I have a couple offers on the table right now for development roles. My end goal is to run my own development business for residential and I need to add experience to fill my deal sheet and get to that point. Mainly finance background with a few years of development on varying scales. I have two very different offers types and I’m not sure what best gets me to my goal:
1) family office developer- focus is on entitlements and land development for multifamily, master plans, and single family. Offering 1099 with no non compete so I can start consulting and eventually work into my own development company. Downside is there is no vertical experience here as they sell after entitled. Not a name brand recognized nationally but known locally. Upside is deal participation (loose on structure) and mentorship as I would work for very close with the main guy and run deals immediately.
2) big name multifamily developer (top 10)- more structure than one and more of a ladder to climb but get a stamp on my resume that might be helpful in the future. Opportunity to advance fairly quickly based on merit from what I’ve been told and confirmed.
Where am I learning more? What would you do assuming similar comp?
I chose a path smilier to number 1 and if it’s any help I’m glad I did over a larger corporate developer. The learning component is so much easier with the mentor type relationship you can get at a small shop boss imo. Not saying you can’t find it at a big firm, but I doubt you’ll have the same opportunity to really sink your teeth into all the parts. Plus if you really apply yourself you can grow pretty damn quickly relatively speaking.
I’m slightly bias because I detest corporate environments broadly. Feel free to PM if you want to discuss in more detail. I’d advise against settling on anything but exactly what you want to do.
Land entitlement is probably one of the best and least capital intensive way for a small time single guy to go out and make big dollars. Honestly you could probably get to your end goal more quickly doing the small developer.
And take this comment with a grain of salt as I don’t solely develop for a living, but the real difficult part is the entitlement and horizontal, once you start going vertical on typical garden style multi it’s a dime a dozen, go get a cookie cutter design from an architect on the cheap and there’s probably 15 people in your market who could actually build the thing.
Your thought process is spot on, it is a tough decision. I have worked for both a small developer and later for a very large developer. The large, corporate development shop definitely provides brand name recognition and exposure to large, exciting projects. I think this will be most helpful for future capital raising, lateral to a top role at a smaller firm, or a path toward a leadership position at the large company. However, when working for a smaller shop I was able to wear many more hats. I was involved in development, construction, AM, PM, marketing, capital raising, deal structuring, etc. This helped me establish a more well rounded view of real estate and understanding of how to run a small RE investment business.
Well, you seem to have a good idea of where you want to end up, so maybe consider the pros and cons in light of that goal.
Working for a big name developer is great, but if/when you do end up on your own, how is that brand going to help you? You don't care about the stamp on your resume, because the goal is not to have to shop your CV to other firms who might be impressed by it. Working on huge and cool projects is interesting, but you won't be doing huge and cool projects. It'll be great to advance quickly, but you don't want to be there long term, so the seniority ends up being somewhat meaningless.
If you end up hanging your own shingle, having built a million square foot development project, or managed a team of 6 people, isn't going to be of value. It's going to be you, sitting by yourself, managing the myriad complexities of a deal. Just being at a big shop which will handle things like requisitions, or help with change orders, or random things like that, may actually hurt you, because those are the day to day tasks that move deals along. As sexy as it is to sit in a room with some important person from Wells Fargo and negotiate a major construction loan, or pitch a pension fund to invest in a megaproject, that stuff won't help you get where you want to go. Being at a small shop and being the guy who gets the deal done from the entitlement process to the lease up... that is what you'll be doing, if you do it on your own.
Was at a smaller developer, where are you in your career? If you're newer I'd lean towards #2 and get the name on your resume so you can jump easier. You can end up doing a lot of the same things a #1 vs #2 over a few years but brand name will help you stand out. I was at a smaller developer and downsides are they can be sketchy af with their practices and not care about your growth. Upsides are you're learning many different areas and are more of generalist seeing more of the process.
This is pretty fucking awful advice. You may have been at a single small developer which didn't care about your growth, but that's obviously not going to be true across the board. You can make a strong argument that such a lack of mentoring is more likely at a big developer, where you're an easily replaceable cog in the machine, than at a small shop.
Lets be generous and assume you're experience from a mentorship and "interest in my career growth" standpoint is equally likely to be good or bad at any shop, depending on your direct manager. So it's the rest that matters.
Appreciate all the comments and advice here. I need to decide this week. To clarify a few things:
I have been more on the finance side and not in a direct development position. Previous company was well known land developer but small team so I had some carry over of development responsibilities but leaned more towards AM. Developed way smaller deals the past couple of years on my own. So I have great finance experience but would be coming in at a development associate level.
I also don’t like corporate cog in the wheel environments like many others. The big group does not seem to have that culture but it’s still a top tier dev shop so will ultimately have more of that than the other option. Analysts on the team also. Cradle to the grave shop so still not overly focused.
When I say small, I mean small. The mentorship is a guy who is pretty well connected and has been doing it for 40 years. Basically had done this on his own and has a couple project managers. Their background/education of the group is not at the caliper of the big developer. Most of my connections in the area have heard of this company but don’t really know anything about them.
I can probably source some deals for the mentor where I probably couldn’t for the big group. Just more risk on the mentor route with more potential pay off sooner.
Maybe some red flags on the mentorship and I can imagine they don’t have any processes in place since he seems pretty old school so I will have to establish a lot of that. Cannot imagine he’s very organized. Big shop seems on top of it, young and aggressive.
Add on thought/comment from the above....
Do you feel you may be 'underqualified' for the role the smaller/mentor person is offering? Like you are getting it because you are younger/less experienced and they cannot afford or attract more senior/experienced people? TBH, that could actually be a positive setup from a learning and exposure point of view, but could also be a major red flag on ability to execute and operate. Again, too personal for me to guess/know, just a thought.
Given that a recession is highly probable.... smaller firms ability to operate/do deals (and pay salaries) can be very very tough. Of course 'big names' may layoff.... so not so easy to figure that risk, but worth considering given market cycle concerns.
I’m 4 years post-MBA. I recognize I have a good deal to learn on the construction/engineering side of this role but my background in finance fills a gap on his team (2 other guys). Small group said they pivoted after interviewing me from trying to attract someone with more experience though.
The 1099 pay structure of the family office developer seems like a potential red flag for me. This may no biggie at all, but when you say "similar comp" are you factoring the tax difference in pay structure? If you are really partner level and getting partner level comp, with participation and all that, then this is not so crazy. If you are still more "junior" in nature I find it more odd (again, could be fine/legit, just sets off some warning bells for me personally).
Overall..... I'd probably go with the "big name" shop personally (frankly, at younger age would have probably other decision tbh, so this is my view now 'older'). Unless you really are 'partner level/track' which can be near impossible really at a true 'family office' (this is different than family owned...), then you are probably going to need/want to jump shops anyway for career advancement (from context I'm assuming you are less than 5 yrs total career time/exp), and the "big name" will be better suited for this. Like, I guess the "family office" is where you may want to land after building better exp/track record.
I should say, I'm not really factoring/analyzing the "mentorship" thing.... mainly because it's way to personal for me to guess at. The "big name" firm may do this better than you think, and the family office person could actually be worse to work for.... OR it could be total opposite where 'big name' silos/ignores you and "smaller" legit lets you run the place with a watchful eye and guidance (and is otherwise all around awesome to you).... without knowing both people/firms, wouldn't pretend to know how that could go.
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