Q&A: Head Research Analyst (Commercial Real Estate)

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M
Rank: The Pro | 47,398

I am the Head Research Analyst at a regional office of one of the best commercial real estate services firms on the globe. Day to day, I specialize in statistical market research, written analysis, database management, and copywriting/ghostwriting for pitches. I also serve my community on two different non-profit boards, one related to commercial real estate and one more personal. You can read more about my background after the break.

Feel free to ask anything about the various different careers in commercial real estate, day to day tasks, hours, networking into a brand name company from a non-target, with a "soft" major, or with bad grades, or well as back office to front office transitions.

Far from a brag story, I was a political science major/economics minor with poor grades from a far beyond target local state school and was turned down, ignored, or free internship offered from over four hundred different jobs. Luckily, while in college I was instrumental in a multi-million dollar development project while on the board of directors of a 501(c)(3) corporation, lead the entire student body as Student Government President, gave a monthly speech to administrators and professors as Vice Chairman of the University Senate, and served on numerous other financial boards and committees.

Through a series of reality checks, I realized what I could and couldn't achieve right away, networked my ass off, was ready to take advantage of any opportunity at a moment's notice, and have never looked back. I will be completing my back office to front office transition into office leasing and investment sales within the month and have already been pre-emptively assigned to a 1,500,000 square foot office complex.

Comments (92)

Apr 23, 2013

This kind of an off-hand question, but when you refer to market research, do you mean GIS demographic data of given areas? Where do you get the data, from a Third-Party or an application organic to the firm?

Apr 23, 2013
Lambie:

This kind of an off-hand question, but when you refer to market research, do you mean GIS demographic data of given areas? Where do you get the data, from a Third-Party or an application organic to the firm?

I do GIS stuff, a lot of market predictions based off of absorption & deliveries, lease and sale comps, and a good bit of "hey, we need a list of XXX, make it" (examples: REITs specializing in multi-tenant properties, current class C downtown office tenants with leases expiring over the next year, etc.)

The data is a combination of CoStar/Loopnet info, main office company info, and proprietary local office info.

Lambie:

Solid post by the way, we needed a Commercial RE interview on the site. +1 SB mate.

Thanks, brother. Hopefully this goes well. I'm sure it'll be smaller than the banking interviews, but still

    • 1
Apr 23, 2013

Solid post by the way, we needed a Commercial RE interview on the site. +1 SB mate.

Apr 23, 2013
Lambie:

Solid post by the way, we needed a Commercial RE interview on the site. +1 SB mate.

This is ridiculous, it's like CRE reads my fucking mind. I was just looking through the RE forum for an interview post...

Apr 23, 2013

How much wood could a woodchu... just kidding.

A few questions for ya:

1) What do you like most about CRE?

2) Where do you go from your current position? How does your career trajectory look?

3) What sets a candidate apart from others? Specifically in your case, did the leadership positions just outweigh your shitty GPA or did you wow them in the interviews?

4) What's the difference between working at a regional office vs the corporate headquarters? In terms of lifestyle, responsibility, career trajectory, etc.

Apr 23, 2013
D M:

This is ridiculous, it's like CRE reads my fucking mind.

haha! don't you forget it!

D M:

How much wood could a woodchu... just kidding.

A few questions for ya:

1) What do you like most about CRE?

2) Where do you go from your current position? How does your career trajectory look?

3) What sets a candidate apart from others? Specifically in your case, did the leadership positions just outweigh your shitty GPA or did you wow them in the interviews?

4) What's the difference between working at a regional office vs the corporate headquarters? In terms of lifestyle, responsibility, career trajectory, etc.

1. Three things.

First, I like being able to point to a skyscraper and on some level say "that's mine. I did that." Soon enough I'm going to be leasing it. Maybe someday I'll work for a place that buys it or I'll sell it to them. I was always the kid growing up who would walk through half-built houses for fun.

Second, I like that you can "break in" how I did. I never could have gotten hired at a bulge bracket bank but I'm nowhere near the person who puts down the Princeton to Goldman to HBS to Blackstone guy and in a lot of ways I suppose I'm jealous of that progression. I just know it's not me. Instead of getting grades in highschool I was playing sports and video games. Instead of getting grades in college I was drinking with girls and building a resume. I've always been more execution oriented, preferring projects over studying, and if something was a waste of my time (read: half my classes) I just didn't care or do it. Immature? You bet. But I made the most of it.

Third, I like the variety. Brokerage, REITs, REPE, Development, In House (although I personally wouldn't do that.)

2. I was hired in research because I didn't have experience out of college and they didn't want to make me a broker right away knowing that I didn't know anything and couldn't produce. I've read anywhere from 70%-90% of people burn out of brokerage their first year and I got lucky enough to work for guys who don't want to see that happen. There was always the intention that I transition to brokerage and I am in the process of that transition. From here, I'll be a broker, more likely than not specializing in office leasing, but also with some investment sales thrown in there. I got put on a Class B building complex team with 1,500,000 sf and I just today sourced and set up a meeting with a HUGE potential client. Big time, not regional either.

3. As with most things I assume (not an expert on this), you have to prove you can do the job before you get hired. CRE brokerage is personality, connections, and persistance. I got my job through bothering the hell out of the principals (politely of course), using the one connection I had, and by acing the interview that was 99% "fit." Grades, luckily, never came up.

4. My company (and I'm sure others) are interesting in that the headquarters isn't the most impressive office, if you will. Colliers is based out of seattle, JLL is based out of chicago, CBRE is based out of LA, etc. and with the exception of maybe CB I'm sure New York is the biggest office for all of them. The difference in working at a regional office is size, difficulty of breaking in, and money. The size is actually a benefit to me - I love the smaller office feel. Difficulty of breaking in was a benefit to me too.

The money is the only rough thing. 4% of a $2,000,000 listing is a $80k commission. 4% of a $200,000,000 listing is a $8 million commission (like those math skills?). Bigger markets = bigger incomes in general, although there are other factors that play into that as well.

