They asked me to be the Broker!?

[Agnafl]

My wife had a meeting with the owner of her Century21 office today and after several hours of her doing what she does best (tellin' it like it is) the owner asked her if she would consider becoming the Broker for the office He wants her to put together a proposal for a pay structure including bonus that would start immediately (this would start off as an office manager until she passes the brokers test in Feb). Knowing the condition of the market and what is to come over the next year, and the fact that she would be exactly what the office needs, she is considering it.

My question is this, What should she expect to be paid in the way of a salary + bonus as a principle broker of an office with 30-40 agents? I don't want her to lowball herself, but I don't want her to be unrealistic either. Looking for some insight from other brokers out there. If you would rather PM your response to me, feel free...

Thanks,

Matt

[webmaster]

Matt - is it not unusual for a Broker to be salaried? Normally is not the Broker typically the owner in an office that small? And don't they make their $ off the cut of commissions and or desk fees?

[Agnafl]

Yes, it is typical for the Broker to be salaried. It is all of the other compensation that was unclear. Expense accounts, bonuses, cuts from commisions and at what %, commision % for brokers' own listings, ect.. I was just curious to know how other offices/brokers were doing it. I have had 4 people respond via PM and there are some pretty complex/lucrative structures out there...

Currently the owner is exploring other options in the way of another office and other business opportunities. There are other circumstances involved but the end game is still the same.

[RonnieG]

If commission cuts are part of the package, as I would expect, In order to see the whole picture, she will need to see everyone's commission plan and production numbers for the past two years. Everyone may not be on the same commission plan. Established core top producers may or may not be on track to match their previous numbers, but are still probably the most reliable producers in the office. And some newer agents may be struggling or not producing anything, while others may be doing well.

Based on everyone's forecast production numbers, I personally would look for total salary/split/bonus package at least in the middle $100k to $200k to make the stress and responsibilities worthwhile, more if the local market will bear it, and look at my own potential commissions as gravy.

I would think that all general office expenses, including staff salaries, come out of the owner's pocket, while the managing broker's personal expenses, mileage, meals, entertainment, etc., are their own, just like any other agent.

Would any of the agents go with the current owner to the new office? Some might, since agent/broker relationships are often very personal. The owner may be counting on that to jump-start the new office. That could mean lots of time and effort spent on recruiting. Recruiting and in-office agent training are often a key responsibilities of a Managing Broker. Is she up to that herself, or will she need to recruit a trainer, perhaps another agent part time, and pay them?

Finally, some agents do not like competing with their managing broker, especially if walk-ins and call-ins go primarily to the Managing Broker. How did the Owner/Broker handle that? Would that be an issue for the other agents, especially the top producers?

Lots of political considerations as well as financial!