RE Finance --> REIB
Hello gents,
I'm finishing up junior-year OCR season at my target, and lady luck hasn't been on my side. I've had 5 or 6 first round interviews with BBs mostly for capital markets roles, and only 1 superday. Im wondering what I can do during the summer to better my options for IB (hopefully REIB, but beggars can't be choosers)?
I have a 3.5~3.6 GPA, but because of my circumstances its possible for me to break 3.7~ for fall recruiting. I have two previous finance internships with no modeling, but I have taken Corp Finance/other finance courses.I know the best way to set up my resume at this point is to intern at a boutique over the summer, but OCR hasn't been so helpful with that.
Has anyone here had experience cold-networking with boutiques and landing summer positions? Also, does REIT experience look valuable for i-banking?
Working for a REIT would look decent if you got some modeling experience, but NOTHING beats working for a boutique bank to break into banking. Even if you want to work in a lodging/gaming coverage group, first you need to figure out how to get into IB at all to begin with.
Anyone familiar with RE Investment Banking boutiques in NY? Im going to try and network my way into boutiques, but if I can shoot for Real Estate in particular that would be fantastic.
Anyone? I've noticed Eastdil and Chester Field, Im sure there must be more REIB groups in NYC?
PM'd you
REIB is a weird animal, definition-wise. It can mean corporate/REIT level advisory work (e.g., advising REITs on acquisitions of other REITs, portfolios, IPOs, HoldCo level financings, general IBD work) or it can mean basically being a glorified broker (shitty asset level financings, sales of some redneck's strip club in Talahasee....) the former is generally performed in a real estate group in a big global investment bank. Eastdil plays more in the latter. Nothing against those guys - they're the best at what they do. But you should know Eastdil REIB could mean pitching CMBS shops on shitty $20 mm mortgages.
It really depends on how much you want to be involved in the sticks and bricks real estate world, and how much you want to be involved in the high level corporate world with sort of a "real estate twist" to it. Eastdil will definitely teach you real estate, and after a couple years at Eastdil you'll definitely know a lot more about actual real estate than an analyst at an investment bank in a real estate group will. If the eastdil route is appealing to you, you should look into CBRE's wheel program. It's like a rotational real estate program that will teach you everything about the space from an asset perspective. Lots of real estate families have their kids do their couple years in it.
Plenty of money in both worlds. Corporate side is a little bit more stable, squash-playing good old boy taking down a nice banking check but never getting fuck you rich, sticks and bricks is the scrappier entreprenurial side where you can make some equity money, or you can flame out.
And keep in mind the line can get pretty blurred when you take into account that most banks with REIB groups have internal CMBS groups, and they work together on many transactions, especially the big ones. A CMBS group generally won't write a fixed rate mortgage with less than 2 points of profit built in for fear that rates move against them before they can execute the securitization, sometimes they'll go tighter on a marquis transaction, but even assuming 150 bps, when you're talking about a couple hundred million, that's more than enough P&L to make it worth it for REIB to try to take some credit for the deal. Plus, many real estate financings are done by big players that also have banking/corporate relationships - your Brookfields, GGPs, Simons, Paulsons and Blackstones of the world, and real estate is often financed as part of a major corporate buyout. The line gets pretty blurred in real estate.
Very interesting
@NYCbander, would the corporate side look down on experience at a firm like Eastdil if I decided to exit and enter into traditional REIB or REPE?
For example, if I interned at a shop like Eastdil or GGP over the summer and decided to join in on Fall Recruiting for the BBs, would the experience still be valuable for BB REIB groups or would they prefer someone with vanilla boutique IB experience?
Well, first of all, GGP and Eastdil aren't the same thing by a long shot. GGP is the premeir owner/operator of commercial retail space in the US hands down. GGP owns all the highest quality malls in the US, Goldman recenty did a ~$1.3 bn (if memory serves) deal for them, GSMS 2012-ALOHA, on the Ala Moana mall which is arguably the number one mall in the country, and if I had to guess I'd say it brought GS a ~$20mm payday. Eastdil is a broker. GGP is the buyside promised land, if you're at GGP, I don't know why you'd want to jump ship to banking.
Nobody will look down on either of those experiences, but in today's environment, it's always a long shot trying to go to a BB FT if you didn't intern there. Part of the reason is that even if the REIB guys would recognize and respect your internship, your resume has to get past HR to land on their desk, and HR isn't going to know who the players are. I would say if you do either Eastdil or GGP as a sophmore internship, it will be a great resume builder for junior year. If that's your junior year internship, you're better off gunning for the FT offer at eastdil/GGP and then making the jump to banking in a few years as an associate if that's still appealing to you. It probably won't be once you've got the lay of the land a bit.
If you're choosing between Eastdil and GGP, go with GGP unless the Eastdil offer is better. Both are respected shops in the RE world, but GGP is buyside, and Eastdil broker types are kind of viewed as lower than bankers.
Oh Im not choosing anything at the moment I've been getting contacts to call next week and sell myself for any openings. Yeah BB FT is rough although I might be able to get past HR if I network, I go to a target undergrad so the banks do come to campus in the fall.
If not, maybe I can lateral into a top MM / BB a year into a boutique stint, from this site I gather that all the best buyside gigs recruit solely from BBs and elite boutiques. Im guessing its the same for RE.
A few things:
1) HR won't throw out your resume because you have a 3.7 at a target. However bankers could still pass it over if you don't sell your experience 2) Google "top 100 commingled real estate funds" and call everybody there. The buy side could still take you for the summer if you are compelling enough and go unpaid 3) Yes, it's possible to go from RE finance to REIB. BUT keep in mind that prestige still matters, so BX and MS for example, have awesome REPE and you can lateral to banking easily from them. But other places may be harder. 4) Make sure you do RE finance rather than pure property level work. You have to position yourself as a finance guy who knows RE, not as a RE guy who now wants to do finance. 5) Don't tell BBs in the fall that you only want the REIB group. This is extremely dumb because their REIB may not need anyone, especially for FT recruiting which is smaller scale than SA recruiting. Tell them you're partial to REIB but would be thrilled to do any group at such a great bank.
Best of luck!
Got it, thanks!
If you end up with the REIT only, it would be look decent, but Boutique would be preferable. 3.7 at a target in the fall of senior year with REIT experience would give you options for BB if not MM. I did RE modeling at a small shop summer before my senior year and had offers from MM at a non-target. PM me if you have additional qs.
http://www.cmalert.com/headlines.php?hid=155209
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