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Apr 23, 2013
CRE:

Second, I like that you can "break in" how I did. I never could have gotten hired at a bulge bracket bank but I'm nowhere near the person who puts down the Princeton to Goldman to HBS to Blackstone guy and in a lot of ways I suppose I'm jealous of that progression. I just know it's not me. Instead of getting grades in highschool I was playing sports and video games. Instead of getting grades in college I was drinking with girls and building a resume. I've always been more execution oriented, preferring projects over studying, and if something was a waste of my time (read: half my classes) I just didn't care or do it. Immature? You bet. But I made the most of it.

Wow that describes me perfectly.

Apr 23, 2013
CRE:

The money is the only rough thing. 4% of a $2,000,000 listing is a $80k commission. 4% of a $200,000,000 listing is a $8 million commission (like those math skills?). Bigger markets = bigger incomes in general, although there are other factors that play into that as well.

I'm pretty sure this isn't how CRE commissions work. I'm sure it varies from company to company, but there's no way you'd consistently win competitive bids with 4% commissions. On large CRE deals ($20 mm +) you're talking about negotiating flat fees or micro fees at the beginning, e.g. $200,000 to sell the $50 million industrial complex, or something to that effect. People don't walk away with $8 million commissions. If they did, the industry would be flooded with the Ivy League's top minds, and it's definitely not.

Apr 23, 2013

What are your thoughts on Hanley Wood and Metrostudy? Which one do you prefer and how has their merger affected your usage of them?

Apr 23, 2013
Pinkpoloshorts:

What are your thoughts on Hanley Wood and Metrostudy? Which one do you prefer and how has their merger affected your usage of them?

Honestly, I use neither.

Apr 23, 2013

This is a great AMA. Your college experience sounds extremely similar to mine. I managed to land myself an analyst position at a very small, but successful shop doing CRE investment and consulting. I'm now looking to lateral out into distressed debt investing and NPL's. I have an interview with a top shop later this week, and would like to know what may play to my advantage in this interview from a senior person such as yourself. I have a very good understanding of CRE valuation, as well as a strong command of the terms in the industry, but would like to know a little bit more of the technical aspect. What are the most common ways in the industry of working out a loan to maximize NPV? It seems like there are many less opportunities for banks and PE funds to invest in NPL's in the states this year compared to last, though opportunities a continuing to arise throughout Europe? Furthermore, while we have seen values coming back to pre-recession levels, and even above them in some markets (NYC, LA, Chicago), much of the real estate loaned on pre-recession is still depressed. With the looming maturities in the next few years, combined with depressed property values, resulting in less homeowner equity, reducing the likelihood of being able to refinance, and the possibility of default we may see more activity in the NPL market?

Apr 23, 2013
thenine93:

This is a great AMA.

Thanks, man. Hopefully it's the first CRE AMA of many.

thenine93:

Your college experience sounds extremely similar to mine. I managed to land myself an analyst position at a very small, but successful shop doing CRE investment and consulting.

Yep. CRE is far less pedigree based. If you want it bad enough you can break in. I guarentee it to everyone. (and I mean the industry. I'm not talking about myself in the third person)

thenine93:

I'm now looking to lateral out into distressed debt investing and NPL's. I have an interview with a top shop later this week, and would like to know what may play to my advantage in this interview from a senior person such as yourself.

Congrats! Any experience in the industry is going to play to your advantage, but I'm not a senior guy here, just the senior analyst. Still bottom of the totem pole for now. I graduated college in May 2012.

thenine93:

I have a very good understanding of CRE valuation, as well as a strong command of the terms in the industry, but would like to know a little bit more of the technical aspect. What are the most common ways in the industry of working out a loan to maximize NPV? It seems like there are many less opportunities for banks and PE funds to invest in NPL's in the states this year compared to last, though opportunities a continuing to arise throughout Europe? Furthermore, while we have seen values coming back to pre-recession levels, and even above them in some markets (NYC, LA, Chicago), much of the real estate loaned on pre-recession is still depressed. With the looming maturities in the next few years, combined with depressed property values, resulting in less homeowner equity, reducing the likelihood of being able to refinance, and the possibility of default we may see more activity in the NPL market?

While this might not be what you want to hear, I don't want to bs anyone. There's a chance you could know more about overall market trends than I do when it comes to the financing behind the deals. I personally don't deal in getting the loans together at all.

Honestly too, we use IRR a lot more than NPV (even though NPV is probably more accurate) for simplicity.

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Apr 23, 2013

What would be more useful in your field an undergrad accounting degree with CPA or just an undergrad finance degree?

Mps721

Apr 23, 2013
Mps721:

What would be more useful in your field an undergrad accounting degree with CPA or just an undergrad finance degree?

I'd lean towards finance although either are good ideas. General business/market understanding is more important really.

Apr 23, 2013
CRE:

I also serve my community on two different non-profit boards, one related to commercial real estate and one more personal.

Just curious, are the non-profit boards a way for you to get more business? If so, how does one start doing something like that? Do you have to give them a certain amount of money each year? Thanks for doing this.

''You can fool some of the people all of the time, and those are the ones you need to concentrate on.'' -- President George W. Bush
0.5 bb

Apr 23, 2013
Dubya:
CRE:

I also serve my community on two different non-profit boards, one related to commercial real estate and one more personal.

Just curious, are the non-profit boards a way for you to get more business? If so, how does one start doing something like that? Do you have to give them a certain amount of money each year? Thanks for doing this.

Non-profits are great ways to get your name out and network. Like I said, one is straight forward "I'm doing this for business purposes" and it's a neighborhood development board so everyone is ok with it. The other is for my own good karma and because it's a cause I care about.

Both help me "do good" while at the same time boosting my resume. I'm hoping to go to business school over the next couple years.

Oh and ya they're going to want money. Pushing that off as much as possible though, hah

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Apr 23, 2013
CRE:
Dubya:
CRE:

I also serve my community on two different non-profit boards, one related to commercial real estate and one more personal.

Just curious, are the non-profit boards a way for you to get more business? If so, how does one start doing something like that? Do you have to give them a certain amount of money each year? Thanks for doing this.

