Private Equity RE - Long time lurker, first time poster - 30bn AuM
Hello fellow monkeys-
I've been lurking around the forums for quite some time now. I must admit, I was a little disappointed to see there is no Real Estate specific forum- and I really think that should change. I'd be happy to help moderate or contribute in any way. I recently entered the institutional space, coming from a real estate asset level / private background and an "outside the box" type of pedigree compared to what you would typically find at your average shop on the Street.
I work for an investment manager that has over 30 billion under management in PE, RE, debt and infrastructure. I am on the real estate sourcing/deal making side and I focus on direct equity, secondary and pref. equity / mezzanine transactions, typically in the 10 - 30m range per check but with the ability to go far higher.
I am located in the NYC area and focus on US deals however, as a secondary market I am spending some time in Europe with a lot of interesting deal flow coming to the market recently.
I commend this website, I think it's the best around for really getting an inside track as to what is going on out there...with the exception of the countless trolls I see, but I guess that just can't be avoided... happy to be a part of the community!
Best,
B
What kind(s) of strategy does
What kind(s) of strategy does your firm employ? Is it more heavily opportunistic? Value-added?
What kind of background do you have?
Thanks! Interested to see how this thread turns out.
Sent a PM, but might as well
Sent a PM, but might as well post here too for everyone to see...
What are your hours like? How long have you been in the industry? Any general thoughts on how interesting the asset class is?
Rana Clamitans wrote: What
What kind(s) of strategy does your firm employ? Is it more heavily opportunistic? Value-added?
What kind of background do you have?
Thanks! Interested to see how this thread turns out.
Hi Rana,
We are very creative up and down the capital stack. For direct equity, typical JV 90/10 structures or preferred equity / mezzanine we look to partner with highly skilled operators who have dealt with other institutions or allocators in the past. Our strategy is typically "value-added" or "opportunistic" and right now frankly we are more attracted to tier-2 cities as oppose to the gateway markets which we feel are getting inflated due to overbidding on core assets and an artificially low interest rate environment. We also have a secondary fund set up to buy out existing LP interests in funds and assets as well...this is a huge marketplace with only a handful of institutional players on the RE side, as oppose to PE where the market is much more matured.
My background is asset level acquisitions and sourcing, on the buy side and investment sales and leasing brokerage, as well as capital raising but historically I've done smaller deals, raising capital on a deal-by-deal basis, on behalf of high net worth smaller fish... I am new to the institutional fund side. I am the sourcing / business development "hustler" type who cracked into the PE. The fund vehicles and secondary modeling / analysis is where I am my infancy stage and excited to learn more and do deals.
Best,
B
global private equity real estate
Rana Clamitans wrote: What
What kind(s) of strategy does your firm employ? Is it more heavily opportunistic? Value-added?
What kind of background do you have?
Thanks! Interested to see how this thread turns out.
Interested as well.
yourdreamtheater wrote: Sent
Sent a PM, but might as well post here too for everyone to see...
What are your hours like? How long have you been in the industry? Any general thoughts on how interesting the asset class is?
Hours are 8am - 8pm sometimes more sometimes less, it really depends on your work load, how efficient you are, what team you are on...it all depends, I could get a phone call from a seller notifying me that a competitor came in and is submitting a bid tomorrow and all of a sudden priorities change and it's going to be a late night. When it comes down to it, you are either valuable and producing and a team player or you are not... I am very happy with respect to the entrepreneurial freedom I have in my role (sourcing/biz development) as well as the deal experience I am getting.
I have been in PE real estate for only 3 months...I finally broke through. commercial real estate, in general, I've been employed on both the principal acquisition and brokerage side since I was 21, consistently from age 21 until 27 ... so 6+ years. I took the "experience route" and graduated college with a deal sheet attached to my resume
global private equity real estate
nycapitalmarkets
Sent a PM, but might as well post here too for everyone to see...
What are your hours like? How long have you been in the industry? Any general thoughts on how interesting the asset class is?
