Honestly not sure where to even start but curious about this topic but can’t find any great resources online.
Any info or resources would be appreciated
| +115 | Is anybody just going to leave the industry? | 40 | 1h |
| +41 | CRE Recruiting for a Career - crazy? | 10 | 12h |
| +34 | Exits from REPE | 17 | 24m |
| +26 | Multifamily firms collpasing in Dallas whose next? | 8 | 3d |
| +26 | Arbor Realty Trust in 2026 | 13 | 6h |
| +25 | Red Flag? Commissions-only acquisitions roles | 8 | 9h |
| +21 | Q3/Q4 CRE Job Market Optimism (or lack thereof) | 10 | 11h |
| +18 | LOI Underwriting / Due Diligence | 1 | 1d |
| +15 | NYC Real Estate Job Market | 6 | 9h |
| +13 | Family Office vs REPE | 9 | 10h |
Career Resources
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
PIKs (Payment-in-Kind) and AB notes are distinct financial instruments, and understanding them is crucial for roles in private equity, investment banking, or structured finance.
PIKs (Payment-in-Kind): - PIK interest refers to interest payments made not in cash but in additional debt or equity. Essentially, instead of paying interest in cash, the borrower issues more debt or equity to the lender. - Key Features: - Often used in leveraged buyouts or distressed financing. - Allows the borrower to conserve cash during the loan term. - Accrues over time, increasing the principal amount owed. - Impact on IRR (Internal Rate of Return): - PIK interest can significantly affect IRR calculations. Since PIK increases the principal, it can amplify returns if the investment performs well. However, it also increases risk because the borrower owes more over time. - For example, in private equity, understanding how PIK affects IRR is a common interview question. You might be asked to calculate how compounding PIK interest impacts the total return on an investment.
AB Notes: - AB notes are a type of structured finance instrument, often used in securitizations. - Structure: - "A" notes are senior and have priority in repayment. They are considered lower risk and typically have lower interest rates. - "B" notes are subordinate and only get repaid after the "A" notes. They carry higher risk but offer higher returns. - Use Case: - Common in real estate or asset-backed securities, where cash flows from the underlying assets are divided into tranches (A and B notes) to cater to different risk appetites of investors.
For more detailed insights, you can explore the following resources: 1. PIK Interest Questions in Private Equity: https://www.wallstreetoasis.com/forum/private-equity/pik-interview-ques…</a">PIK Interview Questions 2. Debt and Leveraged Finance Overview: https://www.wallstreetprep.com/knowledge/ultimate-guide-to-debt-leverag…</a">Wall Street Prep Guide to Debt
These resources provide a solid foundation for understanding these concepts and their applications in finance.
Sources: Working in FIG (Financial Institutions Group) - An Overview., https://www.wallstreetoasis.com/forum/private-equity/pik-interview-questions?customgpt=1, WSO Hall of Fame: Private Equity Forum, Anatomy of the 10-K, A Banking Primer
There are great resources online. PIK is basically your typically mezz structure, with part of the payment paid currently and part of it paid accruing(non from cash flow) also called PIK'ing. A/B is where a senior mortgage is tranched out e.g. instead of 65% LTV, there is a 40-50% portion and a 50-65% portion, the blended rate is your all in rate.
Hey man appreciate the response. Helpful! Are the resources YouTube? I’ve been struggling to find good YouTube videos so any specific resources or websites you’ve seen would be helpful! Thanks!
for A/B notes, just google...and you have to read some pdf's on the subject matter.
Same for Mezz, it's easy. out of an e.g. spread/coupon of 8% for mezz, it's like half current pay(just like you pay a mortage), and the rest is "phantom interest" which does not get paid but you add it up every month the principal does not get repaid.
Numquam voluptatibus ex autem ad qui. Hic modi et iure sit impedit omnis ea.
Rerum consequatur perferendis rerum architecto dolores cum recusandae sunt. Sunt consectetur autem sed hic qui modi dolor. Cupiditate eligendi quas deleniti impedit.
Iure sit excepturi et minus et voluptatem consequuntur. Saepe porro at et incidunt. Sit quod sed animi enim facilis iste rerum est. Magni facere dolores iure sint suscipit culpa voluptate. Aut vero adipisci accusamus velit sit aut dicta odio.
Autem dolorem tempore assumenda nulla ut fuga. Excepturi aut voluptatum laudantium qui. Modi rerum ipsum exercitationem et. Tempora explicabo qui expedita totam dolore amet non. Voluptatem dolores perspiciatis tenetur alias.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...