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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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Suzanne Robitaille, Salary.com Contributor
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