Suzanne
Robitaille, Salary.com
Contributor
No bones about it, said Kevin Hanna: Working the kitchen grill
at his grandfather’s steakhouse in Framingham, Mass., as
a teenager helped him to launch a successful career in the real
estate business.
Hanna, 36, has
since traded in a greasy apron for a white shirt at Cushman &
Wakefield of Massachusetts, Inc., a commercial real estate firm
in Boston where he cooks up deals with some of area’s most
cutting-edge companies.
He negotiates
leases for retail, healthcare, high-tech, and other industries that
are seeking office and industrial space in Boston and greater New
England. He represents both landlords looking to market office and
industrial space and tenants looking to relocate or expand.
“My experience
at the restaurant taught me social skills, how to provide good service,
and certainly a good work ethic. We often worked long hours,”
said Hanna, who has been working for Cushman & Wakefield more
than 12 years.
Like 80 percent
of those in his profession, Hanna is paid in straight commission
– cashing out only if he closes the deal – which makes
commercial real estate brokerage a risky business. Without the security
of a paycheck, brokers usually rely in their first years on a “draw,”
or money paid in advance of future commissions.
Brokers cannot
expect to make too much money in the first few years, Hanna said.
It takes four to six months to complete a transaction, so a broker
“needs to have a lot of irons in the fire to build up a book
of business.”
Most brokerage
houses split the profits 50-50 with the broker up to the first $350,000,
with five percent increments to the broker as production increases
throughout the year. The slate is wiped clean at the end of the
year and returns to a 50-50 split.
After four or
five years, brokers should be making at least $100,000, said Hanna,
who has pulled down a salary in the high six figures for the last
few years.
“It’s
a great job because you really control your own destiny. Your income
is directly related to your success in the business,” Hanna
said. “The sky’s the limit.”
One of Hanna’s
most interesting and successful deals was the Watertown Arsenal
project, a historic, 200-year-old building near Boston that the
U.S. government once used to build armaments. In 1998 he helped
secure the rights to redevelop the space, which his firm now
leases for a hefty $34 to $40 per square foot, excluding utility
fees. Several clients now rent out about 200,000 square feet,
for about $7 million in rent.
Brokers’
pay usually depends on market conditions, not years of work experience,
said Al Marco, a partner in Joseph Chris Associates, a national
recruiting firm in Chicago that specializes in placing commercial
real estate executives. At the low end, a commercial-side broker
like Hanna can expect to make between $70,000 and $100,000.
In a successful year, he or she can pull down between $200,000
and $500,000, Marco said.
The risks of
the commercial real estate business are certainly offset by financial
rewards, and Hanna said he also appreciates the job flexibility
and opportunities to go out and meet his clients. Although he
works up to 60 hours a week, he spends some of that time away
from the office, touring his clients’ conditions and trying
to understand their corporate culture and what kind of office
or industrial space they need to operate.
“You do
something new every day, you’re constantly meeting new people,”
Hanna said. “It’s a truly exciting business.” |
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