Everyone says you should expect not to make much money in your first year. What are some ways to “beat” this and make things work?
I’m a senior in college and actively looking to get into CRE, and I’m currently interning at a Multifamily shop. I know the saying that you should not expect to make money in your first year. Although I am very fortunate to have paid for college all by myself and have no incoming debts/loans, I do want to move out of my parent’s home and a bit closer to the city when that’s possible(my city is very large land-wise so I have long commutes). What are some ways brokers got around this predicament in the first year? Is it a matter of finding a part time job to make ends meet? Asking for a temporary salary/stipend for your first month or two? Any advice is welcome and appreciated!

Edit: forgot a word
[{"id": "g83vgeu", "text": "kinda doesn't work if you stay in a mf specific shop but a lot of office/ind/retail lease deals can happen pretty quick and busy brokers will gladly refer them if the deal value isn't high enough.  For example when an established broker lists a large shopping center for sale that is very much a deal they may not need or want you in, but if it has a 1500 sf crap space they have to list for lease they may gladly let you handle that.  Same for office blocks.  They will be glad to handle the 40k SF block in a building but that weird 800 SF cut out?  Step up and let them know you are glad to do that work.", "replies": [{"id": "g84r2u8", "text": "This", "replies": [], "depth": 2}], "depth": 1}, {"id": "g83xfcp", "text": "I tell young brokers to be prepared for it to take a full three (3) years to build a good pipeline but if you\u2019re just talking about making enough to get out of your parents\u2019 house that should be doable in a year. My recommendation to first year brokers is to focus on a very small area like a few blocks of a particular street and learn every building and owner...market knowledge is hard to fake and it\u2019s tough to learn your whole city quickly, but you can learn a few blocks fast. Another tip is to be willing to work holidays and other off hours\u2014being there to take the call when more senior agents are off. Speaking of which, finding a senior partner or team to \u201crun\u201d for is pretty key to success in brokerage.", "replies": [], "depth": 1}, {"id": "g840fvn", "text": "It takes time to build deal flow. If you started with an LOI for a lease on day 1, you are probably still 45-60 days away from seeing money in your account (and then learning the sad lesson of what happens when desk fees and splits are applied to gross commission). That said, some of the big shops will put you on a draw or small salary for the first 1-2 years to keep you afloat and prepare for transition to commission only. Whatever you can do to keep your overhead minimal is key to surviving the first couple years. IMO, try to avoid a scenario where you are relying on leasing as your primary source of income.", "replies": [], "depth": 1}, {"id": "g84ghyr", "text": "Honestly, it takes longer than a year.  Find the best way to live as cheaply as you can.   I cannot stress enough that it not only is tough to make money, but you spend money doing it.  You should absolutely get a job at night somewhere.  Something where the shift starts at 6:00 or so.  You will be working very hard the first couple of years.  Just accept that, put your head down, and grind.", "replies": [], "depth": 1}, {"id": "g85tx7n", "text": "Become a developer or syndicator. If you want to earn a lot of money, you have to break into the ownership side of the game.", "replies": [{"id": "g8871d7", "text": "as a college senior with no experience and no money?  I mean come on.  I'm all for that and is what I'm doing in my personal life but that route isn't realistic outside of seminars given op's resources", "replies": [{"id": "g89qzsr", "text": "Actually, that\u2019s not true. Start by vetting deals in the market, find one that makes sense, tie it up and raise some friends and family $. My senior year, I completed 3 value-add projects. The trick is to find a good deal, identify an opportunity, or identify an arbitrage. The market downturn will be your best friend, try and target some distress deals.", "replies": [], "depth": 3}, {"id": "g89r4xc", "text": "As for experience, don\u2019t pursue a ground up development. Instead try and identify a light value add opportunity. And hire experienced folks to execute your plan. You\u2019ll soon begin to gain experience.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g85yj87", "text": "Ask for a draw, which is only an advance on future earnings. The reason commercial takes (longer) than a year to get started is purely related to the deal life cycle. This is an unbelievably oversimplified explanation of a deal life cycle, but Lets use a tenant rep lease as an example: for conversation sake lets assume your managing broker hands you a secured tenant rep assignment day one (the reality of course is that it will take far longer to identify and secure a client),.\n\n1. from that point you have to define the requirement and put together an initial survey of properties. **1 - 2 weeks**\n2. identify a short list of properties and do an initial tour: **2 - 3 week**s depending on clients motivation\n3. assuming you found the perfect space on the first try (wont happen) you will undoubtedly tour the same unit 2 - 3 more times with various decision makers or operational folks with a say in the process: **2 weeks**\n4. once the unit is approved you will be drafting a letter of intent, once you write put the document together it can take anywhere from **1 - 4 weeks** to get client approval of terms and OK to submit.