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Let's talk Argus
 

theBEEGEES's picture
 
Points)
 on 6/8/12 at 3:00am
argus.jpg

Now that there's a dedicated RE forum I feel like we should have an Argus thread. Argus website here: Argus Software

I've talked to a few people in the industry over the past week and they have stressed how important an Argus certification will be to break in straight from undergrad. Being a student I can do it all for around $1,500 it seems. Do people see this as a sound investment if I'm dead set on breaking into RE acquisitions either in PE or AM? One person I spoke with mentioned some firms will reimburse employees for the certification, is this true for the most part?

Also feel free to discuss any other Argus related topics in here.

Tags:
any143's picture

Can't speak for what it looks

IB
(Monkey, 64
 
Points)
 on 6/7/12 at 12:52pm

Can't speak for what it looks like to a senior level guy, but to me it seems like a waste of time. Argus takes no more than a week to learn completely. Getting a certificate to prove that is a waste of money. Sure it can do some pretty advanced stuff, but if your only goal is to get cash flows on the property or portfolio level, there really isn't too much to it.

Just my two cents as a lowly analyst in real estate

kjl's picture

At my school, we banded

RE
 
Points)
 on 6/7/12 at 1:02pm

At my school, we banded together with another local school to get the guys from Kahr Real Estate to give a quick two day training session (over a weekend) on campus for a severely discounted rate (I think the school also chipped in a bit). Not sure if you're feeling proactive and can get such support, but there are ways of getting training without having to pay $1,500.

kmzz's picture

i dont think u can know

O
 
Points)
 on 6/7/12 at 1:08pm

i dont think u can know everything about argus even if u used it for a year

RE_Dirka's picture

Calling Argus support/

 
Points)
 on 6/7/12 at 2:09pm

Calling Argus support/ googling/ trial and error goes pretty far without any basic training. Not sure you need to take the class although my company paid for it and I picked up some new shortcuts, nothing vital though. You really only need Argus for the cash flow export like any143 said. Most of the modeling done will be in excel.

theBEEGEES's picture

It's interesting you said

 
Points)
 on 6/7/12 at 2:14pm

It's interesting you said that, Dirka. I talked to an analyst at a RE AM fund yesterday and he said they do all their modeling in Argus. Is there a consistent breakdown of Argus use vs. Excel use in the industry or does it vary more firm-to-firm?

brandon st randy's picture

theBEEGEES: It's interesting

PE
(Gorilla, 693
 
Points)
 on 6/7/12 at 2:24pm
theBEEGEES:

It's interesting you said that, Dirka. I talked to an analyst at a RE AM fund yesterday and he said they do all their modeling in Argus. Is there a consistent breakdown of Argus use vs. Excel use in the industry or does it vary more firm-to-firm?

Maybe I am missing something here but my impression has always been that Argus is very easy to learn and use. Basically you are just plugging in numbers into existing formulas most of the time. The downside is that this software is extremely rigid, if what you are modeling is exactly the way their algorithm is set up, then great. If you have to set up a slightly different/creative capital stack then you are much better off doing it on your own with Excel.

Argus is great for tedious and standard analysis such as rent roll, but I would not use it to analyze the increasingly more creative capital structures than are sthe norm nowadays.

I can tell you how I made each of my millions - but not where I got the very first

RE_Dirka's picture

Don't get me wrong Argus is

 
Points)
 on 6/7/12 at 2:32pm

Don't get me wrong Argus is used very heavily to construct property-level assumptions (e.g. existing vacant lease up, market lease assumptions). However, Argus is quite limited in terms of impementing leverage assumptions and other specific inputs to project IRR

kjl's picture

What Dirka said is true. My

RE
 
Points)
 on 6/7/12 at 2:46pm

What Dirka said is true. My firm as well as many others I know use Argus to crunch the lease data and then export to Excel to model leverage, waterfalls, etc.

I think you can get a trial version of Argus for free. While it won't let you open/import existing Argus files, you can still play around with it to get a feel. Argus itself is pretty easy to pickup. The only thing that may require some experience is debugging since Argus is essentially a black box.

ms87's picture

Unless you're in a position

 
Points)
 on 6/7/12 at 3:13pm

Unless you're in a position where $1,500 is no big deal, i.e. not where most undergrads looking for a job are, spending your own money to take an Argus training course would be a waste.

The Argus certification *might* make your resume stand out in a crowd to get you past an HR drone, but after 2 days in a classroom you won't really know how to use Argus on the job. Also, as mentioned, once you're past the initial hurdle of knowing where to input assumptions/data, the software is pretty straightforward.