Non-profits are great ways to get your name out and network. Like I said, one is straight forward "I'm doing this for business purposes" and it's a neighborhood development board so everyone is ok with it. The other is for my own good karma and because it's a cause I care about.

Both help me "do good" while at the same time boosting my resume. I'm hoping to go to business school over the next couple years.

Oh and ya they're going to want money. Pushing that off as much as possible though, hah

Wow, I just read in one of your other responses that you graduated last year. I thought you had to be like 40 years old or something to be on boards like this. I had no idea, so thanks for the tip.

''You can fool some of the people all of the time, and those are the ones you need to concentrate on.'' -- President George W. Bush
0.5 bb

Apr 23, 2013

How does one start, if he or she wants to get involve with community service?

How did you manage to get on their board?

Apr 23, 2013
TheTwoHacker:

How does one start, if he or she wants to get involve with community service?

How did you manage to get on their board?

Most boards are horribly underfunded and understaffed. All I did was contact them.

It's actually somewhat more depressing the calibre of people on these boards. I'm not getting as much out of it as my idealism wanted.

  • Anonymous Monkey
  •  Nov 18, 2015

22 and about to be a board member- though not the case with THIS board, I find it to be the case with a lot that I've interacted with :/

Apr 23, 2013

I'm not sure if I like real estate, or rather, like the "idea" of real estate. I've had quite a bit of real estate coursework in college (Minored in RE) and thoroughly enjoyed it, but no direct work experience. Besides trying to get staffed on real estate - related clients/projects, do you have any recommendations on how to get real-world experience?

Would joining the ULI (or similar groups) be useful for someone interested in RE, but working in a different industry?

How do you feel the learning opportunities differ for analysts in transactions vs. operations. My goal is to learn as much as I can during the first few years, and then leverage my knowledge after that. Given this, would working in asset management/strategy be the areas that I should focus on?

Thanks in advance! (I too feel that we need a lot more RE on the site)

Apr 23, 2013
RealAnalysis:

I'm not sure if I like real estate, or rather, like the "idea" of real estate. I've had quite a bit of real estate coursework in college (Minored in RE) and thoroughly enjoyed it, but no direct work experience. Besides trying to get staffed on real estate - related clients/projects, do you have any recommendations on how to get real-world experience?

Would joining the ULI (or similar groups) be useful for someone interested in RE, but working in a different industry?

How do you feel the learning opportunities differ for analysts in transactions vs. operations. My goal is to learn as much as I can during the first few years, and then leverage my knowledge after that. Given this, would working in asset management/strategy be the areas that I should focus on?

Thanks in advance! (I too feel that we need a lot more RE on the site)

What would you be looking to do in CRE? It's a different answer depending on what the endgame is. What I do is a lot different than what the guys here in REPE do. (Hopefully they do a AMA too!)

It never hurts to get involved though

Apr 23, 2013

If at all possible though, I don't want this to turn into an argument thread. For those reading, I'd take this as "different companies and markets have different ways of doing things." CRE is a lot less lockstep than banking, even in the same market.

Also, feel free to shoot me PM's

Apr 23, 2013

7 figure commissions might happen, but they are gross outliers. A good CRE broker is making $300-400k per year. One of the nation's top brokers is making 7 figures. The point I'm making is that you should be careful to not present a false picture of the industry. 80-90% of CRE brokers can't pay their rent. It's a tough gig.

Apr 23, 2013
DCDepository:

7 figure commissions might happen, but they are gross outliers. A good CRE broker is making $300-400k per year. One of the nation's top brokers is making 7 figures. The point I'm making is that you should be careful to not present a false picture of the industry. 80-90% of CRE brokers can't pay their rent. It's a tough gig.

On this we can agree for the most part (although I argue that there are more people making 7 figures annually than you think). I was more or less just trying to say "bigger markets pull bigger commissions"

The point DCDepository makes about most people flaming out is 100% true though.

Apr 23, 2013

have to agree - CMBS analyst here - have seen big liquidations - the brokers get flat fees when Trusts liquidate portfolios and we're talking BPS rather than full % - this was a $1B+ portfolio

Apr 23, 2013
robjob:

have to agree - CMBS analyst here - have seen big liquidations - the brokers get flat fees when Trusts liquidate portfolios and we're talking BPS rather than full % - this was a $1B+ portfolio

Yes, no one would pay a percentage on a $1B+ portfolio

Apr 23, 2013

Cool story

"It is our fate to be tormented with large and small dilemmas as we daily wind our way through the risky, fractious world that gave us birth" Edward O. Wilson.

Apr 23, 2013
crowe:

Cool story

Hah, I don't even get a ", bro" at the end? Disappointed

Apr 23, 2013

The person who PM'ed me can take credit for this if her or she wishes, but I think they're good questions:

Really thankful you're doing this thread because I'm in a very similar situation. Reason I'm pm'ing is I feel people are under appreciating your responses and preferring to argue commissions. That said, I have a few q's if you don't mind:

1. What software do you use most and would an applicant with Argus certification really stand out?

2. Why did you choose CRE brokerage, and how do ou feel the outlook is for someone looking to break in and make good money?

3. How did you stay motivated in your job search?

4. Do you have any student debt, and how much $ do you think you'll take in this year?

As far as arguing commissions, I did oversimplify to prove a point and I appreciate people not wanting me to be misleading, but I agree that's kind of neither here nor there. Those commission numbers do exist and I never said they were regular occurances.

Now to your questions, PM person:

1. Excel, easily. That being said, someone with Argus certification would stand out very much. There are only a handful of people here with it (I'm working towards it).

2. I think it fits my personality. Coming out of school, I applied to banking, consulting, advertising account executives positions, developers, brokerage, and some random companies along the way. I probably would have been content with any of those, but CRE brokerage more or less chose me as it was. Luckily, I enjoyed doing the development project in college and I really enjoy it now. I'm a people person. Dealing with clients is fun to me.

3. Blind self confidence. If anything, confidence is something I do not lack at all, and I took the same "oh you don't want me? well your loss" approach to jobs that I take to women. It was rather depressing at times of course, but just pressing on and continuing to work toward the goal of getting a job was motivation enough.

