Commercial Real Estate Job Offer - Is this normal? Is this salary typical of a new CRE associate?
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[{"id": "g9fyryu", "text": "Not sure if that is typical on the brokerage side, but think about what you wanted 8 years ago and how that is different today.\n\nSounds like a long lockup, but are they really going to spend the money to come after you for those HEFTY amounts you didn\u2019t pay?  I would just think going to a direct competitor is off limits.", "replies": [{"id": "g9i2opo", "text": "Those are impossible to enforce.  Don\u2019t worry about that dog shit.", "replies": [], "depth": 2}], "depth": 1}, {"id": "g9fz0nh", "text": "Sounds pretty terrible to me.  A contract where they think you would be paying them if you breach is a definite no.  Who the hell knows whats going to happen in eight months, much less 8 years?  However, the job market isnt great, so if you can take the starting role without the long term commitment, I'd understand", "replies": [{"id": "g9gc4pd", "text": "I like the contract, the 8 year contract is what freaks me out", "replies": [], "depth": 2}], "depth": 1}, {"id": "g9fzfnk", "text": "Define \"Hefty\" please.  \n\nIt seems pretty sketchy.  Many brokers live in their car while the try to get their first big payday so that seems like a solid salary for someone starting up.  I know people who worked day one on only commissions and also had to pay their own desk fee.  \n\nBut more than likely you will send 6-12 months cold calling and then want to do something more fulfilling with your life so you don't want to be tied down too strongly.\n\nMaybe this is your first test... show you can negotiate a contract.  and do so respectfully (negotiate the terms over the phone with them first and not through email.  And then send them a red line of the agreement).", "replies": [{"id": "g9gaupb", "text": "If I work and am mentored by them for a year, then decide to leave before the 8 years is up I will be obligated to pay $200k to them in liquidated damages.", "replies": [{"id": "g9geih9", "text": "That... does not sound right at all", "replies": [], "depth": 3}, {"id": "g9govq4", "text": "I doubt that is even legal.  8 years is a long long time!  What if the person you are working for dies? lol", "replies": [], "depth": 3}, {"id": "g9m8zjy", "text": "So, they are claiming that their training/mentoring program is worth $155k for the first year ($200K minus your salary)?! \n\nWhat are they offering that is so exclusive to their training program that no other CRE Broker offers (including JLL, KWCommercial, Endeavor, Aquila, or even other smaller shops in the area) that makes them demand 8 years of your prime or pay them a HEFTY penalty? \n\n$200k is what, 5-6 semesters at an Ivy League? They believe their training &amp; mentoring is worth as much as 3 years of Ivy League education?! Especially being a local brokerage, not a national or even state-wide brokerage...hmmmm.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g9fzy58", "text": "It's basically a preemptive non compete, with a cash penalty. \ud83d\ude02", "replies": [{"id": "g9gaovr", "text": "Exactly", "replies": [], "depth": 2}, {"id": "g9ggk5o", "text": "Well said. Non competes can be hard to enforce depending on the state. This seems like a work around.", "replies": [{"id": "g9iamen", "text": "It\u2019s Texas. They basically still allow slavery there.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g9g1463", "text": "Not typical. Run away.", "replies": [], "depth": 1}, {"id": "g9g17uz", "text": "Seems really shitty. Any corporation would pay you $50k to $60k for starting as an analyst.", "replies": [{"id": "g9gc26h", "text": "The salary doesn\u2019t bother me too much. I know I\u2019ll make more money after the training period Is over but it\u2019s the length of the contract.", "replies": [{"id": "g9gdad1", "text": "I agree. It is too long.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g9g34v6", "text": "Yeah man, that's terrible.  \"Hefty\" amounts of training are included in any reputable program,  and you aren't being paid a salary by the time you're a broker anyway.  They make more when you make more so your broker should have clear incentive to train you.  I see no way in which this contract benefits you.\n\nEdit:  The salary is fine and right in line with what you might see in an analyst role at the blue chip shops", "replies": [{"id": "g9gbxyd", "text": "The 8 year contract is the only thing really holding me back. Such a long period of time", "replies": [{"id": "g9ge4p5", "text": "Ask them for clarification on why it\u2019s so long and what your restrictions are.  You should be able to tell pretty quickly what their motives are,  I\u2019m very curious about this so report back if possible.  