Private Real Estate
Annual Compensation Survey

Covid impact is over for private real estate compensation

Wage inflation for juniors and a return to growth for seniors are among the key takeaways of this year’s compensation report conducted by PERE and executive recruiter Sousou Partners, writes Jonathan Brasse.

It is a case of going from headwind to tailwind when it comes to the forces impacting compensation in private real estate these days. Between 2019, when the first strains of covid-19 were detected in China, and today, as working amid a pan-demic normalizes around the world, pay in the industry has boomeranged.

As market practitioners repopulate offices and travel bans ease, capital deployment and raising volumes have returned to or surpassed pre-pandemic levels. According to broker CBRE’s data, global commercial real estate investment soared to $1.3 trillion in 2021, 55 percent more than 2020’s total, which was 30 percent lower than in 2019. As per PERE’s private fund-raising research, the $175.73 billion raised for closed-end funds in 2021 was almost 14 percent higher than in 2020. That year’s total was 17 percent down on the amount raised in 2019.

As a result of this bounce, managers have looked to ramp up headcounts to take advantage of the deals stemming from the pandemic. Consequently, the general malaise in individual pay growth in 2020, with instances of no bonuses paid, turned into a remuneration environment supercharged by firms competing for talent.

Published on – PERE • April 2022