4. I have around $40-$50k in debt from undergrad. It is mind numbingly awful and crushes my take home pay. As far as money, it's hard to tell. Once I become a broker, I'll be pulling in commissions (on a low split plus my salary to close out the year then on a good split on a draw next year) and I'm on a great listing and just single handedly set my office up for a couple potential big-time national listings today. Thing with CRE though - these could close in a month or 18 months. You just never know.

    • 1
Apr 23, 2013

Commissions are for closers!

Apr 23, 2013
karypto:

Commissions are for closers!

LOL. If I knew how to imbed I would put in the Glengarry Glen Ross scene from youtube.

Apr 23, 2013
DCDepository:
karypto:

Commissions are for closers!

LOL. If I knew how to imbed I would put in the Glengarry Glen Ross scene from youtube.

hah, get out those brass balls

Apr 23, 2013

Just a couple questions.

If I want to do RE IDB at a MM or BB company and missed out on Junior year SA recruiting; how will doing a summer at one of the large brokers in their Capital Markets Investment Sales group covering NYC look for FT IDB recruiting.

Also what is the typical pay and bonus for Analyst within the capital markets group at the big real estate brokers.

Thanks

Apr 23, 2013
ct banker:

Just a couple questions.

If I want to do RE IDB at a MM or BB company and missed out on Junior year SA recruiting; how will doing a summer at one of the large brokers in their Capital Markets Investment Sales group covering NYC look for FT IDB recruiting.

Also what is the typical pay and bonus for Analyst within the capital markets group at the big real estate brokers.

Thanks

I can't really speak to the IBD stuff (feel free to chime in, anyone else) but analyst pay is dependant on market and firm and varies a lot more than banking. For instance, glassdoor lists salaries from below $40k to above $150k http://www.glassdoor.com/Salaries/capital-markets-...

In general though, I'd say salary compares to banking but bonuses are smaller. Still, it varies so much

Apr 23, 2013

Can only comment prior to the restructuring, but from my understanding the splits at Colliers were considerably more attractive than JLL & CBRE for those considering (60/40 to company $350)- much more corporate structure at the latter two companies; might be a non-factor these days. Also, CBRE culture is more "me against the world" than JLL & Colliers who tend to be more team oriented (2 head brokers + a runner, 2 juniors, etc.). I mention this not b/c one is better than the other, but everyone is different ie if you're in banking CBRE could be a better fit for you..

Question for CRE re: transition.. will you be joining a "team" or going solo? Kids that tend fail early are the ones who get into brokerage solo and unless they have serious connections, are mormon (door knocking), or are willing to make nothing for 6+ months they tend to be SOL. I can't stress how impressed I am that you realized the value of a steady pay check + a better understanding of the market. You will do well.. Good luck to you my friend and I look forward to hearing from you

    • 1
Apr 23, 2013
colmckai4444444:

Question for CRE re: transition.. will you be joining a "team" or going solo? Kids that tend fail early are the ones who get into brokerage solo and unless they have serious connections, are mormon (door knocking), or are willing to make nothing for 6+ months they tend to be SOL. I can't stress how impressed I am that you realized the value of a steady pay check + a better understanding of the market. You will do well.. Good luck to you my friend and I look forward to hearing from you

You better believe I'm going to be teamed up with a principal (who I get along with really well, I might add). I do the leg work he doesn't want to, he uses the connections I don't have, and we both profit as a result.

Thanks for the nice reply! Your posts about splits are interesting too. I work for one of those 3 and will be getting a 50/50 come January. Might be my market though

Apr 23, 2013

Hi,

I'm curious about the career path with respect to real estate research at a major firm.

Obviously, I see that you have chosen brokerage as your preferred career path, but for those more oriented to the research path, what does the trajectory and compensation look like over, say, the first 10 years in that capacity?

Apr 24, 2013
sofib09:

Hi,

I'm curious about the career path with respect to real estate research at a major firm.

Obviously, I see that you have chosen brokerage as your preferred career path, but for those more oriented to the research path, what does the trajectory and compensation look like over, say, the first 10 years in that capacity?

I'm betting low 6 figures at that point. Something to remember though is that it really doesn't take many people to pull off "research" though. Our office could easily get by without me and I am constantly trying to make myself useful. My company has a main office research team and they do most of the heavy lifting for all the other offices.

Apr 23, 2013
CRE:

I am the Head Research Analyst at a regional office of one of the best commercial real estate services firms on the globe. Day to day, I specialize in statistical market research, written analysis, database management, and copywriting/ghostwriting for pitches. I also serve my community on two different non-profit boards, one related to commercial real estate and one more personal. You can read more about my background after the break.

Feel free to ask anything about the various different careers in commercial real estate, day to day tasks, hours, networking into a brand name company from a non-target, with a "soft" major, or with bad grades, or well as back office to front office transitions.

Far from a brag story, I was a political science major/economics minor with poor grades from a far beyond target local state school and was turned down, ignored, or free internship offered from over four hundred different jobs. Luckily, while in college I was instrumental in a multi-million dollar development project while on the board of directors of a 501(c)(3) corporation, lead the entire student body as Student Government President, gave a monthly speech to administrators and professors as Vice Chairman of the University Senate, and served on numerous other financial boards and committees.

Through a series of reality checks, I realized what I could and couldn't achieve right away, networked my ass off, was ready to take advantage of any opportunity at a moment's notice, and have never looked back. I will be completing my back office to front office transition into office leasing and investment sales within the month and have already been pre-emptively assigned to a 1,500,000 square foot office complex.

    • 1
Apr 23, 2013

snip

    • 1
Apr 23, 2013

Where else can being an RA take you? Can you use leverage the skills to get into valuations or the capital markets?

Apr 24, 2013
christring2:

Where else can being an RA take you? Can you use leverage the skills to get into valuations or the capital markets?

Capital markets is a possibility, although I would probably need to go back to business school for that. As RE_Banker said, other parts of CRE are a bit more prestige based and I would personally want more formal training in it. I don't like being mediocre at things.