Hours are 8am - 8pm sometimes more sometimes less, it really depends on your work load, how efficient you are, what team you are on...it all depends, I could get a phone call from a seller notifying me that a competitor came in and is submitting a bid tomorrow and all of a sudden priorities change and it's going to be a late night. When it comes down to it, you are either valuable and producing and a team player or you are not... I am very happy with respect to the entrepreneurial freedom I have in my role (sourcing/biz development) as well as the deal experience I am getting.
I have been in PE real estate for only 3 months...I finally broke through. commercial real estate, in general, I've been employed on both the principal acquisition and brokerage side since I was 21, consistently from age 21 until 27 ... so 6+ years. I took the "experience route" and graduated college with a deal sheet attached to my resume
In somewhat a similar route and would love to get your advice. Currently in my early 20s, some CRE experience and now with an institutional / REIB group; but looking sometime in the future to move toward a buy-side REPE role. Curious how you came upon the role. I've noticed that having experience working with the client / firm is sometimes a great way to open doors. Also, considering heading back to school, perhaps a Masters in RE?
I'm verry happy that someone
I'm verry happy that someone decided to make a Q/A on RE. Thank you very much, already one SB for you.
Why did you take the REPE route instead of "classic" PE ?
Do you think it is possible to break into REPE with just a Master in RE ?
How the pay compare to 'classic" PE ?
My advice is to never give
My advice is to never give up, be relentless and aggressive but professional and sincere. Tailor each resume/cover letter for the particular firm and role specifically. Do your homework on the company culture, vision, leaders, etc. I think a Masters is a great idea but not if it's going to eliminate your real life work experience...Even if you are a commission only brokerage/consultant role with a top shop (ie: JLL, CBRE, Cushman, etc.) - stay employed and DO DEALS. There is no degree that can ever replace transaction experience and procuring business relationships. Networking (in person events, meetings, linkedin, etc.) is also very important. I've kept in touch with all of the industry professionals I have met since I started in the business, which has helped tremendously.
I found the role online, posted on the "open positions" section of their website. Other great resources include selectleaders.com, doostang.com and I was using indeed.com to broadly search all sites. It might be a good idea to narrow down the type of firm you think your skill set fits best with, then figure out who are the players that are growing (not shrinking or hiring freeze) then see if there are open positions and see who does the hiring, who runs the place, do you know anyone there, referrals are great but these positions can be won without a referral too... Never give up.
global private equity real estate
I think the pay is fairly
I think the pay is fairly similar if not the same to classic PE and it really depends on the shop regarding comp structure. I've been reading a lot about salary increases and bonus decreases... other firms may be doing the opposite. Obviously if you can negotiate carry that would be ideal but I don't think there are many entry level analyst/associates that are doing that these days... I am not an expert in this dept. though as I am new myself...
global private equity real estate
nycapitalmarkets wrote: Rana
What kind(s) of strategy does your firm employ? Is it more heavily opportunistic? Value-added?
What kind of background do you have?
Thanks! Interested to see how this thread turns out.
Hi Rana,
We are very creative up and down the capital stack. For direct equity, typical JV 90/10 structures or preferred equity / mezzanine we look to partner with highly skilled operators who have dealt with other institutions or allocators in the past. Our strategy is typically "value-added" or "opportunistic" and right now frankly we are more attracted to tier-2 cities as oppose to the gateway markets which we feel are getting inflated due to overbidding on core assets and an artificially low interest rate environment. We also have a secondary fund set up to buy out existing LP interests in funds and assets as well...this is a huge marketplace with only a handful of institutional players on the RE side, as oppose to PE where the market is much more matured.
My background is asset level acquisitions and sourcing, on the buy side and investment sales and leasing brokerage, as well as capital raising but historically I've done smaller deals, raising capital on a deal-by-deal basis, on behalf of high net worth smaller fish... I am new to the institutional fund side. I am the sourcing / business development "hustler" type who cracked into the PE. The fund vehicles and secondary modeling / analysis is where I am my infancy stage and excited to learn more and do deals.