Good luck", "replies": [{"id": "g9ge9h6", "text": "They do it so the larger companies in Austin don\u2019t come in and try to take business from the smaller niche market that we are currently in. \n\nIt makes sense and I see why they do it but i can\u2019t commit to that right now.", "replies": [{"id": "g9h385o", "text": "That is not why they are doing it. The larger brokerages already are working those markets, assuming the market is worth a damn. Hell I had one multi-family team in my office in DFW that had three different guys hitting tertiary markets exclusively. And we had 4 multi-family teams.\n\nI know a lot of brokers, was one for 5 years, and now work with them daily. I have never heard of anything remotely close to this. One possibility is you are misreading the contract and the $200k is a draw available that you would have to pay back if you left without earning enough to cover it. (a draw is basically a commission advance that gets paid back as you earn) But the 8 year thing is still weird as hell.\n\nIf it is not a draw, I would RUN in the opposite direction. Any brokerage who tries to tie you down with a repayment obligation isn't worth working for. The splits/pay/benefits of working for the brokerage should be enough to keep you from wanting to go elsewhere, not a contract obligation. \n\nMarcus and Millichap used to pay $2k/month for their Sales Intern Program for the first year, plus 25% of commissions (negotiable of course, like all compensation in Brokerage). I would assume many other shops have the same thing, granted idk how many are hiring with the slaughter that is starting/coming. \n\nIf you need the money up front and can't float yourself until you start hitting commissions, I would suggest getting on somewhere as an analyst for a year or two. Will help you ride out this shit storm and learn the most important part of the deals anyway. I would double down on this advice with your statement of being Ivy League. You should be doing debt underwriting at HFF/JLL or CBRE for 4 years, then shifting into an acquisition position at a REIT or wherever you can land a mid-executive title for a while, then opening your own shop or partnering with someone else raising equity.", "replies": [{"id": "g9kjo49", "text": "u/jawnies I'd agree with this assessment.  If it truly is a niche market, there's also no guarantee it will even be profitable or cutting edge in eight years.  Hell, look at self storage or mobile home parks - if you got in eight years ago you'd be rolling in dough right now.  While it might be considered \"niche\" it's now far more stabilized and everyone's doing it. \n\nI used to live in Austin and have friends at Endeavor, JLL, and Walker &amp; Dunlop.  Feel free to PM me if you have specific questions about the company you're talking with and I can probably get you some insight pretty quick.", "replies": [{"id": "g9kml2n", "text": "I appreciate that, I'll make sure to reach out if I have questions!", "replies": [], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g9g4c8q", "text": "You are only 22, don't lock down your life for the next 8 years. That's crazy, you are just beginning your adult life. They may be successful but that doesn't mean it is a good place to work, something is odd to require a contract that equals nearly 1/3 of the years you have lived so far on this earth. No salary or on the job training is worth that when there are so many other options to explore and places to live.\n\nI'm a Native Texan, Central Texas is great and family is there, but I would never lock down 8 years there with a huge financial penalty -- that area is changing so much, so drastically, so fast. What is commercial real estate just plunges and there is simply no work? What if you hate the people you work with? What if you fall in love and want to move to get married?", "replies": [{"id": "g9gbubk", "text": "All great points. The more I think about it the more I realize 8 years is a very very long period of time, add on the fact that I\u2019m stuck with no real way out. Kind of terrifying.", "replies": [{"id": "g9gpamb", "text": "If they actually want good people, either they must negotiate that lower or drop it.  I can't imagine even trying to lock someone up for 8 years.  Things change, people change, it's not realistic.", "replies": [], "depth": 3}, {"id": "g9gxu0z", "text": "It should be terrifying to you. What they are doing is preventing you from quitting for 8 years unless you pay them to release you -- they could be the shittiest company around, but it wouldn't matter -- they would be controlling your entire career for just shy of a decade unless you cough up major cash. You can't go to a competitor or even a different industry without paying them to release you. I guess it's legal, the way they structured this, but no thanks.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g9g52zs", "text": "8 year contract? Never heard of anything remotely close to this, run", "replies": [{"id": "g9gbpge", "text": "Might have to", "replies": [{"id": "g9io84l", "text": "run...run.......go....go.....get.......", "replies": [{"id": "g9io8j3", "text": "RUNNN", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g9g7hkc", "text": "Look into CBRE, Jones Lang LaSalle, and/or other national commercial brokerages in the area and see what they offer.  