REIT associate interview and salary negotiation

GridironCEO's picture
Rank: Neanderthal | 3,506

Hello everyone, I am a grad working in a middle office type role in Corporate Banking and graduated from a non ivy target school (although some elitists on here might consider it a semi target) one year ago and have an interview with an REIT for an associate position working in Development. I have heard through networking that base salaries are usually around $80k-$85k. Can somebody shed some light on this and also tell me what someone can expect from bonuses if they are even given? This firm is one of that largest REIT companies listed on the stock market.

As a finance guy, I know my basic technicals that the banking kids studied, although don't know anything about real estate. What should I be expecting in terms of the interview process and questions?

Thank you so much. I really want to transition my career into real estate for the long term. I'm not happy at my current spot, but definitely don't want to do investment banking if I were to "move up" and other front office finance gigs are way too competitive to get.

Comments (26)

Best Response
Jul 26, 2016

Someone will undoubtedly post this so I'll beat them to it. I'm tired, but I'll try to write something tomorrow if no one else wants to give their two cents.

http://celassociates.com/prime/wp-content/uploads/...

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Jul 26, 2016

Thanks, I've actually seen that before when I started my research. All my interviewers have always asked me what my "salary requirements are" although I've never been asked or even stated a request for bonuses, so don't know if those are even appropriate to mention. I have no experience with Argus, but am experience with Excel. I guess it will be basic fit questions, tell me about yourself, and why Real Estate? I'm not too familiar with the current state of the real estate industry/markets or even what the job entails too much. Just have solid finance experience and know that this opening and interview is a good opportunity, to be quite honest.

Jul 26, 2016

Not sure which food group the REIT falls in, but it is earnings season so they're all giving their commentaries right now. I'd listen to that to see how they're approaching stuff. Probably wouldn't hurt to listen to their competitors either. Seeking Alpha also transcribes these so you can go back a few quarters and get a feel for where they've been and where they're trying to go.

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Jul 26, 2016

Yeah thanks that is actually great advice! I remember my favorite professor in college was actually an adjunct professor, had never even received a PHD, was just so goos as an investor that the school brought him in. He said that whatever we choose to do in life, when interviewing make sure to read the company's earning reports, annual report, 10k's, letter to shareholder's etc. and you will know so much going into the interview. This REIT is actually doing pretty well right now, price of the stock is high, and some investors think its overvalued and thus a "Hold" or a "Sell" but definetly not a buy.

Jul 26, 2016

Sounds like a smart man. I try and read all of the multifamily ones every quarter. I've got a list of all of their transcripts going back to 2007 that I'll post on here sometime.

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Jul 26, 2016

I think $85k sounds right, and wouldn't be surprised if you can push it to $90k. Depends on the city though. I'm at 7% bonus (non-negotiable) and at one of the better REITs out there (but only 20% of SPG's market cap). My bonus % might be a bad comp (I honestly don't know), but hopefully it gives you some context.

For the transition part, search around the forum and you'll see 10000000 threads asking the same questions about what to expect in RE interviews. For REITs specifically, you might want to look at FFO, AFFO (and the line items that go into each), capitalized interest, net asset value...literally google "green street advisors glossary" and use that to help your prepare for REIT specific stuff. Based on what I've experienced so far, and also from talking with others at large REITs, you'll probably need to know how to build complicated real estate models from scratch.

Jul 26, 2016

Job is in one of the more expensive cities in the US and $26B+ market cap. It is for someone with 1-3 years experience, I have 1. Salary level is listed as $80,000-$89,000. What should I say? $80,000 is more than what I am making all in right now and the REIT company is doing well, and no job is guaranteed, however I don't want to leave money on the table.

Jul 26, 2016

They're asking for comp before the first round? Personally with 1 year of experience I'd probably say the median of the range you mentioned and go from there. But do what you think is right. What property type are you going to be working on if you don't mind me asking? I'm working on retail and mutlifamily

Jul 27, 2016

$85+ bonus is exactly what I would expect going in.

Google "real estate investment terms" and know them. (for example: http://www.proapod.com/Articles/real-estate-invest...) Also, understand that all of the terms are called at least 3 different things by different people, so use a few links. It's not rocket science, but "knowing the lingo" will help.

Google their recent deals too and get a sense of what they acquire and/or develop. Inevitably, they will ask why real estate, and you will say "because it's tangible" since that's both the default answer and the real answer, so it's good to be able to name drop some assets or projects of theirs that impress you.

Jul 27, 2016

LOL at the tangible answer.

Was my go to answer

Jul 27, 2016

Do people actually call income minus vacany and other income GOI? I've never come across it, I have come across PGI or PGR.

Jul 27, 2016

I've seen it in a textbook.

Jul 28, 2016

Question you @CRE and @indexmatch : are you saying that $85k is appropriate based on that its a larger REIT, in development, or that the title is associate? I know that its been discussed on here that titles of analyst/associate are interchangeable and sometimes don't mean much, so just looking for some clarity.

Jul 28, 2016

Sorry - my comment wasn't incredibly scientific. In my experience, $70k+Bonus to $90k+Bonus is pretty typical for the role you're looking at, so a $85k salary just "seems right" to me.

Jul 28, 2016

Can relay off that and say that's valid. Know a colleague that was offered 80k-90k + 10% bonus for a development gig.

Aug 1, 2016

Mainly because of the title. I know a few associates at smaller REITs getting paid $85k base. I'd assume if you are an associate at a larger/better REIT, you'd be getting around that (if not more, but sometimes that's not the case as some people stated above)

Jul 28, 2016

For 2nd / 3rd Year Analyst-Associate Roles:
Top Tier REIT (Mega Market Cap): Total Comp $100 - $135K
So-So REIT (2nd Tier Focused): Total Comp $80 - $100K

Top Tier MBA greatly affects comp at REIT's in general. Multi-family REIT's are also notorious for not paying well.

.02

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Jul 28, 2016

"Multi-family REIT's are also notorious for not paying well." How consistent is that statement in the industry and why would that be? I thought multi family were some of the biggest money makers in terms of ROI. People will always need a place to live. Whereas in CRE there can be empty offices.

Jul 29, 2016

Just because a company has a huge market cap doesn't mean that everyone is rolling around the money train. Real estate is incredibly capital intensive and up until the early 2000's was traditionally on the lower paying side compared to most other roles in finance.

Commercial real estate is less human capital intensive versus multi-family. Commercial real estate generally requires higher capital investment relative to multi-family.

If you think about building out a multi-family operation medium or large scale the amount of people required from on-site management > property management > controlling / accounting > central management just requires more scale.

I base my opinion on a number of analysts that work at $1bn+ multi-family REIT's. To be fair though if you have no real estate analyst experience it's going to be tough to push on comp. Unless you were at a top tier PE / Bulge bracket firm real estate shops don't give much credit.

.02

Jul 29, 2016
gridironceo:

People will always need a place to live. Whereas in CRE there can be empty offices.

reprof:

Commercial real estate is less human capital intensive versus multi-family.

Just to clarify here - Multifamily IS Commercial Real Estate. It is another asset class, alongside office, industrial, retail, hospitality, etc., and while it is different from those listed (just like those listed are all different from each other) it is not another category altogether.

"CRE" does not mean just office or just office and retail. It is any property developed for commercial, i.e. making money, purposes. I'd listen to arguments that individual single family shouldn't count unless you're the one doing the master land planning, but multifamily certainly does.

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Jul 29, 2016
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Aug 1, 2016