Best,
B
My advice is to never give up, be relentless and aggressive but professional and sincere. Tailor each resume/cover letter for the particular firm and role specifically. Do your homework on the company culture, vision, leaders, etc. I think a Masters is a great idea but not if it's going to eliminate your real life work experience...Even if you are a commission only brokerage/consultant role with a top shop (ie: JLL, CBRE, Cushman, etc.) - stay employed and DO DEALS. There is no degree that can ever replace transaction experience and procuring business relationships. Networking (in person events, meetings, linkedin, etc.) is also very important. I've kept in touch with all of the industry professionals I have met since I started in the business, which has helped tremendously.
I found the role online, posted on the "open positions" section of their website. Other great resources include selectleaders.com, doostang.com and I was using indeed.com to broadly search all sites. It might be a good idea to narrow down the type of firm you think your skill set fits best with, then figure out who are the players that are growing (not shrinking or hiring freeze) then see if there are open positions and see who does the hiring, who runs the place, do you know anyone there, referrals are great but these positions can be won without a referral too... Never give up.
Thanks for the advice nycap. I've done just that and have been making a list of all the shops I've read about or come across. Though it's sometimes a bit difficult as these small to mid-tier firms (sometimes even larger REITs) often don't have careers or HR departments. Did you ever consider or use a recruiting agency? It seems like many of these buy-side RE shops rather just find their talent through a headhunter or use job boards like Selectleaders.
I'm curious on the fact that your shop is moving away from the gateway trophy markets and into more secondary markets. Given that, are you guys just mostly focusing on the major four food groups then? It seems a lot of the deals I've seen recently are just that; best available class A assets in 2nd or 3rd tier markets. Also, if you don't mind me asking, given the market, what kind of mezz returns do you guys typically seek? 5-7 year investment horizon? IRR?
Thanks!
STCM wrote: nycapitalmarkets
What kind(s) of strategy does your firm employ? Is it more heavily opportunistic? Value-added?
What kind of background do you have?
Thanks! Interested to see how this thread turns out.
Hi Rana,
We are very creative up and down the capital stack. For direct equity, typical JV 90/10 structures or preferred equity / mezzanine we look to partner with highly skilled operators who have dealt with other institutions or allocators in the past. Our strategy is typically "value-added" or "opportunistic" and right now frankly we are more attracted to tier-2 cities as oppose to the gateway markets which we feel are getting inflated due to overbidding on core assets and an artificially low interest rate environment. We also have a secondary fund set up to buy out existing LP interests in funds and assets as well...this is a huge marketplace with only a handful of institutional players on the RE side, as oppose to PE where the market is much more matured.
My background is asset level acquisitions and sourcing, on the buy side and investment sales and leasing brokerage, as well as capital raising but historically I've done smaller deals, raising capital on a deal-by-deal basis, on behalf of high net worth smaller fish... I am new to the institutional fund side. I am the sourcing / business development "hustler" type who cracked into the PE. The fund vehicles and secondary modeling / analysis is where I am my infancy stage and excited to learn more and do deals.
Best,
B
My advice is to never give up, be relentless and aggressive but professional and sincere. Tailor each resume/cover letter for the particular firm and role specifically. Do your homework on the company culture, vision, leaders, etc. I think a Masters is a great idea but not if it's going to eliminate your real life work experience...Even if you are a commission only brokerage/consultant role with a top shop (ie: JLL, CBRE, Cushman, etc.) - stay employed and DO DEALS. There is no degree that can ever replace transaction experience and procuring business relationships. Networking (in person events, meetings, linkedin, etc.) is also very important. I've kept in touch with all of the industry professionals I have met since I started in the business, which has helped tremendously.
I found the role online, posted on the "open positions" section of their website. Other great resources include selectleaders.com, doostang.com and I was using indeed.com to broadly search all sites. It might be a good idea to narrow down the type of firm you think your skill set fits best with, then figure out who are the players that are growing (not shrinking or hiring freeze) then see if there are open positions and see who does the hiring, who runs the place, do you know anyone there, referrals are great but these positions can be won without a referral too... Never give up.