Not sure what you mean by valuations though. Appraisals maybe? I already do some valuations now.

Apr 23, 2013

Can you highlight the differences in roles between being in acquisitions versus portfolio management?

Apr 24, 2013
NavalMonkey:

Can you highlight the differences in roles between being in acquisitions versus portfolio management?

In reality - not much. Most places manage a real estate portfolio that they acquired, so there isn't really a set divide like you described. I suppose some places (REPE, REITs) aggressively acquire properties while others hold onto theirs and do more property management than anything, but there is really some of each in each.

Apr 23, 2013

Appreciate you taking the time to do this. Your postings on this sight are incredibly valued by those of us interested in real estate

Apr 24, 2013
CRE_Banker:

Appreciate you taking the time to do this. Your postings on this sight are incredibly valued by those of us interested in real estate

Thanks, brother. Hoping to help & inspire some others (in a REPE, a REIT, REIB, etc.) to do the same. This site is badass for banking, funds, and PE/VC. I want it on that level for CRE too.

Apr 23, 2013

Thanks very much for this AMA CRE! It sounds like we have somewhat similar college backgrounds. I have a strong interest in real estate and research work, so what you do sounds quite appealing to me. My background is somewhat non-traditional, as have worked in commercial construction estimating, putting together prices for projects ranging from 300k to 2 million. My degree will be in history with several electives in economics and financial accounting. I'd really like to break into a real estate position after grad school (looking at one-year masters programs now) but am not sure I will be able to break in with my background and total lack of finance internships. Any advice would be much appreciated!

Apr 24, 2013
jon1987:

Thanks very much for this AMA CRE! It sounds like we have somewhat similar college backgrounds. I have a strong interest in real estate and research work, so what you do sounds quite appealing to me. My background is somewhat non-traditional, as have worked in commercial construction estimating, putting together prices for projects ranging from 300k to 2 million. My degree will be in history with several electives in economics and financial accounting. I'd really like to break into a real estate position after grad school (looking at one-year masters programs now) but am not sure I will be able to break in with my background and total lack of finance internships. Any advice would be much appreciated!

Again, it depends on what you're trying to break into. If you're looking to work for a REIT, the lack of formal finance training will hold you back (although if you're going to masters programs...)

If you're looking to do what I do, you could break in without the masters. You have related experience at least, have those econ & finance electives, and have shown interest (which matters.) If that's the case, I would recommend getting your Real Estate license. I didn't have mine coming in and it was a hassle. Wish I would have just done it in college.

    • 1
Apr 24, 2013

I'd be fine starting in what you do. I've also thought about going for an MSRE, but I'm nervous get a specialized degree like that without any experience.

Apr 23, 2013

what type of value add does your real estate background bring to a non profit board? what advice do they seek from you?

    • 1
Apr 24, 2013
djc225:

what type of value add does your real estate background bring to a non profit board? what advice do they seek from you?

It's more my "business sense" that helps.

Specifically, I'm on the board of a city neighborhood redevelopment company and a mental health advocacy organization. The redevelopment company is made up of hippies who think feelings pay the bills and the mental health advocacy org is made up incredibly smart people who have almost no experience in business and can't pay their bills because their funding got 45% slashed.

So...I bring some sense to the redevelopment company (not to mention that redevelopment inherently involves real estate) and I've been helping the advocacy organization restructure their lease and fundraise.

What do I get out of this? The redevelopment company is in a major "turnaround" neighborhood. It's poised for a terrific turn over the next 10-15 years and has already come a long way. Getting in with the locals (especially because I would not actually live there...yet at least) is terrific because they're going to be consulted anyhow on any new projects. As far as the advocacy group, like I said it's personal. I've had a lot of family issues with depression/anxiety. I get to "do good" while boosting my resume. It's a win-win, like dating a hot girl with a good personality.

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Best Response
Apr 24, 2013

I feel like I should chime in a bit here.

CRE brokerage is becoming (or already is) a commodity business. So fees are constantly being pushed lower. When we have brokers pitch to us to sell some of our assets they are proposing fees in the 25-45bps range and we will always pick the broker with the lowest fees provided we believe they have the right rolodex. I agree with the comment that seven figure commissions are gross outliers and are only received on large portfolio brokerage deals (and you typically have the investment banks starting to circle those opps spinning a corporate angle and trying to justify higher fees for a more "complex" transaction).

I would also say that if you want to work in REIB or large opportunistic REPE then you need to have good grades from a good school etc. Even in my own firm I have noticed the shift to hiring only BB REIB analysts for our associate program, whereas previously (4-5 years ago) the background was slightly less important. And if we do hire analysts they are from targets. I would also say that I have noticed the better REITs starting to pick off REIB analysts instead of ex-brokers and valuers.

The trend I am seeing is that REPEs, REITs and other RE Investing companies are starting to become much more institutional and sophisticated and the hiring is reflecting that. i.e. it's always safer to tell your investors you hired a bunch of ex-MS RE bankers who went to a target. CRE is no longer the wild west.

I'm not trying to be harsh here, but the reality is that it is was always extremely difficult to go from regional brokerage firm to Blackstone REPE, but now it is becoming very difficult to make the intermediate steps, like going from working as a junior for the top CBRE team in the country to a MM REPE firm without an outstanding story.

Happy to answer any questions.

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Apr 24, 2013
RE_Banker:

I feel like I should chime in a bit here.

By all means. It's great hearing from the other side of things of the table.

RE_Banker:

CRE brokerage is becoming (or already is) a commodity business. So fees are constantly being pushed lower.

RE_Banker:

I agree with the comment that seven figure commissions are gross outliers and are only received on large portfolio brokerage deals (and you typically have the investment banks starting to circle those opps spinning a corporate angle and trying to justify higher fees for a more "complex" transaction).

While RE_Banker is completely correct, these are also all advantages to a regional market. Here, there are far fewer players in the game so there is far less competition and no major banks circling the wagons. Fees are stable and brokers are cashing in. It's an exciting time to be where I am.

