Moving to real estate - Investment Sales Analyst vs. REIT Investment Analyst
I was lucky enough to have interviews at both a regional commercial real estate group for a Financial Analyst position on their investment sales team supporting the brokers and at an industrial REIT as an Investment Analyst working on acquisitions, development and dispositions. Both of them went well and I was able to secure an offer from the investment sales FA position. I am waiting to hear back from the REIT. Both of these positions are in a major midwestern city.
Assuming I was to get both offers, I want to make sure I fully understand both roles. The roles are similar in that I’ll be conducting cash flow analysis, market research, researching comparables, etc. They are also different, obviously, in that one is investment sales and one is a REIT. Compensation wise, Investment sales is $40k + bonus, 50% being a reasonable number for first year. REIT would start in the $50s plus stock compensation and bonus, exact percent uncertain.
I understand how these roles are different, but I wanted to see if anyone could offer additional perspective on the opportunities provided by both and what your experiences have been.
Thanks!
What are your long term career goals?
The longer you stay in the investment sales group the more they will groom you to be a broker one day. What are your thoughts on that?
Office culture is important too, you will be spending 50 – 70 hours a week with these people.
Both options are great, you will be happy with either.
Yeah, the office culture thing is definitely something that is pretty heavily weighing into my decision-making process. The investment sales team is pretty much all younger people, and the ones I met seemed like they'd be a great team to work with. The REIT team I'd be on all seemed to be men over 30 with families, so while I'm sure I would get along with them, I imagine there would be a culture gap between me and them.
Like poster above said, depends on long-term career goals. Most people I know in RE would rather be on the ownership/development/acquisition side of the business. For me, it wouldn't be a question; I'd take the analyst position with the REIT working on development, acquisitions, and dispositions. If you want to be a salesman, investment sales would be the obvious choice.
REIT
REIT
Congrats man. As someone who would love to be in your shoes in the near future, would you mind sharing a little of your background?
I graduated last May from a small, non-target liberal arts school with a degree in Economics. I had previously interned at a fortune 50 company for two summers, but in a non-finance capacity, so I was initially worried about getting a job in finance. Luckily, a guy I knew recommended me for a position as a financial analyst at an economic development agency. My role is on a pretty unique team, we've been making investments in early stage companies in our state alongside Angels and VCs to try to establish our state as a regional technology hub.
I ended up getting both of these interviews just through finding the positions online and submitting my resume. I'm currently working in the same state my school was in, but would like to move back to Chicago as the opportunities there are much better than my current location and my family/friends are in the region.
The best advice I can give you is, unsurprisingly, network. I only have managed to get here because I ended up knowing the right person initially. I know it's beating a dead horse, but it really is the best thing you can do to get where you want to be.
Cool, thanks for the response. I'll be interning at a small full service cre company over the summer and I networked my way into it, so I guess i'll keep at it.
I think you should consider whether or not you're interested in staying in the industrial arena for an extended period of time.
You'll get exposed to more asset level details at the REIT, and will likely gain some operational knowledge whether you want to or not. You should be able to leverage some of this knowledge into industrial focused funds, or brokerage firms down the road. Conversely, you might have some catching up to do if you try to transition from sales into the principal/ownership side.
If you're not sold on working with industrial assets long-term, investment sales may offer more exposure to other asset classes, a larger network of brokers and principals, or a knowledge base and skill set that is more transferable. While you will certainly get a solid underwriting foundation, if you go with a REIT for two years and never touch industrial assets again, you'll end up with a lot of useless operational information in your head.
I work for a REIT in a niche asset class and wouldn't trade my experience, but I know it will take some catching up if I choose to transitions to a different property type.
Agree with above. Is the investment sales team you are joining focused on one specific asset class? Working as an analyst at an industrial reit will pigeonhole you as an industrial guy.
I think the most important thing early in anyone's RE career is to expose yourself to as much deal flow as possible (over as many asset types as possible). It also lets you figure out what you really enjoy working on.
Investment sales position is focused primarily on retail shopping centers, so unfortunately I don't think either would offer a very wide breadth of asset classes.
Congrats on earning the opportunity to choose for yourself. Agree with pretty much everything said above. Now that it looks like you'll be specializing in a single property type regardless of which way you go (more or less), I think it makes a lot of sense to consider your long-term goals again. From my experience, I think you gain a lot from learning how to structure deals with third-party equity investors and lenders. While analysts working for brokers certainly dive into modeling a waterfall and making assumptions as to the probable financing terms during certain deals, I think the analysts working for the operators and equity partners have to drill down and learn more about those aspects, which can be extremely helpful down the road. However, if the REIT provides 100% of the equity and issues unsecured corporate debt to finance all of its deals, this consideration doesn't really apply. Hope this was helpful.
This is definitely a downfall for working at a REIT. As an acq / development analyst I'm rarely involved with financing our deals because its all taken care of at the corporate level post-transaction. The one exception is for JV opportunities that need financing in line with the market to achieve acceptable returns for our partner. However, as we are typically the development specialist, operational specialist, and capital provider, we rarely have a need for a partner; exceptions are generally made when its the only option to get our hands on an irreplaceable site.
Do you consider yourself a type "A" people person that is extremely motivated and willing to cold call and email investors about deals all day? If not, don't consider it.
If the 30 year olds with kids have a proven track record of successfully deploying capital, you will probably learn much more from them. I highly doubt any brokerage analysts model waterfalls, considering that any client thats sophisticated enough to utilize these types of deal structures, knows enough to not trust a brokers proforma
REIT. You'll learn many more aspects of real estate and have more exit options in the future if you choose to leave.
btw, as far as product type, don't worry about that. especially in this case, where you're looking at retail vs industrial. if you can understand industrial, then you can understand retail and office, and vice versa.
Appreciate everyone's insight. Still haven't made up my mind yet but this has definitely provided a lot of good perspective.
REIT imho
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