A company that expects you to use the software as a young analyst with no prior experience will pay for your training, but I sincerely doubt it would reimburse the cost if you paid for it before you were hired. Also, be aware that Argus isn't even relevant for major parts of the industry. If you work for a multifamily investment shop, for example, your company probably won't own a copy of Argus.

Two caveats: I know some RE programs get their students access/training. If it's free, you'd be a fool not to take it. The other caveat is that I'm not an HR drone (just a real estate finance drone), so I don't know what will help you get a job, which is obviously your primary goal. I can say that having taken the Argus training course within the past year, it isn't worth $1,500 of your own money, especially when you don't know if/how you'll be using it.

theBEEGEES's picture

Thanks for all the awesome

 
Points)
 on 6/7/12 at 3:21pm

Thanks for all the awesome responses guys. I can pick up the student version of Argus for $100 so I think I'll do that and see how far I can get and then reevaluate.

While we're on the topic of modeling has anyone had experience with the BIWS RE modeling package?

sk8247365's picture

kjl: What Dirka said is true.

PE
(Gorilla, 524
 
Points)
 on 6/7/12 at 3:33pm
kjl:

What Dirka said is true. My firm as well as many others I know use Argus to crunch the lease data and then export to Excel to model leverage, waterfalls, etc.

I think you can get a trial version of Argus for free. While it won't let you open/import existing Argus files, you can still play around with it to get a feel. Argus itself is pretty easy to pickup. The only thing that may require some experience is debugging since Argus is essentially a black box.

Argus is easy. It is like an excel model that has strict inputs and will not #ref! out. it is a black box, and most acquisition shops are going to have something else so they can model the very specific attributes/sensitivities of an asset.

Regardless, if you are serious about RE and have no/little experience, I would say the certification is a great way to show an interest. As with most potential undergrad-ish jobs in RE, you are competing with those with 2-3 years experience. They will know the program, or at least the concepts to quickly use it.

I have never taken or looked into the course myself. But if I was hiring an undergrad who had taken it, I would be much more interested in them as a candidate.

So, to answer your question, I think it is important to break in - but really only to break in.

sk8247365's picture

Double Post

PE
(Gorilla, 524
 
Points)
 on 6/7/12 at 3:35pm

Double Post

Relinquis's picture

Most large brokerages firms

RE
(Neanderthal, 2,186
 
Points)
 on 6/7/12 at 5:27pm

Most large brokerages firms use Argus so they will send pro-formas in Argus files. It's widely used so people recruiting real estate finance juniors like to know that you have used it before.

A lot of Mid-Senior guys in real estate don't know how easy Argus is (they became mid-senior before it was used everywhere). That's why people ask about it. Also, most RE teams are small and unlike the large investment banks, there is rarely any structured training so they expect people to know what to do / to have learned modelling in general beforehand.

Argus is easy to learn and to use. I prefer to export the property level cash flows to excel and then model from there, but I can see how people might want to do the debt modelling, etc... in Argus if they're dealing with very simple structures.

The only thing about Argus that you should keep in mind is to talk to their software guys and learn how it does it's calculations, i.e. what the black box is doing behind the scenes.

The BIWS Real Estate course looks like it can actually teach you something about modelling as opposed to just how to input stuff into Argus. A lot of the REIT stuff in that course won't be relevant to you if you are buying buildings, but the rest is very valid.

Definitely use the student trial of Argus (at least) so you can see how silly a program it is to use. It's just a database that takes your lease / rent roll assumptions and spits out the related cash flows. People will ask you if you know modelling. They may also ask you if you've used Argus (I've been asked).

Personally I don't care if a candidate knows Argus or not. I'm much more concerned about whether or not they understand finance concepts / theory and have learned how to analyse investments / projects in excel. A shitty investment or bad assumptions / modelling is as bad in Argus as it is in Excel or on paper. Argus is standardised so you won't get errors from making mistakes in a formula (there aren't any), but it is still subject to Garbage In Garbage Out. Not everyone feels the way I do.

tl;dr version:
1 - Learn Excel modelling (you might be tested).
2 - Familiarise yourself with Argus. Do the cert if you want, but make sure you've covered no.1.

relinquis... Killing the GMAT this December; Over/Under set at: 725 GMATs.

sk8247365's picture

Personally I don't care if a

PE
(Gorilla, 524
 
Points)
 on 6/7/12 at 6:19pm

Personally I don't care if a candidate knows Argus or not. I'm much more concerned about whether or not they understand finance concepts / theory and have learned how to analyse investments / projects in excel. A shitty investment or bad assumptions / modelling is as bad in Argus as it is in Excel or on paper. Argus is standardised so you won't get errors from making mistakes in a formula (there aren't any), but it is still subject to Garbage In Garbage Out. Not everyone feels the way I do.

