I currently work at a well known REIT in a major market. My prior experience includes Investment Sales/Transaction Advisory experience at a major brokerage firm also in a major market. In total I have about 4 years of CRE experience. Thus far the vast majority of my experience is Asset/Portfolio level experience vs. buying REOC's etc.
My goal is to transition to a REPE firm in a few years. From what I have seen the vast majority of REPE funds out there are indeed asset level shops. Even the ones that do more complex entity level deals still do asset level transactions. From what I have seen at LinkedIn, even at big shops (CIM, Fortress, Carlyle, Cerberus) Investment professionals come from a mix of traditional REIB or asset level backgrounds.
Can someone confirm the above? Also, I would assume comp at all the places above is fairly similar?
If REPE is my eventual goal does it make sense for me to get an MBA and go to traditional REIB to get entity level experience or should I just stay my course? The way I see it Real Estate M&A and IPO's are a very small part of the business and I would end up doing a lot of financing work in REIB anyway.
How valuable is entity level experience in this business? Would it change my prospects for compensation 10 years down the road?
At this point in terms of further buyside options even if I got an MBA I most likely am only a candidate for real estate oriented roles anyway so if I can do without it I would prefer it.
Any advice would be appreciated. Especially someone who has more of Traditional REIB background and is now in REPE.
Thanks.
You should try to network with professionals at the shop you work at to get a feel for what they're looking for. Otherwise, I don't think going to a MBA is worth it if REPE is your end goal and you're in the industry already. An alternative would be go to a one year MSRE program but I would try to lateral in directly. RE is an industry where you have to network anyway since all the players in industry know who each other are.
MSRE doesn't work at all, MBA is much more helpful. I just graduated from a top MSRE program, most of my classmates get really shitty jobs. Only few go to decent pere.
i don't work in REPE and have never worked in REIB so i'm talking out of my ass here, but to me the obvious answer here is to try your damnedest to weasel into a good REPE shop without the MBA. doesn't have to be the biggest fund on the street either; a small but highly respected REPE shop would still be awesome. i downplay the entity-level experience for the exact reason you mention; there are plenty of 'top dogs' in REPE without entity-level experience. obviously you might get different answers on this from others, though. the guy who went to HBS and works at BX might tell you to get the MBA and do your time in M&A.
Thanks for the comments.
Prospie, I agree with your line of thinking. Currently, I am leaning toward trying to make the leap without going MBA/REIB as soon as I have spent enough time at my current shop and am ready.
In my current role I feel as though I am getting great experience in sourcing, underwriting, negotiating, and selling a deal to our investment committee. The hours are reasonable and I am playing a real role in the deal process.
The idea of spending upwards of 200k plus lost income on an MBA in order to go to REIB and work upwards of 80-90 hours a week and without the promise of doing meaningful work does not seem that appealing to me. Additionally, traditionally I don't see brokerage shops/REITs (my experience) being a natural feeder to HSW or an MBA business schools">M7 for that matter, so I would really be aiming for T15 given all my stats.
Any more comments or advice from people with experience in this would be greatly appreciated!
And then another 60-75 hours a week at a top REPE
prospie has some good feedback above. Both backgrounds are good and I've stated this on other threads so I don't want to totally rehash, but in my observation, if the experience is 'good' (meaning a quality team with good deal flow) an investment sales/asset level background is going to result in a shorter learning curve than REIB, usually from both a modeling and technical/market knowledge perspective. Both backgrounds would be generally well received.
For the MBA question, I think it really depends. Where I'm at, almost none of the top guys have MBA's, and we are a 'PERE 50' shop. There are other firms that hire exclusively out of MBA. Really depends on where you want to end up. Would say it can't hurt you, but not necessary in every instance.
Thanks for all the feedback.
I am seriously considering putting the MBA on hold for now and seeing what I can come up with in terms of next steps.
The thing about the MBA is that it's all about where you do it. If you can get into top 3 it's a no-brainer. If you can not get top 3 but you get MBA business schools">M7 it's worth consideration. If not MBA business schools">M7 than absolutely do not go.
Thanks. Are you saying the above given my particular circumstances,work history, and goals or you think in general a T15 MBA is not worth it for anybody?
RE Financial Modeling REIB vs. REPE (Originally Posted: 01/20/2016)
Just wondering if there are a lot of similarities between the two and if certain courses are better for each? REIB deals with REITs rather than individual properties, so I'm assuming it is a bit more complicated.
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They would be completely different. One is the valuation of a company, the other is the valuation of a property.
RE career question- RE Banking vs. REPE (Originally Posted: 12/23/2007)
Some good real estate PE shops like Blackstone and Walton St. recruit straight out of undergrad. If one were to have offers from all the major banks in their Real Estate banking coverage groups (not capital markets/CMBS)would you rather do the 2 years in banking and then go to Blackstone/Walton/Carlyle/Apollo/Whitehall/MSREF or just go straight to the REPE funds that recruit straight from ugrad?
Or are there certain banks you would be indifferent or more in favor for (GS/MS)?
first off, I've heard Whitehall and Carlyle aren't quite at the level of Blackstone, so keep that in mind...
and second of all, I think the main reason to do REIB over REPE is to avoid further pigeonholing yourself, because that will happen if you go into REPE. Otherwise, though, my opinion is that it would be silly to go into banking if you had the chance to go straight to a place like Apollo.
Shops like Apollo and Carlyle don't take kids out of ugrad, but I was just curious as to whether if I was somehow by an act of God able to be recruited as a graduating senior to Blackstone if I would take it over something like REIB @ Morgan/DB/GS/LEH/LAZ etc.. just because a lot of of the management profiles seem to indicate they all did REIB before moving to PE.
Thanks again for the advice though. Any other takers?
does LAZ not recruit undergrads for REPE? I seem to remember that...
Go straight to REPE.
It is a step above the banking world. Why start kindergarden when you can skip to 3rd grade?
BUT only do it if you really like real estate. In banking, different industry verticals can operate similarly, so crossover is possible if you want to move into a different group. In REPE, you would be making more of a commitment to RE.
Thanks REbanker. Hope the job search is going well.
The only reason I had concerns over jumping straight to REPE was that I would not get the corporate finance training one would get on the banking side. For example, for the Blackstone-Hilton deal, it is more corporate finance than real estate, although a lot of the underlying asset is real estate (and again the complexities of hotels being operating real estate assets). I would think that the typical analyst at a small REPE shop wouldn't have the know-how to do such a large deal but would be more comfortable in acquiring single assets and/or portfolios but nothing large like the Hilton brand.
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