RE_Banker:

The trend I am seeing is that REPEs, REITs and other RE Investing companies are starting to become much more institutional and sophisticated and the hiring is reflecting that. i.e. it's always safer to tell your investors you hired a bunch of ex-MS RE bankers who went to a target. CRE is no longer the wild west.

RE_Banker:

I'm not trying to be harsh here, but the reality is that it is was always extremely difficult to go from regional brokerage firm to Blackstone REPE, but now it is becoming very difficult to make the intermediate steps, like going from working as a junior for the top CBRE team in the country to a MM REPE firm without an outstanding story.

Also very true, however it is still far easier to get into a top MSRE or a MSRED program and advacne through that than a top MBA program. I'm not sure about where you work, but a good friend of mine got an MSRE from Georgetown (out of the same UG I went to) and is constantly showered with major, notable offers in DC. He should be in REIB soon enough, coming from an investment sales background.

RE_Banker:

Happy to answer any questions.

As I said, you should really consider doing your own AMA. I think it would really help build the community here.

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Apr 25, 2013
CRE:

As I said, you should really consider doing your own AMA. I think it would really help build the community here.

I have done one of these a while back and I also did comment on doing a MSRE as I did one. I am too lazy to dig them up though.

Apr 24, 2013
RE_Banker:

So lemme get this straight, in your opinion CRE is going the way of the prestige, douche baggery bullshit that's engulfed IB, PE, etc.?

*takes out list, crosses off CRE*

Apr 24, 2013
FrankD'anconia:
RE_Banker:

So lemme get this straight, in your opinion CRE is going the way of the prestige, douche baggery bullshit that's engulfed IB, PE, etc.?

*takes out list, crosses off CRE*

It is just maturing as an industry. Someone earlier said that "the ivy league's best and brightest aren't going into real estate." This is changing because the opportunity is very, very real. In REIB & REPE, this shouldn't even be a surprise. They're still investment banks and private equity groups regardless of what the product is.

You have to remember that CRE, especially brokerage, is still relatively in its infancy. I'm talking the past 30 years in its current state, and over the last 5 or so many many firms have been bought out by others.

I'm not sure why this equates to "prestige, douche baggery bullshit." If you're interested, break in now, kick some ass, and make a name for yourself.

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Apr 24, 2013

I'll get to these (plus more pm's) when I'm in the office later, but good shit RE_Banker. Great to hear from the "other side"

You should think of doing an AMA

Apr 24, 2013

Here's another PM that I got that I'm just going to quote without giving anything away.

Private Message:

Hey, just read your post. Good shit man. You and I are very similar in background. Alright GPA, state school, Poli Sci and Econ, etc. I also graduated and was looking at consulting, still am kind of. I was looking for jobs that involved finance/econ, and that had transferable skills to apply to an MBA, or analyst in a consulting shop in a year or so. I've wound up in CRE and actually love it for the same reasons you stated- it's a different vibe, care less about pedigree (in most cases), and you can see and point to the buildings in a city.

Nice. Great to see so many people in the business. Who knows, maybe we could get some dealflow through WSO. Wouldn't that be the shit?

Private Message:

I was wondering, what do you think is the most important skill you gain from time in research? Understanding the market, terms, etc? Understanding the functions of the different players, like developers, brokers, banks? Or what technical skills do you find critical to know?

All of the above. Being a researcher sucks, but my understanding of the market, the players, etc has gone through the roof by doing what I'm doing. I was in a fraternity in college and I liken this to pledging. I'm paying my dues, doing thankless tasks, memorizing information, and cleaning up messes - it's a good metaphor.

As far as skills, honestly writing is #1. MANY people here can't write well. My ability (thank you Political Science major?) to write professionally has set me apart quickly and I now write almost all of the pitches and ghost write almost all personal letters for the principals. The EMD of the NYC office, who spent most of his career in BB banking, called a mutual pitch that I wrote & constructed "one of the best he's seen." I'm still riding that ego boost to this day.

You have to make yourself useful. Find a niche or a skill or a talent or something that seperates you and define yourself by it.

Private Message:

What approach did you take to reaching out to people while networking. I'm doing some now too, with a couple alum from my school who are in good positions in my city. But I'm hesitant to hit up linkedIn and PM an MD.

If at all possible, I'd recommend e-mail. I know a lot of BSD's who only have a LinkedIn because some social media person told them they should and they check it about once a month. They check email constantly though.

Just yesterday, interestingly enough, I set up a major meeting with my principals and a partner at a big time PE firm in NYC in regards to 2-3 big time corporate accounts...all through cold emailing. I'm talking accounts that are a major part of the American fabric that my regional office would almost literally kill for. Just shot him an email saying that my principals would be in NYC for the rest of the week if he would want to meet with them and he said "sure, how's friday morning?"

Why did this work? Because I snail mail applied for a job from this guy (and got denied, but got denied personally via email and got extended an offer for coffee next time I'm in the city - meaning I got his email.) So, I stayed in touch via email, snail mailed him a Christmas card, snail mailed him a "Welcome to [my city]" card when his firm invested in a company here, etc. Now my bosses think I'm a badass. Initiative means everything in this business.

Private Message:

I've applied to two investment analyst programs from [snip] and [snip] recently, and I've been 'linked in stalking' a couple MD's and managers, but don't want to pull the trigger too early. I was thinking of going to their offices tomorrow with my resume though, and asking the receptionist if she could see that the HR rep in charge of the positions get them. (I've done it before and it worked, although they went with another candidate, and my roomate got his IB job that way too.)

Ya, like I said, you have to do things that other people don't do and do things that the people in charge of hiring identify with. Snail mail, coffee meetings, etc. Find them on LinkedIn, sure, but I would definitely pick email, a letter, or in person as the way to approach them.

Private Message:

Seeing this post on the front page while on the metro today was fucking awesome btw.

hah, how do you think I feel?

    • 1
Apr 24, 2013

snip

Apr 24, 2013

Before everyone is all gun-ho, be weary of shady real estate firms .... there are plenty. For all you know you could be 25 and still be making a bullshit draw salary with no benefits.

Apr 24, 2013
karypto:

Before everyone is all gun-ho, be weary of shady real estate firms .... there are plenty. For all you know you could be 25 and still be making a bullshit draw salary with no benefits.

