and calling your firm to pitch you're the one who handles the pitch and transaction.
_Is your comp also a pretty decent fixed (say 60k/year) and then a bonus depending on the amount of fees you bringed home but not an exact percentage of the fees you bringed or is it almost 100% commission based in the US? If so how's the relationship between brokers ? It must be tense.
_Do you also start as an analyst and then potentially make it to broker or transfer from leasing brokerage to IS or do you immediatly start out of undergrad as a broker?

Thanks a lot to the people who can answer me

 
Jul 23, 2019 - 2:13pm

I'll answer in order:

  • Analysts are typically salary + commission (or tips) on a deal by deal basis. Some firms (Eastdil) are strictly salary + bonus regardless of position
  • To my knowledge, Eastdil is the only firm with a salary + bonus structure at the broker level. The other major firms are strictly commission split with the house.
  • Path to broker these days is more commonly IS Analyst --> Junior IS broker (executing business ---> Director/Senior Director (sourcing some, mostly execution) --> MD (75%+ sourcing while executing some deals)

Just to note, this is the IS path. Path on the leasing front would be commission only out of the gate, perhaps with a draw depending on the team.

 
Jul 25, 2019 - 12:54pm

I want to be on the other side as well (owning the properties), but i'm unfamiliar with the networking side of real estate right now. In regards to your experience, would having a close network with brokers (as a REI) help you get the best properties?

So, the brokers would know "oh, monkey is looking for a property just like this!" and reach out to you. Does that happen frequently?

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