as Real estate loves US dollars, but people tend to keep quiet about the salaries that players take home. real We sifted records and shook the vines to find out what the business could do from the bottom of the corporate ladder to the top.
T.The median president or CEO of a real estate investment trust holds the industry’s most profitable position, earning $5.95 million last year, according to an analysis of compensation data for 150 publicly traded companies. Earned. This is up 17% from 2020, with most of the increase coming from increased bonuses. In 2021, the CEO’s salary rose by only 2%, but his bonus compensation rose by 42%. CFO achieved about the same increase.
P.Hamid Moghadam, CEO of rologis, has become the king of REITs during the pandemic, making him the most funded REIT CEO or president in the past two years. Moghadam earned $24.9 million last year. That’s less than the $34.4 million he pulled back in 2020 when his particular sandbox, Last His Mile Warehouse, saw a huge boom. He can attribute most of his profits in both years to stock bonuses. Shares awarded to Moghadam in 2021 would make him worth $22.3 million at the time of the grant, and Prologis shares jumped 69% last year.
S.Tock is nice, but like retailers tend to say, people want the experience. Last year, Vornado’s executives reportedly spent $750,000 on cars and drivers for four executives, so they’re clearly playing a game. Founder and CEO Stephen Ross made $9.8 million last year, but Ross’ salary is even less fixed than most. For the past three years, he has earned his 80% of his salary in stocks, and his 98% of last year’s compensation came from REIT performance. Vornado’s share price is down about 50% since early 2019.
〇Last year’s big earnings included SL Green Realty CEO Marc Holliday ($21 million) and Boston Properties CEO Owen Thomas ($12.9 million).
L.After companies spent much of 2020 debating not only how to survive, but how to reward executives without creating a PR nightmare, last year was the year of a return to normalcy.
“In many cases, salaries have been temporarily cut, perhaps by as much as 50 percent,” said Rami Glatt, principal at compensation consultancy Semler Brossy. “The more you pay, the more risk you take.”
S.Some executives argued that despite the sharp drop in revenue early in the pandemic, they performed well given the circumstances and saved the company from a worse fate.
N.Anyway, that salary doesn’t mean much to real estate management. The majority of executive compensation is provided as long-term equity grants that vest over years rather than months. T.Anthony Malkin, CEO of Empire State Realty Trust, said: Last year, his total compensation was $7.9 million, of which he was paid only $626,000 (less than 10%).
L.Eslie Hale made history in 2018 by becoming the first black woman to lead a public REIT. Her CEO of the RLJ Lodging Trust, where she owns the hotel, had her base salary of $840,000 last year, but her total compensation, including her long-term equity, was $16.3 million.
aSalary accounted for just 13% of the median compensation of publicly traded CEOs last year. To get to the real estate boardroom, you need a stomach for risk. But even Vegas card sharks could fold at these odds.
aSome companies have their executives tied up in gold handcuffs. Exact ratios vary, but most leaders should keep a multiple of their base salary in stock. Howard Lorber, CEO of Douglas Elliman, whose salary last year was his $3.4 million, has put his Elliman stock, which has fallen about 50% since his IPO on Dec. 30, at least three times that of his. You must hold the amount. However, Lorber also includes a car and driver, a club membership, and the use of his private jet of up to $200,000.
P.Loptech companies are facing a special crisis due to the stock market crash. To compete with Silicon Valley for talent, some companies have followed in technology’s footsteps and paid their younger employees stock. It’s great for employees when stock prices are high, but when stock prices plummet, This year, all proptech companies — may be left to cover the difference between the promised amount and the actual value of the stock.
R.Real estate firms tended to use a discretionary model to determine executive compensation, giving them options to get creative even as the pandemic disrupted their businesses. But that volatility could have a downside as the economy shows signs of slowing.
“I am a shareholder, and to some extent I expect that if I suffer, you suffer too,” Glatt said.
B.locker building bank
aAmong brokerage bosses, Elliman’s Rover is hard to beat. His bonuses and post-grant compensation reached $32 million last year. , overwhelmed its competitors. The company’s co-founder and CEO received $89 million worth of stock last year, but both he and his Lorber have seen the realization value of the stock drop dramatically over the past year. rice field.
〇Commercially, Howard Ratnick has been rewarded with a career in 2021. After a record year, his CEO of Kantor Fitzgerald and chief of Newmark received his $50 million bonus once he was due to be paid out over four years.he took home first $20 million However, to receive the remaining $30 million ($10 million paid in three installments), he must remain in his current role as CEO and Chairman.
C.BRE CEO Robert Sulentic earned just under $13.9 million last year, while Cushman & Wakefield Executive Chairman and former CEO Brett White took home $19.9 million.