As someone that has worked in commercial RE for years, what they really provide that is most valuable are the leads.  The training does have some value, but you can certainly educate yourself.  The back-office support is nice, but in todays world you can hire your own freelancers to do most of the back-office tasks for a minimal amount.  What you will have the most difficulty getting are the leads.  Working at a larger firm can help you build a network of leads and a reputation that will lead to the opportunity to springboard elsewhere or on your own if you choose.", "replies": [], "depth": 1}, {"id": "g9g8x27", "text": "No way in hell would I sign an 8 yet contract with an unknown (to you in terms of how you will feel with them) company. \nNo. Way. In. Hell.", "replies": [{"id": "g9gbkpf", "text": "Very true. So much left in the unknown.", "replies": [], "depth": 2}], "depth": 1}, {"id": "g9g93z2", "text": "Skip all day.\n\nYou can get that salary anywhere. Granted, the labor market is softer than it was before COVID.\n\nThe long contract with buyout is crazy.", "replies": [{"id": "g9gbj0m", "text": "Yeah that\u2019s what bothering me. I really don\u2019t want to commit somewhere for 8 years with no way out.", "replies": [{"id": "g9gdv52", "text": "Hell no", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g9gd933", "text": "I'm left scratching my head on this. Something seems wrong, the best suggestion I heard was to push back - perhaps it really is an opening position to see if you have the tenacity to strongly question something that doesn't make sense from anyone's position. CEO's don't get a tie-up this long, would they really want to hire someone who would say yes to this? Maybe consider this as an opportunity to call other shops, explain your situation, and find out how they would approach. Might be a good networking opportunity.", "replies": [], "depth": 1}, {"id": "g9gdq0x", "text": "Not normal", "replies": [], "depth": 1}, {"id": "g9gemdr", "text": "Best to clarify what the heck is going on.\nNo normal company operates like that", "replies": [{"id": "g9gexy4", "text": "I\u2019m hoping that I\u2019m just supremely bad at reading contracts!", "replies": [], "depth": 2}], "depth": 1}, {"id": "g9ggt3z", "text": "Its not that hard to become a commercial broker. Some of them can barely read a P&amp;L. All that matters is your ability to close deals. Go with a different firm", "replies": [], "depth": 1}, {"id": "g9goqds", "text": "That's all nuts. If you have an attorney friend you can run the contract by you should. I seem to recall slavery has been made illegal.", "replies": [{"id": "g9h50dy", "text": "Hahaha", "replies": [], "depth": 2}, {"id": "g9nfwtq", "text": "Slaves at least got room and board.", "replies": [], "depth": 2}], "depth": 1}, {"id": "g9gpyc9", "text": "Way to long for a non-compete.", "replies": [], "depth": 1}, {"id": "g9gtgjq", "text": "Worry first about the commission splits. If you become a broker and you are not netting anything for the first two years commission wise and are just giving senior brokers deals, your getting ducked, period. Also, please go interview at 5 firms. You are an ivy league grad, they will all take you, that IMO is just not a good offer especially if their locking you down for 8 years.", "replies": [], "depth": 1}, {"id": "g9guezv", "text": "Horrible deal, an 8 year lock-up for a new grad? Bail fast. Especially from a brokerage - after your first 2 years it's likely 100% commission so if you find out their success is all based on the relationships of senior brokers and you struggle to produce, you're extra fucked because then you either starve or go into debt to pay them for training?\n\nWhat companies nowadays require you to pay for training? That's absurd.\n\nGet out. If you want to do brokerage, target CBRE, Eastdil, JLL or C&amp;W. Otherwise target a local developer or fund. You're an Ivey league grad, you'll get interviews at much better places.\n\nEDIT: On a side note, salary is okay depending on the market. In Dallas or Houston should probably be more in the 55-65k range.", "replies": [{"id": "g9h5bet", "text": "Thanks for the info, I\u2019ll look into those companies. Definitely not in any rush at the moment.", "replies": [], "depth": 2}], "depth": 1}, {"id": "g9gy4t3", "text": "Demonstrate to them your negotiating abilities", "replies": [{"id": "g9h5dbm", "text": "And I will when I meet with them tomorrow morning!", "replies": [{"id": "g9m7i82", "text": "How did it go?! Don't leave us hanging!", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g9hhtzz", "text": "Hey man, please don\u2019t do this to yourself. 