Which asset class do you enjoy/hate most?
Currently in multi family acquisitions and hate it. I would probably like it more if ground up dev. Looking to transition into more office.
Which do you guys enjoy/hate?
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Career Resources
Love: Hospitality
I would love to work on Hotels however it seems it’s near impossible unless you went to Cornell and graduated in their program.
Care to go into more detail about why you enjoy the sector? Genuinely curious as I've not worked on a hotel deal before.
I work at a large GC and we build hotels. They're interesting to me because of the amount of care that will go into the finishes and design of it. Industrial is pretty boring imo, although it is booming. Hospitality you deal with a lot of interesting people.
Also, I have never really traveled much so I think hotels are something I am not really used to.
I've done plenty of hotels but my background is IB restructuring (top MM shop) -> REPE.
I've looked at a few hotel cornell courses and they are atrocious at best. If you have a corp background hotels should be easy to pick up. I will accept that MF/condos -> hotels is a bit tougher given the operating nature of the hotel, but they're not really that complicated and simply studying past hotel deals should be sufficient for any smart guy to pick it up with relative ease, as it's still RE at the end of the day. Cornell hotel program is really not impressive and probably better for managerial positions (GM of a property) than investing given the lack of intellect.
Can you dm the Cornell course material. Thanks man.
Curious to see what they learn at that program.
butthurt cornell alums with the MS
I also love hotels and condos but don't get to work on them in my current role unfortunately. Did a lot of that at my previous shop. Personally, I dont like office deals - mostly because I hate scrubbing Argus models and reimbursements.
I second the property type preference.
I work primarily in multifamily and student housing projects that contain 8,000-80,000 SF of retail (much more often on the lower side of that range). I've worked in office before.
My enjoy/hate determinant isn't asset classes (although student housing would definitely be last) but level of assets. When I'm working on a project that defines the submarket it's in, or sets the standard in terms of design, features, etc. I absolutely love it. When I'm working on a garden deal in the middle of nowhere, I can't possibly bring myself to care as much, even if the yield is better.
Trophy asset home runs get me going way more than suburban singles and transitional neighborhood doubles ever could. I love the long ball.
Size > Asset Class. Give me a massive MF project w/ ',000s of suites over the world's most profitable 20-unit low-rise. The kicker is that the small guys often cause bigger headaches.
Not to mention, the time required for large projects isn't anywhere near a linear increase from small projects
SB for the passion. Know I'm in the right business because of all the "market maker" deals and how far I dive into them. Nothing better than getting to work on an incredible asset.
Interned at a hotel REIT and really liked it, although I am currently doing MF bridge and construction lending.
How does one get into Hotels without a Cornell degree? Seems like a real niche but interested asset class but incredibly difficult to get into unless you graduated from there.
Is Cornell’s online cert a waste?
How to get in: know a lot about the niche, know the terms, I've seen guys who worked in hospitality go into Hotel Development & Acquisitions. Also seen former IB go into it. Look up hotel brands and those roles. Get in with a big GC that does hotels. Get in at JLL/ CBRE Hospitality platforms.
No idea if it is a waste. UCLA Cert is not.
Big fan of non-core retail. The satisfaction that comes from buying a piece of garbage at an 8-9 cap, redeveloping it, and reaping a well-above average IRR is unbeatable.
Looking to get more involved in industrial
Big fan of industrial lubricants, if you know what I mean.
Love buying crappy multifamily and executing strategies that no one else in the market is thinking of. Especially in the affordable space, turning buildings around by treating tenants as people instead of rent checks is immensely rewarding.
Have been in seniors housing/skilled nursing for a few years and have loved it. Much more of a niche space but have enjoyed how it's more operationally intensive than some of the core asset classes. The underwriting methodologies & technical skills are fairly similar to traditional multifamily too (at least the basics are), so while a niche space it can still provide a solid foundation if one ever wants to make the switch to traditional multifamily. Outlook for the sector, seniors housing in particular, is quite strong as well.
What sort of role are you in that space? The "silver tsunami" is going to be great for senior coming up, but I think there are going to be a couple winners and losers in skilled nursing as PDPM gets rolled out.
Can you expand on this? Who will be the losers?
I'm immersed in the seniors space right now and find it incredibly challenging. There is too much capital flooding into the space and labor/wage inflation is eating profit on both the construction and operations side of the business.
I think there will be pain for 2-3 years until demographics catch up with supply.
I'm involved in this space along with skilled nursing too, and we get more than our fair share of deals we should pass on but sometimes the numbers justify the yield. However, we're seeing a lot of "smart money" look at deals that don't really have any merits.
Have worked on acquisitions and/or development of retail, office, multifamily, condos, hotel, industrial.
Most interesting/fun developments - urban boutique hotel, urban multifamily/condo, urban office on spec, industrial on spec can be fun. Basically getting to be analytical and creative at the same time makes the job fun.
Most boring developments - retail, BTS industrial, garden apartments.
Also been looking at deals on the side. When it's my own money/profit to be had, all of the above goes out the window and whatever brings in the biggest payday most interests me.
I hate McMansions and most newer build SFH/Apartments in general. At least here in Dallas they lack the character or uniqueness that older builds have.
Kinda why I have an interest in historical redevelopments and urban redeveloping
Wrap apartments in Dallas and Houston are terribly disgusting. Some of the paint color schemes are so awful, and the interior design choices hideous.
Less so on interior design, which I have seen done very well, but the architecture on wrap products is so piss poor 99.99% of the time that it is embarrassing and the public is catching on.
I really enjoy creative retail redevelopment and boutique apartment redevelopment. I tend to daydream about out-of-the-box landscaping and facade work that could totally transform boring uninspired garden-style multifamily properties. Retail is very interesting when trying to create a sense of place by focusing on shared patio areas, art work, landscaping, creative signage, etc...
Dislike cookie-cutter wrap apartment development (uninspired, cheap) and industrial/self-storage development (boring). Dislike office from a financial perspective due to CapEx demands.
Industrial is boring from the outside, but the insides are undeniably cool. Maybe I am easy to impress, but when I see really complicated conveyor systems, automated robotic arms, or robotic Bezos slaves, I get excited.
Landscaping is way underrated. It really makes a HUGE difference with the curb appeal of any development
Strongly dislike office. Enjoy pretty much everything else.
Why?
It's super time and capital intensive, for really (in my opinion) boring outcomes, and recently not enough of a spread in return to be worth the effort.. There are a few really cool creative office buildings in any given market, but outside of those, it's a lot of effort for pretty standardized returns/tenant base. Especially in high-rise product, how many small law office leases can you do before it gets monotonous? I am also not bullish on the product in general. As the workforce continues to be automated it would theoretically be the most impacted, so I don't like it from a continued viability perspective either.
Strong like for any asset class where there is a transformation. There is nothing like turning the ugliest property around into one of the most desirable.
On the hate side, affordable housing. Not because of the tenants or neighborhoods but simply because of the government agencies that you have to work with. Even the simplest of affordable housing deals take months longer than they should due to red tape and bureaucratic incompetence.
Fair, but also... that is why you make money on affordable housing. If they transacted at the same pace and with the same ease as market rate multifamily, then you'd see everyone in the world doing it. An asset with almost no downside risk that you can execute a dozen transactions on a year? Dealing with the regulatory structures and bureaucracy is the barrier to entry on affordable. Not liking that is a perfectly valid opinion, but... it's a feature, not a bug
You have any materials on profitably building affordable? My shop (capital partner) only does Class A and would be interested in pitching it later in my career.
Hate suburban office. It is so ridiculously boring. Essentially commodity space with no real differentiating factors.
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