That applies to almost every aspect of life though...

Still, the only way to do it is with a good firm. Lipsey's rankings are a decent start

Apr 24, 2013

I said the Ivy League's best and brightest aren't going into commercial BROKERAGE because the fees aren't as high as some might think and because most people can't make it in the business (it's fundamentally a sales job). As far as RE IB, VC, REITs, etc., that's an entirely different story. Even so, real estate is the worst paid sector of high finance. The best part about real estate is that a smart guy can learn this business on a salary and then go into it in a more entrepreneurial role--few people can really do that in M&A or equity research.

I learned the real estate and loan business at elite firms and groups with relatively high salaries and then I went out on my own. If I had stayed at these firms, my income would have been capped around $200,000 at the very top of the industry. Real estate isn't rocket science which is why the salaried jobs tend to suck for comp. So I completely support you getting into the brokerage side. If you can hack it, it's a dream job.

Apr 24, 2013
DCDepository:

and then I went out on my own.

That's so key to anything. What do you do now, man?

Apr 24, 2013
CRE:
DCDepository:

and then I went out on my own.

That's so key to anything. What do you do now, man?

Top state university to crappy job to several elite firms and roles. I asked a lot of questions, studied my jobs and firms in depth, and worked into the early hours of the morning during Thanksgiving, Christmas and New Years to crush my roles during my early and mid-20s. Became an expert at what I was doing. Worked my contacts and just before my 27th birthday last year, a 400-person Midwest financial institution purchased a national bank and hired me to start their Mid-Atlantic branches. Recently they let me buy shares in the privately traded "stock". Hoping that my business partner and I can get a slot on the board of directors in the next 3 or 4 years as the revenue production of our branches has been taking off. Working 8 am to 1 am most days. Working right now, but WSO has been a place I've read since at least 2006 (back when it was ibankingoasis.com) and I like to browse and post in down time. Just recently opened an account in the fall, but have been a loyal reader for 7 years at least.

Anyway, it comes back down to the best money comes when you learn your business really well and can become entrepreneurial. And what's great about real estate is that there are so many different ways to specialize and make ridiculous money, from flipping houses all the way to opening lending institutions. It's a flexible and amazing industry (although we are trying to build our municipal and university lending business more right now than we are trying to expand large commercial real estate holdings since balancing risk is one of the most challenging aspects of the regulatory process).

Apr 25, 2013
DCDepository:

Even so, real estate is the worst paid sector of high finance.

I would disagree with this.

I'm pretty sure the guys at GS SSG who do a lot of real estate backed trades (shorting the RMBS market / CMBS market for instance) make a killing. Google the $70m man McGoldrick who wasn't happy with his bonus and started his own hedge fund.

If you dig into who really cashed out in the BX IPO, it was the 2 co-heads of real estatewho had paper net worth of $1 billion when the stock was at its peak (I think there is a Bloomberg article on Jon Gray that states this).

There are 2 pretty specific examples, but they also show that when you do well in real estate, it can be huge.

Apr 26, 2013

Feeling as though networking will really be the way to land a job soon. Doing my MBA right now and it seems really useless. Getting good grades but don't feel as though I'd be useful to any company.

So my question: If someone came up to you and started "networking", what would your reaction be?
-This guy wants something from me, hope he goes away
-This guy would be useless to network with etc
What would make you take interest in that person?

It seems to me that people want to talk with other people. You can see them open up when the first question is asked. I'm trying to be the person to take the first step, but sometimes it seems forced. I find as though i need to find a real connection in order to connect. It could be golf, could be food... anything. Networking events seem so hard because no real relationship is built. Any thoughts?

Apr 26, 2013
Andre.p:

Feeling as though networking will really be the way to land a job soon. Doing my MBA right now and it seems really useless. Getting good grades but don't feel as though I'd be useful to any company.

So my question: If someone came up to you and started "networking", what would your reaction be?
-This guy wants something from me, hope he goes away
-This guy would be useless to network with etc
What would make you take interest in that person?

It seems to me that people want to talk with other people. You can see them open up when the first question is asked. I'm trying to be the person to take the first step, but sometimes it seems forced. I find as though i need to find a real connection in order to connect. It could be golf, could be food... anything. Networking events seem so hard because no real relationship is built. Any thoughts?

I like lists. I'm going to make one instead of writing paragraphs.

1. Networking is the only way to land certain jobs already.

2. While your MBA classes might seem useless to you (not sure - I haven't done it yet) you are building an alumni base. This makes it so much easier to network in the future (or now). Common interests are key, and a common school is one of the most commonly found common interests.

Common

3. I already get kids I know younger than me in college who are now hitting me up for the first time in months (if not years) wanting to get lunch or some shit. I don't mind though - I respect the hustle. If I think they're good candidates for whatever I'll help them out. If I don't, I don't. I got my job (and quite possibly a badass new account) because someone took a chance on me and believed in me. That's something you have to pass on.

4. People love talking about themselves, especially successful people and especially successful East Coast people. Ask questions, let them ramble, listen to their answers (this part is key. no kidding - people forget it), and relate their experiences back to yours somehow. It's almost move for move like talking to girls - there's just a different endgame.

5. It will always be forced at first. The thing is, the other person doesn't care, and if they do you're not going to get through to them anyhow. Everyone knows what is going on. Here's a different girl metaphor. You know, going to a strip club, that you're going to pay the strippers money. They know it too. They know that they're going to fake liking you. You know it too. Everyone knows what is going on and with that mutual understanding, things can move forward. That's when it becomes more natural.

6. You don't find that connection right away. Girl metaphors again...ok you don't find that a girl has a great personality first, right? You see her across the room and you think "Damn, she has a fine ______." After talking to her for a while, you could possibly come to the realization that "wow, this girl is actually pretty cool too," but you didn't know that she had a sweet personality and you guys had a lot in common first. You have to break down that barrier, and the only way to do that is just go for it. Make there be a reason to talk. Create it out of think air. I've gotten potential clients by mailing them my resume. Every now and then a principal will reply to tell you that there are no positions open instead of HR...but oops...now you have his email address even though it wasn't listed on the website. Now he's yours.