8 years is an eternity. Don\u2019t buy the training BS. They are unlikely to do you many favors. More than likely you will be the canvassing guy / general gopher until you get sick of doing that and want in on the deals. They know this too which is why they are trying to take advantage. Unfortunately unethical dealing like this is rampant in CRE. \n\nBe sure that it\u2019s salary, and not a draw, too. You may have to pay ALL of it back. If it\u2019s a draw, then you should be able to get a better deal at any shop (similar money probably but without all the restrictions).", "replies": [], "depth": 1}, {"id": "g9hku7p", "text": "Dumbest most predatory sh\\*t I have ever heard. Why is finance filled with so much douchebags?", "replies": [], "depth": 1}, {"id": "g9hoyng", "text": "Run", "replies": [], "depth": 1}, {"id": "g9huuji", "text": "You\u2019ve got to share the firm name.", "replies": [], "depth": 1}, {"id": "g9hv8sg", "text": "Um, no. Pass on this \u2018opportunity\u2019. It sounds like a scam, tbh.", "replies": [], "depth": 1}, {"id": "g9hx35q", "text": "For a CRE thread it\u2019s funny no one suggested that you can negotiate the terms \ud83d\ude11", "replies": [{"id": "g9hxts0", "text": "Lol I\u2019m going to be doing that here soon. Fingers crossed", "replies": [], "depth": 2}], "depth": 1}, {"id": "g9i1411", "text": "Go to a big city.  You\u2019ll learn three times as much, three times as fast, and probably for free with no contract.", "replies": [], "depth": 1}, {"id": "g9i2gvp", "text": "Good luck to them trying to collect that fee if you leave.", "replies": [], "depth": 1}, {"id": "g9i3uic", "text": "Why are you going into brokerage as an Ivy League grad? REPE or development will not have an 8 year non-compete!", "replies": [], "depth": 1}, {"id": "g9i82p0", "text": "Stay the fuck away. If you\u2019re an Ivy League grad I\u2019m sure there will be better opportunities, just wait it out, take your time, and continue to network.", "replies": [], "depth": 1}, {"id": "g9ii4he", "text": "Do not sign! Never sign a bullshit ass non compete", "replies": [], "depth": 1}, {"id": "g9io4m1", "text": "Fuck that", "replies": [], "depth": 1}, {"id": "g9iqdzt", "text": "An 8 year contract is what you get if a big brokerage acquires your local company and they need you to run you hard (but you probably won't be put away that wet because you were already decently rolling in it)\n\nlol people aren't roasting you hard enough for this. \n\nDid mom &amp; dad get any kickbacks on the wing they donated to get you into a top tier college? I hope so because that investment is not looking great", "replies": [{"id": "g9j05va", "text": "Mom and dad didn\u2019t pay a cent, I played 2 sports in college. Don\u2019t think the school regrets it\u2019s investment in me one bit ;)", "replies": [{"id": "g9ml19y", "text": "Haha well. I made a joke about how you were acting so dumb your parents had to pay for you to get into school and you responded with \"actually it was sports,\" so that's not great.\n\nLucky for you brokerage loves athletes (football, baseball, rowing, maybe soccer) but that could also make you a flashing target if you're not coming from a situation where your parents are not kicking you in the butt to punt this off your plate\n\nSo those are my thoughts on this offer \ud83d\ude04", "replies": [{"id": "g9my430", "text": "....\u201dit\u2019s not great\u201d that I was able to earn a division one scholarship in not one but TWO sports, while also having the grades to gain admission to an IVY LEAGUE school? \n\nI really hope you\u2019re kidding hahaha. Regardless, I appreciate the advice, have a great rest of your week!", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "g9j510l", "text": "On other item is look into brokerage on asset classes that are actually in favor, ie Healthcare/MOB/ Industrial (tenant / landlord rep) or multifamily investment sales.  \n\nRetail and office are going to have a very difficult next 3-5 years, all the cold calling in the world can't fix their problems.", "replies": [{"id": "g9j6r78", "text": "Do you think that was going to happen organically or did COVID make that happen?\n\nThank you!", "replies": [], "depth": 2}], "depth": 1}, {"id": "g9jmsfw", "text": "I'm in San Antonio, and we have a large Austin office. I'd be pretty concerned about A) there being term on the employment contract and B) that there is a salary and bonuses, not commission-focused early on. Is this for brokerage and do you know the broker that you would work under? The top groups wouldn't structure it like this.", "replies": [], "depth": 1}, {"id": "g9jn8cz", "text": "Wow. I know others have largely already posted this, but I am truly astonished.  \n\nThis company should be investigated by the state labor department. That is an insane contract. I've literally never heard of something worse. \n\nSounds like someone who is dealing with high turnover or got burned in the past and instead of being a better place to work, they are being punitive to new hires.", "replies": [], "depth": 1}, {"id": "g9n6dk1", "text": "I will be graduating next spring and I'm also going into commercial brokerage. If I had that offer I would decline without hesitating, 8 years is absurd.", "replies": [{"id": "g9nam71", "text": "Congrats on graduation soon! Very big accomplishment but yes you\u2019re right about that.", "replies": [{"id": "g9nigl3", "text": "PM\u2019ed you", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}]