How much in sales volume does an average CRE broker do?
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[{"id": "e3jetyg", "text": "Exactly like you said, all depends on location...and the amount of work the broker wants to put into it. Just because you work in a hot market does not mean you will make money. You still need to make the calls, create the relationships, and work from there. In the DC area, we typically get paid 3% on sales as the tenant rep. ", "replies": [], "depth": 1}, {"id": "e3jjw6l", "text": "Asset class is another variable. ", "replies": [], "depth": 1}, {"id": "e3kac83", "text": "Average is 3%, every once in a while you can get bosth sides of the deal so 6%, but sometimes that is negoitiated down to 4%. Top brokers in my city probably average $10-$15million a year and probably on an average of 3.5%. so they make $350K-$500K deponding on the split with the house, in bigger firms is 50/50 but smaller firms is 60/40 or better.", "replies": [], "depth": 1}, {"id": "e3kcozv", "text": "What is your average year? This is the top of the market. If you think next year and all years will be like this year, you are dumb. \nOur desk costs are about 400K. Which means if you make less than 400K you cost the company money. Your average broker probably makes less than that. I have seen people go three years without a deal. I also know brokers that do a deal every three weeks. It depends on if you are selling multimillion dollar development deals or if you are doing NNN retail. \n\nMy most successful brokers probably do about 200-500 million a year in total transaction value and take home about 2-5 million. \n\nOthers make less than their admins. It depends on where you work, who you know, ect. \n\nIf you are doing 5 million in transaction volume at 1.5% commission, that is 75K, not so bad, but well below your desk cost. ", "replies": [{"id": "e3rxvbu", "text": "How can the desk costs be 400K? That seems really high? You could have a full time dedicated employee making $100k working just for you and still have more than enough to cover rent, software, marketing, etc.", "replies": [{"id": "e3s9498", "text": "You have to cover rent, E&amp;O, marketing, research ect but yeah, I get you. I am sure that the actual numbers are lower, but our region made 62 million last year, the analysts expect 72 million this year which means your average broker needs to bring in 400K to meet those goals. \n\nAnd that is gross, not net. The actual desk costs for your tenant rep broker is way less than your star agency leasing team. Fuck those guys.   ", "replies": [{"id": "e3sj7fj", "text": "I can see wanting every broker to hit $400k to hit their goals. But that is very different than the cost of a desk to the company being $400k per person per year. Either the support staff must be massive, or those costs are overinflated, or the office is just run really inefficiently. I don't know how you could even stay in business if $400k per person in come is the break-even point.\n\nSorry, not trying to be mean, I'm just fascinated if that actually is the business model.", "replies": [{"id": "e3spqtg", "text": "Yep. You ever look at the 10K for a major commercial brokerage company?  \n\nLooking at our 2017 statement, we had 3,900 brokers to about 2,400 staff. We did about 2.2 billion in revenue. That is about 583K per broker of money coming in. The cost of that is 1.4 billion in commissions &amp; rent and other expenses, 613 million in salary, 26 million in depreciation, 14 million in interest, 63 million in taxes, ect. ect. \n\nAt the end of the day, out of that 2.2 billion in commissions, what is leftover is about 49 million leftover in earnings, or about 1.13 a share.  \n\nSo, yep, that is our business model. \n\nI am overhead, part of that 613 million in salary. A small part, but still a part. Probably around half of that 2.2 billion is comissions, so that means that rent ect is about 300 million. \n\nSo each year, we need 300 million to keep the lights on, and another 600 million in salary ect ect. So lets make that a cool billion. Brokers don't work for free, so lets say that is a 50/50 split, so double that to two billion to stay afloat. \n\n2,000,000,000 by lets say 4,000 brokers, that is about 500K needed by each broker to make ends meet. \n\nTake a look at the annual statements for CBRE, JLL, or any publicly traded CRE firm and you will see how much it costs to put a sign on a building and wait for the phone to ring. ", "replies": [{"id": "e3sqct6", "text": "Very interesting breakout. $583k average is a healthy number, especially considering some of those 4000 brokers have to be bring in much less, are junior brokers on a team, etc.\n\nThat being said, if you are pulling in $583k, it's surprising that you couldn't bring that much money in with $300k in support instead of $400k in support?", "replies": [{"id": "e3svm8k", "text": "Some of my best brokers have $0 in support, and some of my worst have a 5 person team and their own office. It is really unfair. ", "replies": [], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}]