7. Networking events suck. You have to get people one on one. Again, girls, you gotta pull her away from her friends. There will always be the fat friend who kills your game or the maternal friend who pulls your target girl away even though she's into you or the whorish friend who throws herself at you when you don't really want her. You also have your friends who ruin things, including the guy who thinks he's the smoothest and is just embarassing, the overly drunk asshole, the loser who friend zones himself on purpose but kills your game in the process, etc.

For jobs, you gotta cut out the bullshit as well. You don't want there to be tons of professionals to talk to nor do you want there to be tons of people just like you throwing their resumes and self-made business cards in the professional's face. That's garbage. You want to stand out from the pack - not be one of them. Mail snail mail letters, send cards, cold call, cold email.

Well you got paragraphs too. Lucky you!

Apr 26, 2013

This is awesome, I've always wanted to find out more about working at Jones Lang LaSalle, CBRE etc.

Apr 27, 2013
rm1234:

This is awesome, I've always wanted to find out more about working at Jones Lang LaSalle, CBRE etc.

Feel free to ask as many questions as you come up with

Apr 26, 2013

Where does one source off market commercial properties to list? How to you come in or just contact commercial owners? Especially multi-family owners were they are just anon numbered LTD's of rental pools.

I honestly don't think that going on a couple of boards is worth the networking or so called prestige of low level- read depressing is worth 10-12 hours (120+ hours a yr). I did it for a short period- it was terrible. 99.9% of the time big wheels are only on the great boards- those positions are never available and are donor based- just look at the bio's none progressed up the ladder.

Apr 27, 2013
gofyourself:

Where does one source off market commercial properties to list? How to you come in or just contact commercial owners? Especially multi-family owners were they are just anon numbered LTD's of rental pools.

I use mainly CoStar/Loopnet, our proprietary database, and just basic observation skills. See a property/building, start knocking on doors or calling around to find out who the owner is, introduce yourself. A lot of times there are these guys out there who inherited property and have been trying to sell it on craig's list or something for the last 5 years. They can genuinely be helped by a big time brokerage coming in and getting them cash in 6 months.

When you're in the business you just "know" too. It might be hard to google who owns a building, but you know someone who knows someone who knows who owns that building and can set you up with the person.

gofyourself:

I honestly don't think that going on a couple of boards is worth the networking or so called prestige of low level- read depressing is worth 10-12 hours (120+ hours a yr). I did it for a short period- it was terrible. 99.9% of the time big wheels are only on the great boards- those positions are never available and are donor based- just look at the bio's none progressed up the ladder.

Oh I'm not doing it for the prestige. As I said before, I wanted to help people and boost my resume at the same time. I'm in my low to mid 20's - being on the board of directors of things looks damn good for me both from a "he's involved in the community" perspective and a "I want to get into a good MBA program one day" perspective. Also, the 10-12 hours thing is nonsense. I spend like 2 hours on each a month, if that.

Being on boards is seriously the perfect thing to do, in my opinion. I am simultaneously being selfish and selfless. It's the best win-win I've come across lately.

Oct 10, 2013

Thanks for the AMA, lots of great advice on here. I understand, In your case, you plan on becoming full-time broker after your researching stint is over. However, to those RAs who are hesitant on becoming full time Brokers, what exit opportunities have you seen other RAs transition into? I've recently obtained a position as a Research Analyst at a Real Estate research firm that focuses on Multi-Housing developments in various Markets throughout the USA. Of the interviews I've had, this position, unfortunately, wasn't really my first choice but I had to take it because of the fact I needed a job. Although I'm enjoying learning about different markets, I'm extremely apprehensive about becoming a broker. The idea of earning a commission based salary just doesn't sit well with me. Because of that, I'd be interested in knowing what other RAs have lateraled into once their time as researchers ended. Also, care to recommend any books to increase knowledge of CRE/RE/Urban Economics in general? My ultimate goal would be either to get in a Real Estate Advisory role or REPE, so recommendations tailoring to those would be greatly appreciated. Cheers.

Oct 25, 2013

I know of people who have gone on to analyst roles in acquisitions, leasing, sales, asset management, valuation.. firms like JLL, CBRE, PNC, Integra... I think research gives you a very broad knowledge and good foundation. You're background (education), steps you take to improve your resume, and networking allow you to move forward. Research also gives you an idea of what different roles and companies do.. for example, a good friend of mine is giong into brokerage with one of the top national firms, and a girl I know recently moved into AM. Its not a bad place to start but you need to really work hard, learn as much as possible, and network into the area you want to be in, or take the necessary steps.. you wont go directly into PE from research

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Oct 26, 2013

Thanks man, appreciate the response. I understood it would be difficult to go straight into REPE straight from an RA role. It was just confusing to figure out what the best path was to lateral. This gives me a clearer understanding of what needs to be done in order to transition.

    • 1
Feb 10, 2014

Sorry to revive a thread that's been inactive for a few months, but I would love some input. I'm currently a Home Equity Underwriter and have been trying to figure out what I want to do with myself. I've been very interested in Commercial Credit analysis for quite some time now but after reading through your thread, your job sounds like it's a bit more interesting along with the fact that it leads to more opportunities. Do you have any advice for someone in my position who's looking to get out of Consumer Banking? I'm all over the place and I know there's so much out there that I'm not even aware of.

Aug 1, 2016

I'm a current student intern in Insurance & Risk Management but ideally I would love to get into Commercial Real Estate. I'm a finance major and trying to look into jobs on the financial side of CRE but not sure how to get into the CRE market. I do like the idea of getting out of the office at times and interacting with people but not sales. I've considered real estate analyst, commercial loan officer, and commercial underwriter but how do you work up to these jobs?

I would love some insight to the real estate job market. Thank you.

Aug 1, 2016

The main thing with commercial real estate will always be getting a foot in the door. Once you're in, you can move around far easier because you are now a "real estate guy/girl." Look into the Urban Land Institute and other industry groups. Networking is key

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