Hi, i'm in Silicon Valley and am considering making the switch to commercial RE after almost 3 years in residential. I've been traveling to Asia every two months building up my database and have made some solid contacts with developers as well as some HNWIs who are looking to purchase hotels and office buildings.
I understand you're expected to focus on one niche in the business. I'm starting to setup meetings with MD's at Collier's, JLL, CBRE, and possibly NGKF (C&C here) to try to land interviews . I've also had the KW Commercial director of one of the local offices ask me to join but obviously they are a small time player compare to the others and I don't think that'll be beneficial to me.
What are splits like? I've read that most places start you at 50/50? I look at that as robbery.... What's everyones opinion on those brokers? For those of you who've made the switch from JLL to CBRE or CBRE to Colliers, etc.... can you list some pros and cons? I'm a firm believer that people ultimately hire you for your personality, experience, and what you will do for them- the brokerage comes second, but I want to be with the best. At my current brokerage, we dominate in every aspect, marketing support, etc... and even though the highest possible split isn't as high as somewhere like KW, everyone knows and trusts our brand in this market so I choose to stay with them.
Personally, I would start focusing on networking with some middle to top brokers that pull their own weight and can give you some insight on their day to day. From there I would suggest getting onto an investment sales team so you can learn the ropes and potentially have some type of small salary or draw.
What house you go to now should depend on how much experience you'll gain and what type of leadership you'll be under. I wouldn't focus too highly on the split as you'll be getting generally reamed no matter where you go now. Once you prove yourself you can start negotiating and exploring other shops. Also look into what type of assets you want to handle as some brokerage houses primarily focus on a few select asset classes while the CBRE/M&M/KW's of the world will handle everything under the sun.
I'm not in brokerage myself, but those are my thoughts for what they're worth. I'm sure some of the IS guys can chime in here as well.
At a CBRE, Cushman, JLL, and Colliers, chances are your splits will all be 50/50 to start. As you generate more revenue, it will move in your favor, and go back to 50/50 every January 1. At all of these firms, the 50% is paying for the marketing department you will be using, costar accounts, research department, etc. A firm like KW may have amazing splits, but these other brokerages are the top dogs for a reason, and chances are (though not always), working at the top places will allow you to work on deals you would not have the ability to work on otherwise. If I remember correctly, KW Residential is interesting in the fact that it is something like 50/50 for the first $108,000 and then the salesperson keeps everything. That's awesome, but they probably provide a lot less resources than the top firms. If I were you, and you wanted to go the KW route, look into what will be provided for you. I don't view 50/50 as robbery, but I see why you feel that way. With that said, I think it might be smarter to start at the top firms, learn to work on the institutional level business (if this is what you want), and then move to where you can get better splits or the splits you are looking for. That way you have the experience and relationships.
Great advice, appreciate the info.
Most of the splits are sliding. You earn more the more you get until you can prove that you're consistently going to be able to produce and will sign a fixed split.
To add bit more info, splits might look like this:
Salesperson : Brokerage House
$0 - $400,000, 50%:50% $400,000 - $600,000, 55% : 45% $600,000 - $1,000,000, 60%: 40% $1,000,000+, 65% : 35%
All firms will be different, some might have a top split of 70% : 30%, etc.
Residential RE to CRE (Originally Posted: 07/17/2015)
Hey guys,
New to the forum, and I would have to say, some of the posts on here are great and very helpful.
I just graduated college (3.4-3.5 non-target) and landed a job as an acquisitions manager for a small firm (approx. 700AUM). I've been working for a couple months now and see about 10-15 properties a day in NJ/NYC. I see the property, send the data to the analysts and conduct th negotiants with he agents if we decide to purchase the home.
My question is this: how hard would it be to shift from residential to commercial. My ultimate goal is to do industrial as either a broker or acquisitions, but I couldn't let this Job I currently have go.
Any advice would help, as I am looking to start the transition in the next 6-12 months. I do have my RE license in both NJ/NY.
Cheers
I did this transition over 15 years ago. The only way to start is to say "this is what I'm doing." Then go learn the fundamentals of your market/asset and start making some calls.
When you say residential, are you talking about single-family homes or are you talking multifamily residential (apartments)?
I deal with 1-4 family homes/townhouses in Brooklyn & Manhattan... I do ultimately (1 year or so) want to transition to industrial or retail CRE... It is much more exciting, fast paced and cut throat than the work I do in residential
Sounds like you're already doing commercial.
The thing is, He's not "in" multifamily. He tours a dozen single family homes a day. Unless he wants to be in the SFH massing business this isn't really the best spot for him.
Yeah, my comment, and I think @cre123" 's, were more like "why retail or industrial when you already have a working understanding with and experience in multifamily, even though not in the position you want to be in?"
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