ANALYSIS: European executives trade carry for pay

Bohill Partners’ annual European compensation report highlighted executives’ willingness to trade promote incentives for a higher base salary late in the cycle.

Late in the real estate cycle, European investment professionals are starting to make trade-offs, preferring more base compensation to potential carry, according to the latest research by executive search firm Bohill Partners.

The finding was one of a few by the London-based firm, which published its eighth annual compensation review this week, surveyed over 70 London-based firms with a UK or pan-European real estate presence. Dividing the real estate world into private equity, fund management and property companies, the firm found average compensation remained largely static last year compared with 2016.

Bohill broadly categorizes “private equity” as private equity firms that have built a real estate arm, such as Blackstone or Carlyle, with closed-end funds typically in the value-added or opportunistic space and senior investment professionals who take part in carried interest. By contrast, “fund management” describes institutional core managers, such as AXA, that typically do not provide carry but do have other incentive structures.

Here, PERE analyzes the compensation data for various roles within those businesses.