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May 31, 2024
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All depends on your alternatives. People have been saying we're in the latter stages of the current cycle for like three years now.
But interest rates are finally rising, so don't you think this may actually be different this go around?
I'm contemplating leaving balance sheet lending (big bank: think PNC, JPM, BoA, WF), but trying to be mindful of not going into a role within a firm that soon may bust.
Be mindful of where you go - but no need to avoid acquisitions altogether. Companies that have been piling on leverage and relying on speculative rent growth/leasing assumptions might be a risky move, but that doesn't describe everyone. Lot of shops have a lot of dry powder and are waiting for a pullback to deploy- definitely wouldn't expect mass layoffs across the board.
Haven't worked on debt side, but I have heard that space is getting more competitive. If you are convinced on an impending downturn, wouldn't rule out AM side if the funds start taking buildings back.
AM hiring is up across the board for this reason. A lot of firms are pulling back on acquisitions and focusing on preserving capital and asset managing their existing portfolio. That said, there are also still plenty of active groups out there with lots of money to put out and groups that are conservative and diligent with their acquisitions even the current environment. As others have alluded to, it all depends on the group, but I would definitely be cautious about which one you are joining since acquisitions folks seem to usually be the first to go when the music stops.
I literally just accepted an offer for a Senior Acquisitions Analyst role at a $2B Infra/Industrial fund that operates at about 50% leverage, core-plus fund and know very, very little about real estate. Am I fucked, lol?
You know very, very little about real estate? You're not fucked, but they are.
Higher rates can also be very bullish real estate. It’s a sign that the economy is strong.
When there's a dip the returns also become more attractive, so as some alluded to above if a firm/fund is well positioned they may actually look to increase acquisitions headcount, especially if the firm's profile is an all-cash transaction basis. I for one would welcome a tempered downturn since I could actually get some decent returns for a change.
If companies are leaning toward hiring more AM personnel, does that mean they get paid more of a bonus at year end since their expertise would be more valued at this point in the cycle?
Quo est ex quod perferendis ut illum. Quo qui iure et atque.
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