Breaking into RE as a consultant?
Looking for advice on how to break into real estate (ideally in acquisitions/investments on the opportunistic side) as a consultant. I’m at a reputable firm (MBB) in the private equity group and have received strong performance reviews over the last two years at the firm.
I’ve been approached by a lot of headhunters about reputable PE firms, but I haven’t had much luck on the real estate side. I wanted to get some opinions on the following:
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Are there any consultant-friendly real estate shops? Has anyone here made the jump from consulting to real estate?
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How should I go about searching for a role? Are there certain headhunters or resources I should look into?
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As someone with two years of consulting experience (recently promoted to the associate level in banking equivalent), how senior of a position should I target? Is it realistic to target associate or senior analyst? I don’t mind taking a paycut, but I’m apprehensive about sacrificing more than 50% of my current pay (~$210k)
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Given my position, would it make more sense to take an indirect path into real estate (e.g. start as PE associate or in real estate IB)? If so, what path would you recommend?
Thanks in advance for your help!
Bump
I essentially made this transition in the opposite direction, but as someone who's had some experience on both sides, I'll offer my input.
1. I wouldn't say there are "consultant-friendly real estate shops", but this is more because the transition you are trying to make is quite rare. I think most firms would be open to interviewing you given your background.
2. I don't have much insight/experience with headhunters, but I think you'll get the most traction applying direct to openings and working your network to get some introductions.
3. I think Associate/Senior Analyst is reasonable. You shouldn't have to take a 50% cut unless you're truly coming in at an entry level role. See my second to last paragraph for more thoughts on this.
4. This could make sense if some of the firms you've been contacted by have real estate arms and you can guarantee some exposure to that work, but I think working in traditional PE would be an unnecessary step if the goal is just to work in real estate.
Here's my $0.02: real estate investing is a relatively simple industry, but with a lot of nuances that can't really be learned without repetition. At the senior analyst/associate level, MOST of your value is going to come from process/polish/professionalism and analytical horsepower. You should be pretty "saleable" in those areas, and you'll have to be upfront about needing to get the reps and learn the nitty gritty stuff. I think if you polish you story, network a bit, and shoot some applications out, you shouldn't have trouble landing a few interviews. Then it's up to you to be ready to pass a modeling test and be as "technically" sound as you can.
A word of caution though: I would be very certain that RE is the career you want before making the jump. It is inherently quite different from consulting. Acquisitions if NOT an 80/20 career; you will at some point find yourself oscillating through sensitivity tables at 1:00am that change the returns by single-digit bps and you KNOW the analysis wont change the go/no-go decision on the deal, but the investment committee will want to see it. I can see how stuff like that could be very frustrating for a consultant used to spending time on directionally meaningful analysis and ignoring the rest. Secondly, the lack of variety can be tough for certain personalities. If you enjoyed the generalist aspects of MBB or the promise of a totally different engagement at the end of your current case, say goodbye to that, because while deals obviously differ it's a drastically smaller level of variety than consulting.
If it's really what you want to do, good luck! I think you
Thank you - appreciate the detailed response! Would you say that opportunistic real estate is more 80/20, or are these observations true even on that side?
I've worked across what would probably be considered core-plus to value-add, and that is where those observations come from. IMO, "opportunistic" vs value add pretty much means development/significant repositioning or some level of distress involved. I would surmise that the stringency of underwriting is equally rigorous as long as you are investing someone else's money,
First, Beers gave a pretty solid answer, so I ditto that. Including the "cautionary" tale on whether you should jump this way or not. For context/background, I did real estate/economic consulting before joining a development firm (as head of research/strategy), so I have some understanding, but I was not in the MBB world and was very much in "real estate", so take my thoughts for what they are worth. Here my answers to your questions:
1. I'd think many "big name" institutional shops will respect the MBB background, not sure they will care all that much, but bigger the name, the better the luck (FWIW, I talked to a person on WSO over a year ago who made a jump from a MBB shop to a big name institutional investment mngr, so it is def doable). Like Beers said, not common, but it happens, people from a lot less have successfully made it in to real estate, so I'd think you should be able to if so motivated.
2. Network Network Network... making these jumps works best via personal connection (even if just to "bump" your application internally). Apply on line of course (then network with people at those firms). NO harm in sending resume to HH firms, you can find lists on posts on WSO and elsewhere, just know they will prob not respond to you. If your resume fits what they are looking for, they will reach out, if not, they will just tag into the system. Keeping LinkedIN up to date (maybe get some real estate memberships or courses on there?) could help equally. TBH, not sure if they ever seek "MBB" types (more common is IB or CRE brokerage), so may just get looked over, but again, worth trying.
3. With just two years of exp, I'd be prepared to make this a "restart" and enter at the analyst level. That said, some may give you associate or sr. analyst ranks (title/ranks are more BS in this industry tbh). I'd def apply for associate roles as well as analyst roles. Everyone will view this differently, but getting a matching title with a jump like this is possible, but you should be ready/okay with a lesser one given that you are seeking first real role in real estate and not coming with direct exp. As to pay.... if your current ALL IN is $210k, then getting that or close to it with ALL IN pay in a buy-side shop is not impossible, BUT you may get offered less like all-in $150k or even less at a firm you really want to work for (note, there can be serious WLB trade-offs in the firms that offer you close to $200k all-in). So, I'd be prepared to take less if you really really want to do this jump.
4. Really... I'd just go direct, I don't see doing other paths as smart unless you really really want to (I mean how bad do you want out of MBB world??). You could spend another year or two at current firm, do MBA and jump that way. Longer, more expensive sure... but maybe the path that opens up the "top" shops if you so care. Clearly, you could recruit now, and if you don't get what you want, fall back to this option.
Good luck!
Thank you, appreciate it!
Do you think firms would consider an mba hire if they have no prior experience? Going back to school was part of my plan anyways, but I’m not sure if most firms would demand previous experience. I know in PE that is often the case.
I think your consulting experience would have to count for something, but it's worth investigating that further. To note, RE firms seems to be more open to "new" people post-MBA than PE in general (my opinion at least), but I'd research more for better idea. TBH, how you frame your current work matters a lot in this regard. People jump from banking, law, general corp stuff into CRE, so I dont see why this is any harder.
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