Say you are working in brokerage or lending and you're goal is to join the principal side and you are relatively still young in your career (3-4 years experience). You're current title is Associate and you get paid $100k. You finally get your chance to join a REPE firm, your goal, but the offer is for an analyst position and the pay is $85k (no negotiations because 10 kids younger than you would take it).
This has been your goal and "dream" job since you graduated. Do you take this job or leave it and keep looking?
I'm basically trying to ask how do you recruit for your dream position when you are no longer entry-level at your current job. E.g., an associate on a debt brokerage team trying to land the equivalent on the principal side - how can one do that?
Assuming that 85k is the base, w/ bonus you should be making well over 100k all in if this is a decent sized repe fund.
Maybe not this year due to covid/how their portfolio is positioned. But I don't think all in you'd be lower than that 100k as a broker.
It isn't always a no-brainer, but the situation you described certainly is. $15k is nothing compared to doing what you actually want to do. You'll make that $15k up eventually.
You take the job. $15k difference in terms of base salary is nothing at this age and you will make that up like @CRE said in no time.
I'm sure you could ask the firm to bump your title to Associate or whatever you have now, but that's probably the extent of negotiations since you said they have others lined up behind you. Take the pay cut, crush the job, and that $15k will seem like nothing when you see your bonus on a good year. You're in a good position.
If the answer to this is "no" then it isn't a dream job in the first place.
I kind of took this route -- started in CRE lending as an analyst then after a few years jumped to a small REPE firm, though it was more of a lateral move.
In terms of how to land a job on the principal side, coming into the industry with zero connections, I just made networking an active part of my life and constantly studied up after-hours on financial modelling, finance, REPE, market knowledge, development jargon, construction, etc. -- I said yes to almost every single formal networking event to endless informal meetings/socials. After a while my circle grew to include my current employer who happened to be hiring.
Depends on your personality, personal goals and career goals. The great thing about the CRE industry is you can make good money in many ways, whether it's on the principal, brokerage or debt side, etc. If things don't work out you can usually lateral elsewhere having picked up wider experience, especially in early-mid career.
From my personal experience I'd say the main difference in terms of work is the depth and scope of work in REPE is higher than in debt, but the deal flow/pace is a little lower. You're taking on more risk on the equity side but hopefully compensated disproportionately better on returns if the projects do well. Subjectively I find the ownership side a lot more fun because you feel/know you have skin in the game, it's more boots-on-the-ground, there's more opportunities to think creatively to squeeze out value, and you interact with all sorts of interesting people (lenders, other owners, brokers, lenders, architects/consultants, local community, lawyers, etc.).
If you want to jump from brokerage/lending, you absolutely take it. This what happens, the pay difference is likely made up in stability and long-term bonus potential (really that seems to be the no-brainer part to me). The title is a nothing burger, analyst/associate are interchangeable when viewed from a senior perspective, it's not a down grade. Plus, titles in brokerage/lending are way over stated and often meaningless (like is anyone working for CBRE that isn't some type of VP?).
I've seen it a few times where associates have to take an 'analyst' position starting off in a new firm as a way to make sure you're up to speed. Almost all times they get promoted to associate within 1 year.
There is a lot of consensus that agrees that the principal side / buy-side has its advantages in terms of career satisfaction. I’m going to throw a little curve ball, because I don’t necessarily “always” agree, and want to make sure you want the buy-side for the right reasons.
I agree buy-side, there are more variables, in-depth analysis, and working with brokers and lenders, management companies, consultants, and upstream capital, etc all part of the job. There is the well capitalized buy-side that makes good decisions over a long period of time; there are others less fortunate - which can be miserable. The pendulum swings.
What I’m trying to say is career and job satisfaction can also come from, I call “working in the top group” or “having the most impact / tip of the spear.” Often times, if you are not on these teams, you might yearn for that information power, influence. You might be thinking “if I were on the buy-side, it would all be better.” I guess I’m defending the lender, broker, etc roles/ecosystem because you can find great job satisfaction; and what is a role on the buy-side, but some specialization. There are a lot of sell-side skills needed on the buy-side: internal brokerage to advocate your position, raising capital with hat in hand, etc. I’m going to assume buy-side and sell-side pay in CRE are correlated. Capital is flowing and fundamentals strong, things are good.
A career is long and who you work for and the timing of that is a big part of where you end up. To answer the OP directly, $15K pay difference should not stop you from taking something you would like better, assuming you have enough to live on.
I just want to distinguish what is really pushing your yearning for “the other side?” And is that “other side” in the same company, just on a different floor?
On a side note, when I wasn’t in the top group, I would go to their floor and eat their snacks. They had better snacks and cereal. I’m sure they hated it ; )
Here's my (cautionary) tale, take from it what you will.
I was in lending, about ~3 years into my career, making $100K + top bucket bonus every year as an associate after being promoted. It was a good, stable job - hours weren't bad, coworkers were friendly, work wasn't too complicated. However, I wanted more - things were not moving fast enough for me - I wanted to do more deals, bigger deals, more exposure, etc. Honestly, I put up with it for longer than I should have because I grew up broke and was afraid to lose what I had built.
Finally I had enough and through some networking, I landed my dream job on the principal side - well-respected institution, more responsibility (so I was told), similar compensation, but with an analyst title. I didn't care - I took it. Within a year, I knew it was a mistake. I was burning out - no life outside of the office from working late 6-7 days a week, no comradery in the office, no support or mentorship - the walls were closing in. I left and took a few months to reset with no plans.
However, the one silver lining was that with the brand/relevant experience on my resume, I was able to parlay that into another role on the principal side. I was brought in as a senior analyst at a well-respected REPE fund, and so far the role has checked the right boxes (responsibility, culture, growth potential, etc.) but looking back, there is no way I would have landed this role without getting "taking a step down" from my cushy lending role (and getting shafted in the process lol).
I guess what I'm trying to say is that 1) the grass is not always greener on the other side and 2) don't let that fact steer you away from your "dream job", because even if it doesn't pan out the way you expect, it's still probably a step in the right direction.
Anyway, just my two cents - feel free to PM me if you have any questions!
Laudantium id corporis adipisci ab quaerat non nam et. Aperiam dolorum sapiente sequi sed debitis quaerat voluptatem. Necessitatibus et autem et ducimus. Et ut sint voluptatum amet eaque nesciunt.
Et quisquam eos est vero qui. Rem earum et quis quia dolorem quos vel ut. Ducimus molestiae odit eius iste. Suscipit fugit officia accusamus alias. Qui assumenda repellat quas ut qui officiis. Dolore porro eos placeat. Eaque et mollitia dolor ut pariatur veritatis sit autem.
Dicta dicta vitae doloremque consectetur dolorem odio et vel. Est et error ea amet quam qui. Soluta ea molestiae neque vero molestiae occaecati architecto.
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...