T.Executive suites are comfortable, but really, how much is a broker’s bank account? More than any other job in real estate, it depends on how hard they work.
M.ore than 150,000 Americans Became an agent in the last two years, TV shows and Masters of the Rise and Grind have portrayed the profession as a path to wealth. agents are facing a difficult situation.
B.A listing is required before agents surrender half of their earnings to brokerage fees. To get a head start and build their network, early-career agents are increasingly choosing to join brokerage teams within agencies.
cormorantUnder the umbrella of the team, new agents still have to give the broker and the team a cut, but until they get a steady deal flow and have the connections to generate their own, a profitable Take on the low list. For most people, it’s not the “selling sunset” lifestyle.prepayment company RLTY Capital backed by Ryan Serhant fledgling agencies have often built their entire business around the proposition that they don’t have the cash they need to pay bills or grow their business.
aAs agents close more deals and reach a certain level of deal flow, they can negotiate better splits with brokers. If they hit the sales stratosphere, they can withdraw up to 90%, perks like assistants, all expenses paid. Vacation and chauffeur service.
M.contact ost agent TRDs They declined to discuss their split or income, but for a rough estimate we can do the back-of-the-napkin math.
T.Douglas Elliman’s Eklund-Gomes team was Manhattan’s biggest seller last year. TRDsannual of New York Housing Elite RankingsThe group has sold at least $492 million worth of properties in the district. This equates to $9.8 million to $29.5 million in fees for him. If the team kept half of it after splitting with the buyer’s agent, a 70% split would leave them with $10.3 million. The team did not respond to a request for comment, but even that rough estimate leaves plenty of room for the team’s piece of the pie with operations in Florida, California, and Texas.
T.The Sabrina Saltiel team at Elliman, Manhattan’s 10th largest seller, closed deals worth $208 million last year. From $4.2 million, she could earn $12.5 million, depending on the commission percentage. After a split-and-split split, Saltiel’s team could walk away between $1.5 million and her $5.6 million before marketing and other expenses.
T.Aaron Kirman Group, which generated at least $1.3 billion in sales in Los Angeles over the past year, took the lead. TRDsof LA Agent RankingKirman Group, an affiliate of Compass, could have generated between $20 million and $41 million in commissions, assuming a 50/50 split with Buyer’s Agent. With a 90% brokerage split, that could be as much as $36.5 million. Around the same time, Tami Pardee sold her LA estate worth $841 million. Assuming a fee of her 6%, it could generate up to $25 million in fees before the brokerage splits. Compass’ Malibu superseller Chris Cortazzo hit his $705 million in sales last year. This could mean up to $42 million in fees between the buyer’s agent and his Compass.
B.Things can change, especially for luxury agents.
aAfter selling luxury apartments in Corcoran for 16 years and setting up her own brokerage, Louisa Gillen still can’t believe how much her agent makes selling luxury goods. With her new company, Simple Real Estate, she plans to change that.
R.Regardless of the price range, real estate agents generally charge a commission of 4-6%. Even at the highest price tier, it is unlikely that agents on either side of the deal will get below her 2%. Even though prices and commissions have increased, the agent’s essential job remains the same: coordinating shows, setting list prices, and negotiating deals.
G.Yren and high-ranking agents growing crops, especially Zach and Cody Vichinsky of Bespoke Real Estate The Hamptons are cutting high-end agency commissions radically in what they call a long-term realignment. Announced that they will charge a 1% fee. On Simple, where listings range from $900,000 to $10.5 million, Gillen caps commissions at $50,000.
“At a certain price point, you’re simply overpaying,” she said.
G.Iren recently sold a studio apartment that belonged to her friend’s grandmother. The windows of the unit face the walls and it took months from the time we dealt with the boards to the time the sale was completed. Gillen says the deal only made her $1,000.
aAround the same time, she sold her $5 million Tribeca loft, describing it as a relatively painless experience. A building neighbor showed up at her first show and bought a condo all in cash.
S.He says selling his grandmother’s studio was a much bigger ordeal than his Tribeca condo. “On its high end, it’s meticulously finished. It’s usually in the best location and has the best views,” he says Gillen.
〇The difference between 1% and 6% in commissions can add up to millions of dollars when you start selling Palm Beach or Central Park penthouses around the world. If their strategy works, sellers like Bespoke and Simple will cut competition and force other sellers to slash their fees if they want to compete for the listing. Ultra-luxury buyers are the least price sensitive, but they’re also not the type to leave cash on the table.
“Who wouldn’t negotiate that as a seller?” Gillen asked.