real estate private equity vs. real estate development
IB
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(Senior Gorilla, 967
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on 3/15/11 at 10:02am
What are the main differences between these two? It sounds like both buy real estate property, improve, and sell at a higher price. Besides use of leverage / LP structure (REPE $ comes from pensions etc. and charge 2/20 while developers use own money) aren't they really similar?





There is a huge difference
There is a huge difference between the two, having done both in a past life.
Think of REPE as primarily capital allocation - buying income-producing assets directly, buying operating platforms, funding developments for developers, etc.
RE development is the actual down and dirty real estate process. The capital allocation decision occurs early (deciding to go forward with a project) and is a relatively small part of the process. The bulk of the process involves obtaining entitlements, design, and then actual construction.
There is a continuum between the two ends, though, with many companies somewhere in the middle doing a mix of both.
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Big difference. jqbuyside
Big difference. jqbuyside sums it up nicely. Development is the much more nitty, gritty side of real estate investing. It requires somewhat of a different skill set than the classic pension fund advisory work of acquiring stabilized, core assets w/ low leverage.
hows comp for both?
hows comp for both?
JimboUSC wrote: hows comp for
hows comp for both?
I can speak for the Development side if anyone wants to PM me.