Long time reader, recent contributor here. While I was in Undergrad this Q&A was immensely helpful to me with working my way through the job hunt. This Q&A is more aimed at undergrads/grad looking to break into Commercial Real Estate. If there is any advice I can offer, please ask.
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Mind sharing a bit of your background?
Came out of a nationally ranked top 10 Real Estate Undergrad program in Florida with a second major in BM, graduated with a 2.9 GPA, no internship experience (Really regret that to this day). I received a couple of offers from National firms but went with a boutique instead for the faster career track/better splits.
AndyLouis may be interested in this if OP comes back...
Anyways, questions:
1) What are your hours like?
2) What different types of jobs are there in CRE starting out? Sales, Leasing, Capital Markets, etc...
2a) What are the pros and cons of each in your opinion?
3) What's your career trajectory look like?
Sorry, I initially made this post when I had a lot of down time. Since then my Analyst got sick and I had to finish packaging three different OM’s and bring an asset to market. Long story short, I’ve been fucked for the past two days. As to the questions: 1) This can vary greatly. I’m based in Florida, so it’s a little more relaxed. I usually work 7am-8pm. But on weeks like this I was in the office until 4am finishing the packages. 2) There are a number of places to start In CRE. You could begin as a leasing broker, which can be profitable but it’s very much a snowball path so it will take time. Another popular way is starting as an Appraiser. You can also work with a developer as a site selector/R&D associat. The more traditional start is working as an Analyst for a brokerage firm/developer/Bank/ect. This is a great place to start because you learn all the supporting roles of the business before moving into any kind of business development role. I skipped this route and went straight into a producer position. But that is not typical.
2a) Personally, I think the best place to start coming out of college is as an analyst for a big CRE firm. You get exposed to a lot of deal flow and get a really good understanding of how assets work. You are typically put in contact with a lot of influential/powerful people who control big time assets and you can leverage those relationships later if you decide you want to leave for another company. Analyst- Pros: Great deal flow, interaction with executives at other big firms, build knowledge base of CRE, Good base pay with a bonus. Cons: Long hours, analysts are burn out roles and companies know that. A typical analyst really only stays for 3 years. While you do get a good base pay and a bonus, it’s nothing compared to how much your associates are making, so there can be resentment there. Appraiser-Pros: Good hours, necessary resource for owners, consistent deal flow, you get a more unbiased view of assets because there is no internal pressure to beef up value. Cons: low pay starting out, no real bonus structure and the rest of the CRE world doesn’t really care about you. Appraisers can be a dime a dozen.
R&D Associate- Pros: Good pay starting out, you get an extremely strong understanding of markets and the assets that occupy them. Leads to a developer role or acquisitions role. Cons: I don’t really know this role enough to come up with any. Leasing Broker- Pros: Good hours, over time good pay. Can lead to investment sales. Cons: Depending on your broker, no draw/salary. The first year can be very dry and it takes time to build up a book of business. Can be tough for some people. Investment Sales Associate- Pros: Great pay and can lead to an acquisitions role with another company. Cons: Long hours, no draw/salary depending on broker, many believe you’re a dime a dozen, so sometimes business is a result of who was in front of the client last. Property Management – Pros: Good hours, develop strong understanding of how assets operate and where you can cut costs. Cons: Limited career movement/salary gains.
3) As of right now I plan to open a new branch office and manage it within the next 3 years. From there I could move over to a national firm as a Senior Associate to lead towards a Managing Director role. Frankly though, I plan on opening my own development company in 5 years and doing merchant redevelopment plays.
How in depth is the modeling you are doing?
I specifically specialize in Retail. So initially I do a full cash-flow valuation through Excel. After digging deeper into an asset I'll run an Argus model also.
Are you saying you do a quick BOE in excel? If so what is included in your BOE? Considering the lease structures in retail can be cumbersome why not drop it in Argus initially? Just curious.
Hey FirstPrize, if you get this ama going (ie answering questions) let me know and i'll add it to the frontpage
When it comes to working are you getting crushed the entire time you're there or is it more like IB where you may have a significant amount of downtime throughout the day?
Not really, there are definitely days where I get slammed, but that's usually when I'm putting together multiple packages. Other than that I make my own schedule throughout the day.
You work in investment sales from 7am to 8pm? Really?
This can vary, but usually I average those hours. A lot of IS brokers are lazy, especially in the south. I believe in hard work. Especially as a first year.
If you're constantly hustling to chase new business and build up your book yes for sure. Otherwise you're not going to make a dime. Everyone has this perception that real estate hours are super 'lax especially on the brokerage side of the business. Everyone I know who is a heavy hitter is putting in a solid work day.
This puts it best: http://www.wsj.com/articles/SB10001424052970204652904577191443118009260
Do companies hire investment sales associates straight out of top mba programs without CRE experience? If so, what is the career trajectory like (i.e. does it follow assoc/vp/director/md path of IBD, etc.)?
Post MBA, your sights should be set a bit higher than investment sales unless you really are dead set on a sales type role. Post top MBA, if you're in investment sales, you fucked up somehow.
I don't necessarily agree. I know quite a few brokers who could easily jump to the buyside if they wanted. I imagine they don't because they make great money and continue to build a large network. All work for your top groups in their respective markets (CBRE, Eastdil, C&W ECT.)
Thanks everyone, appreciate the feedback. More specifically, I see that Eastdil hires MBAs for both their IBD groups and investment sales groups. I will be coming from an S&T background, and realize I probably could have lateraled into investment sales earlier on but at this point I am set on attending a top 5-10 school and was wondering what career progression coming in as an Eastdil (or similar) investment sales associate would be. Are pay scale, exit opps, etc. similar to the post-MBA IBD career ladder?
Does that apply specifically to Eastdil's investment sales team as well? I was under the impression it was much more 'IBD-like' and institutionalized and that many of their Associates had MBAs.
I wouldn't say that "many of their [eastdil's] associates have MBAs"-- some do but certainly not all.
CRE Its probably easy to get into investment sales in general, you're right and we're speaking relatively. However, getting into the top 2/3 sales teams in a major market is NOT easy. They are lean, they are protective, and they work a sh*tload. They certainly don't want to be sharing their fees with just anyone. Firms out there are always trying to take their cake and they work around the clock to protect it.
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