\n5. Submit offer\n6. once submitted the LOI will be negotiated, depending on the clients use, motivation and availability of alternative properties as well as landlords motivations, any other competing interest on the property and the intricacy/nuances of the offer (such as extensive TI packages) t can easily take **2 - 8 weeks.**\n7. OK so now you have an agreed upon LOI, which only constitutes the business terms under which the lessee and lessor will enter into a lease together. Using the absolute best possible scenario outlined here your already at 2 months. The reality of this process is that its going to take closer to 4 months, of not 6 to get to an executed LOI.\n8. Now were in lease negotiations and the attorneys get involved.... without getting on a soapbox about an attorney's ability to kill and/or delay a deal this will easily take just as long as steps 1 - 7 combined.\n9. CONGRATS YOU SIGNED A LEASE (closed a deal)! and it only took you 6 - 9 months\n10. Now you have to get paid. Each landlord is different, some pay immediately, others are shitty about it and take 30 - 45 days to cut checks. and remember you only get paid 50% upon lease execution (or 45 days after lease execution) and the balance when the tenant occupies and starts paying rent. This means that the remaining 50% can EASILY be delayed another 6 months (example: lease commencement is 3 months after lease signatures + 3 months of free rent).\n11. Using the formula you can see that a simple tenant rep lease wont be fully closed and paid for 12 months easily, often times longer.\n\nSales can happen quicker, but commercial due diligence periods are often times 60 - 90 days + 30 days to close, so assuming you went under contract on a building your first day on the job (and it didnt fall out for any reason) you wouldnt get paid until 4 - 6 months in.\n\nnow consider that the deals you work on as a first year broker are dog shit. The worst of the worst transactions that will pay you $10K if your lucky.\n\nAt the end of the day its simple math, you need to either build up volume (10 x $10K leases) or get lucky enough to big game hunt and find a high dollar transaction.\n\nNow, with all this said, if you find a good mentor and do the work you should be bringing home $100K+ a year by your third year.", "replies": [], "depth": 1}, {"id": "g88byjv", "text": "You aren't going to get a draw/temp salary in this environment, at least from what I am hearing from brokers I know. Maybe by the time you graduate COVID will have slacked enough for the staff hiring freezes to be lifted, furloughs to end, and firings to stop. \n\nI was an M&amp;M guy in a large office in a major metro. Made $30k my first year on one deal, $70k my second year, and somewhere in the mid $100k by my third. But during that time I also had two stretches of 9 months where I didn't see a penny. Saw a lot of guys make it and a lot burn out. The only ones that took off in their first year and made good money either had family listings/buyers to rely on, an extremely generous senior agent they were under that handed them some deals to cut their teeth (extremely rare), or they found a niche no one else was targeting and then worked their fucking assess off to learn it and tear into the market. \n\nAnd by work their asses off I mean one to two months of 12 hour days including weekends databasing and driving the hell out of their market to learn it followed by months of 200+ cold calls per week. It is all luck honestly, as much as brokers will never admit it, all about finding the right client at the perfect time. But you also make your own luck; easier to find that guy if you are calling everyone in the market every month. \n\nIf it were me, I would try and get in on the financial side first and cut my teeth underwriting while making a livable salary for a couple years to ride out the lack of predictability we are currently dealing with. Brokers are a dime a dozen, while brokers that know how to really underwrite a deal and understand it are more rare. That said, I also know Brokers who couldn't make money putting together an STNL deal in the CBD as their own investment and yet make half a million a year brokering.", "replies": [], "depth": 1}, {"id": "g8uwb3h", "text": "You must have a successful mentor. I was management for one of the top CRE brokerage firms for 15 years and those that excelled were nearly always juniors to a high level senior. Not only do you get the training, many smart mentors will give them a steady cut of their deals either as referral,commission, or bonus. Even better is an official internship under a senior because you do make something, even if it\u2019s min wage. But expect to work a minimum of 55 hours per week during that internship- it will feel like slave labor but you get a ton of benefits that can propel your career. \n\nDo your research carefully though with regard to leadership. Bad senior management can doom young brokers. And always negotiate commission contracts/read them very carefully- you\u2019re trying to be a broker after all.\n\nEdited to add: make the damn calls. 250 per week is expected for a junior- get ready.", "replies": [], "depth": 1}]