Thanks for the advice nycap. I've done just that and have been making a list of all the shops I've read about or come across. Though it's sometimes a bit difficult as these small to mid-tier firms (sometimes even larger REITs) often don't have careers or HR departments. Did you ever consider or use a recruiting agency? It seems like many of these buy-side RE shops rather just find their talent through a headhunter or use job boards like Selectleaders.
I'm curious on the fact that your shop is moving away from the gateway trophy markets and into more secondary markets. Given that, are you guys just mostly focusing on the major four food groups then? It seems a lot of the deals I've seen recently are just that; best available class A assets in 2nd or 3rd tier markets. Also, if you don't mind me asking, given the market, what kind of mezz returns do you guys typically seek? 5-7 year investment horizon? IRR?
Thanks!
Rana,
We have no preference to asset type including: retail, office, multifamily, industrial, though our most recent transactions have been multifamily. For mezz we look for mid teens returns and a 1.5x, at least 3y hold and out by 5-7 max but it depends...if we can negotitate an upside split and believe in the project then we would take a cheaper coupon say 10-12%...
global private equity real estate
nycapitalmarkets wrote: I
I think the pay is fairly similar if not the same to classic PE and it really depends on the shop regarding comp structure. I've been reading a lot about salary increases and bonus decreases... other firms may be doing the opposite. Obviously if you can negotiate carry that would be ideal but I don't think there are many entry level analyst/associates that are doing that these days... I am not an expert in this dept. though as I am new myself...
I would say that the pay varies greatly in REPE, much more so than in PE. At the larger opportunistic REPE funds pay will typically be be more in line with corporate PE, but as you move into smaller shops or into value-add funds it's all over the map.
RE_Banker
I think the pay is fairly similar if not the same to classic PE and it really depends on the shop regarding comp structure. I've been reading a lot about salary increases and bonus decreases... other firms may be doing the opposite. Obviously if you can negotiate carry that would be ideal but I don't think there are many entry level analyst/associates that are doing that these days... I am not an expert in this dept. though as I am new myself...
I would say that the pay varies greatly in REPE, much more so than in PE. At the larger opportunistic REPE funds pay will typically be be more in line with corporate PE, but as you move into smaller shops or into value-add funds it's all over the map.
Yep - I'll go one step further and say that it not only varies greatly, but in general is much lower than corporate PE. Exception to this is the large opportunistic funds as RE_Banker said.
Not to hijack the thread -
Not to hijack the thread - but it seems like someone should mention that hiring in REPE (and RE in general) is still a fraction of what it was pre-2009. Obviously finance overall is more competitive these days, but RE was among the most devastated - and hiring hasn't come back despite the uptick in asset valuations.
I've been in REPE for 5+ years now at a better known firm, and we've hired very few analysts/associates over the last several years. Networking and experience are still key to break in, but just want to make sure no one had any illusions about prospects.
Also agreeing with the suggestion that RE should be its own forum section. It really is a completely different animal.
Question for you. I just
Question for you.
I just started as an associate in the asset management group of a large REPE institution--think BX or similar. I'm still learning exactly what my responsibilities will be. A lot of our legacy investments are under water so a lot of work is being done on recaps, dispositions, etc. Our group also has to make approval for any decisions made by our JV partners (most of our investments involve partnering with a JV partner that earns a promote). And then our more tedious activities include creating business plans / approving budgets at the end of the year, reviewing appraisals, etc.
My question is this. How much does being in this group pigeonhole me into being in asset management for the rest of my career? Do responsibilities become more fluid as you move up the chain--e.g. getting involved in acquisitions? Would it be possible perhaps to move into an acquisitions role, if not at my current company than at a different one?
Also, what can I do to really set myself apart from my peers?
prnz wrote: Question for
prnz wrote: Question for
global private equity real estate
Do you work at Partners Group