---------------------------------------------------------------

100% agree. When it come to who is actually hired, I could care less if they know Argus.

However looking at a recent grads resume I I might actually call them and better understand their interest in RE and experience in excel (given that they probably say they are an expert). Then I would test them in excel (like relinquis said). I really do think it is a good resume credential, but emphasize the undergrad / no actual RE experience.

The main reason is if you are familiar with Argus, I like do not have to explain cam, etc, and you generally know how RE is valued on a high level basis.

Think of it this way:
Resume #1 - #50: Solid GPA, a couple internships, No RE, CV says likes RE
Resume #51: Solid GPA, a couple internships, No RE, CV says likes RE, ARGUS Certified

Resume #51 would at least get a call in my book.

Still, this is probably the best take away on this thread:

1 - Learn Excel modelling (you might be tested).
2 - Familiarise yourself with Argus. Do the cert if you want, but make sure you've covered no.1.

RE_Dirka's picture

Bit curious as to the level

 
Points)
 on 6/7/12 at 6:39pm

Bit curious as to the level of modeling at other shops. My firm has its own proprietary valuation model that does VBA exports from Argus so unless I'm looking at a huge portfolio, I'm rarely building a model from "scratch". Thus, most of my modeling is post property-level cash flow on the debt/promote etc...

Do you guys have to build your own excel models from scratch frequently or have a valuation template as well? Unless you are looking at a REIT or entity-level takeover, I'm wondering how neccessary it is to create an excel model for one-off asset level transactions and if I need to step my game up if I were ever "tested".

sk8247365's picture

Thus, most of my modeling is

PE
(Gorilla, 524
 
Points)
 on 6/7/12 at 7:01pm
Relinquis's picture

We use excel for every new

RE
(Neanderthal, 2,186
 
Points)
 on 6/7/12 at 7:10pm

relinquis... Killing the GMAT this December; Over/Under set at: 725 GMATs.

kmzz's picture

brandon st randy: Maybe I am

O
 
Points)
 on 6/7/12 at 7:11pm
RE_Banker's picture

I would say that I've used

PE
(Gorilla, 513
 
Points)
 on 6/8/12 at 6:17am
theBEEGEES's picture

It seems like everyone is in

 
Points)
 on 6/8/12 at 7:38am
tprb52's picture

RE_Dirka: Do you guys have

RE
(Monkey, 64
 
Points)
 on 6/8/12 at 9:33am
tprb52's picture

RE_Banker: There is no way

RE
(Monkey, 64
 
Points)
 on 6/8/12 at 9:35am
re-ib-ny's picture

This thread has received

PE
(Gorilla, 688
 
Points)
 on 6/8/12 at 9:39am
ms87's picture

tprb52: RE_Banker: There is

 
Points)
 on 6/8/12 at 12:05pm
RE_Banker's picture

ms87: tprb52: RE_Banker:

PE
(Gorilla, 513
 
Points)
 on 6/8/12 at 1:17pm
requestions's picture

I didn't read the responses

(Monkey, 36
 
Points)
 on 6/10/12 at 12:58pm
tprb52's picture

ms87: He may have a

RE
(Monkey, 64
 
Points)
 on 6/13/12 at 10:16am
Penn7690's picture

Where did you get the $1,500

 
Points)
 on 6/13/12 at 7:54pm
theBEEGEES's picture

The $1,500 includes the $99

 
Points)
 on 6/14/12 at 9:05am
av8ter's picture

I took the two day class.

O
 
Points)
 on 6/16/12 at 12:49am
Penn7690's picture

av8ter: I took the two day

 
Points)
 on 6/16/12 at 12:52am
av8ter's picture

Penn7690: av8ter: I took

O
 
Points)
 on 6/16/12 at 1:25pm
tbux22's picture

If you are a student the cost

(Monkey, 47
 
Points)
 on 7/11/12 at 7:46pm
WSOusername's picture

^damn dude, I thought that

 
Points)
 on 7/11/12 at 9:14pm

GBS

tbux22's picture

Sachs, I think it is worth

(Monkey, 47
 
Points)
 on 7/11/12 at 10:26pm
econcomputingCRE's picture

I'm surprised people will pay

(Baboon, 139
 
Points)
 on 10/16/12 at 3:54pm
huanleshalemei's picture

I've gone through some of the

(Gorilla, 511
 
Points)
 on 10/16/12 at 5:24pm

The Auto Show

argusvaluation's picture

Hi everyone, from reading the

(Chimp, 2
 
Points)
 on 11/28/12 at 1:49am

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