Brokerage to Principal

Wanting to make a move to the principal side of things but looking for advice prior.

About me: I work for an investment sales team at one of the big 4 in a primary market covering office, retail, and industrial. Been here for a little over a year and have a great grasp of Argus, Excel, and basically the conceptual understanding of how various factors (debt, leasing, markets) affect value. Feel like I'm either going to stick with this and become a senior analyst or make my move.

  1. Is it too early for me to leave to the principal side? Should i stick it out as a senior analyst first?

  2. Is my resume sufficient to even break into a larger firm?

  3. Location is a big factor for me but - should I look for firms with higher aums everywhere and grind at the best potential offer for a couple of years?
    Or should I find a smaller firm in a city I like and ride with them?

Thanks. All advice appreciated.

Comments (8)

2mo
rogain828, what's your opinion? Comment below:

Interested to hear what others have to say as well. Would you mind sharing your current comp and what you'd expect to make if you stuck in out to a senior analyst? Seems like the senior analyst path isn't talked about much on here (with going principal side or becoming an associate broker as the usual choices).

  • Analyst 1 in RE - Comm
2mo

Don't know the answer for you. What are your longer term goals?

i am in brokerage. Part of me thinks spending some time on the principal side would be beneficial to rounding out skills and perspective to eventually go solo. But don't think I could make the same money on the principal side (or anywhere close to the same frankly). Obviously that calculus could change dramatically if the sale volume drops off from the past few years.

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2mo
crerepe21, what's your opinion? Comment below:

I went from brokerage at a big 4 on the IS team in retail to principal side in development after 1 year so I was in a similar position as you back when I made the jump. So here's my 2 cents:

1. It is definitely not too early to jump ship. People know that a lot of the time undergrads go into IS to make the jump to REPE or dev. You'll probably get a question like "why do you want to make the move?" or something similar so if you say that you were unsure about CRE at first and wanted exposure and now passionate about investing in RE and make the move... blah blah blah. Being a senior analyst won't drastically change your chances to land an Acq or AM role on the principal side, so you can always start looking now and be picky about when you make that jump if you're expecting a promotion soon. 

2. Resume is much more than just your most recent job. If this was your first experience in CRE, then probably not lean on just this one year at a top brokerage. If you had internships at REPE or developers in college (assuming you're fresh out of UG) then that would significantly help. Similarly, if you have experience in lending/appraisal/surveying/ some other aspect of RE before brokerage then that would also greatly help. If you only want to go to Blackstone/Starwood/KKR/Brookfield then I'm afraid just one year at a brokerage will probably not be enough unless you have connections and a great academic track record. However, if you want a job at a MM principal with like $1-10B (yes its a large spread but you get the point...just not the massive players) then you have a much better shot. 

3. AUM only matters to a point. A firm that can fundraise for projects might only have a portfolio of $500MM but rapidly growing and could be a great idea to get in on the ground floor now and grow with them. Also, if you go to a firm with $10B AUM then they are much more established and can bring you along slowly and not just throw you in the deep end which sets you up for long term success. If you want to live in a HCOL city then it might be more important to focus on salary to cover costs, but if you're in a Midwest or more secondary/tertiary market then go with whatever your more comfortable with. Working at a smaller firm trying to help them grow is like working at a tech start-up...definitely more risky but you have more potential earning power than being another cog in the machine at a Blackstone (but you wouldn't suffer with a Blackstone salary). 

2mo
jenever1, what's your opinion? Comment below:
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2mo
itsanumbersgame, what's your opinion? Comment below:

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