REPE Acquisitions Compensation- What’s a fair structure?
Anyone in private equity real estate care to shed some light on their compensation structure? I’m an acquisitions associate for a group that acquires a very niche asset type nationwide. My job is to source deals off-market.

Right now I’m paid a base salary + a fixed $ per property bonus that’s way under market. I’m responsible for 25% of our total $ acquisition goal this year and will have closed around $140MM in off-market deals by end of year. 

Was told we’re going to discuss my compensation for next year soon and don’t know how to structure it. Should it be base + % of total $ amount in deals? What’s a fair %? Any VP’s of Acquisitions care to share their comp structure? 

Thanks!
[{"id": "g7x5wxt", "text": "I\u2019m in a similar boat, out of curiosity, how old are you?\n\nI\u2019m lucky that my firm does not incentivize \u201cby the deal\u201d. In other words, they want us to find quality of quantity. My comp is a pretty solid base salary with performance bonus that is tied to the performance of our fund and AUM, not our acquisitions goals.", "replies": [{"id": "g7x8bfr", "text": "29. Been at this job for 2 years. Cleared 6 figures last year and will clear 6 figures again this year but I technically get paid the same for a $5MM property and a $80MM trophy asset... \n\nHow is your bonus calculated? What % roughly would you say bonus makes up in your all in comp?", "replies": [{"id": "g7x9q8t", "text": "Interesting. I\u2019ve been at my shop for 4 years. My base salary is in the low 6 figures and my bonus is usually around 35-40% of that but again - not dependent on acquisition volume. I also live in the northeast which is viewed as higher COL\n\nDo you get any carried interest?", "replies": [{"id": "g7xj4ek", "text": "No carried interest. I\u2019m in the midwest in a city people are flocking too. What\u2019s your shops AUM?", "replies": [{"id": "g7xjle9", "text": "We manage about $500mm of investor commitments, which is about $2B of real estate value, our assets are across the country.\n\nIf you struggle to renegotiate your salary or bonus, I would definitely push for carried interest.", "replies": [{"id": "g7xnaaf", "text": "I would be wary of carried interest in some situations. If you are in a niche where you could see major markdowns of debt, etc. of the deals you have carried interest in, you could be subject to a ton of taxes. \n\nI am looking at you, hotel and resort funds.", "replies": [], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g7xblwd", "text": "Do you work for a fund (private equity, investment manager, REIT) that is relatively institutional (this matters)? If so, make your way to Wall Street Oasis's real estate forum - you'll find plenty of resources and comp comparison. In short, your comp should look like at your level (associate, no clue on your years of experience):\n\nSalary: depending on experience and market, could range between +/- 50-80k. Higher if you work for a Blackstone-type in NYC/LA/London. Lower if you work in a tertiary market for a no name fund. \n\nBonus: +/-25-150% of salary. Lower band in tertiary market, higher band if Blackstone-type in NYC/LA/London. \n\nCarry/Promote: think of it as being given shares in the fund for i) your work performance and ii) investments' performance (usually IRR driven). Mostly given to employees when they become VPs and very much discretionary. Rule of thumb I was given in terms of how much $$$ you can make: you can buy yourself a nice house/flat with no mortgage in 5 years time (typical vesting period for funds). Entirely subjective on what nice means, where you live, etc. \n\nI'll caveat that, among other things, years of experience, proven track record, ability to originate, strong network, all affect your comp levels. \n\nI don't have a view on comp structure if you want to go down the commission comp way. You can have very good years and very bad years. Run then numbers and see what you can stomach. My guess is that you should have a few numbers in mind when you negotiate with your boss ranging from \"I'll be rich in no time\" to \"screw that I need to do X deals to make Y money\". The answer probably lies in the middle.", "replies": [{"id": "g7xkmd6", "text": "Great response. Yes, I\u2019d say we\u2019re institutional. Capital is 2 state pension funds and an investment manager like a LaSalle. Also have our own discretionary HNW fund. We\u2019re in a very niche asset class though and a smaller company. I\u2019m the first acquisitions associate they\u2019ve had who\u2019s job was to strictly hunt down and\nnegotiate off-market deals. What metrics are these institutional guys like Blackstone looking at when determining bonus? 25% to 150% of salary is a big swing.", "replies": [{"id": "g7z109h", "text": "Are you in a major or tertiary market? That's another factor. All-in comp will be notably lower in tertiary markets (more typically that 25% end of the bonus range).\n\n150% bonuses are uncommon and heavily dependent on both individual and fund performance ($ value closed, how prior acquisitions are performing i.e. are they on track to meet or exceed forecasts, etc.). You'd have to have an outstanding year on all fronts for something like that and even then you'd only see it in like an NYC, Chicago, etc. I'd say 75%-100% is a more \"average\" bonus range in major markets, 25-50 in tertiary.\n\nRegardless, it's VERY unusual for an associate to be sourcing anything but bottom of the barrel deals and usually their hand would be held the whole way through as they get trained to become a VP.\n\nIf you're single-handedly sourcing and closing on deals and are responsible for 25% of the funds targets, I'd be pushing for a promotion rather than a raise. That's well above associate responsibility.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g7xd6pg", "text": "Not sure, but do any of you all buy into LP equity private placements?  I have a few excellent new construction opportunities available.", "replies": [], "depth": 1}, {"id": "g7xmdd1", "text": "I recently interviewed with Carlyle\u2019s asset management team.  The comp I was quoted was $100k base + 60% target bonus.  My understanding of their acquisitions team is that it\u2019s $100k + 100% target bonus to start out.\n\nWhat is your comp currently?", "replies": [], "depth": 1}]