With there being so many property types at what point do you go ahead and just choose one and specialize? Or is there always a chance to switch? 28, late starter in RE and have currently been in office for a year and am about to make the jump to a new job but don’t want to make the wrong move. I don’t have much experience so I couldn’t say what I like the most.
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I think people overestimate how much it matters. There are quite a few generalist shops with small teams that work across asset classes, and lots of senior guys who have worked in one asset class most of their life that decided their firm was going to pivot entirely because of market conditions.
That's not to say it isn't a good thing to have specialized experience and knowledge though.
just depends what opportunities are realistic for you but yes i would say usually, picking something specific will help you move up. even if it's something trashy like dollar stores or trailer parks.
i'm sure the switching later on is not the easiest thing on earth but i was just reading 3 min ago about a resi development shop managed by a couple guys who came from completely unrelated real estate finance backgrounds, both of them coming from random-ass real estate product types.
So, there are absolutely reasons to "specialize" in a career, especially at the junior to mid level. Property type is one area/type of specialization, but not only one. Transaction type, financing type, deal structure, or functional role have the potential to become an area of "specialization" but might be prop type agnostic. So, don't narrow down to "property type" as only way to view this.
That said, I think a lot people just fall into the property type they are in largely because of a job they got in it (often out of college). I have a friend who is a mega-successful industrial broker, if you ask why he is an industrial broker he will say.... "when I got hired out of college, I was assigned to an industrial team". If you have a passion/interest in a particular type, then I would recommend going that direction, but it really is okay to remain "agnostic" with respect to property type at this stage of your career.
BTW, people and even firms shift focus on things like this more frequently than you realize. The corny saying of needing to be a "lifetime learner" or "change is the only constant" applies here. Go look at the mall developers of the 80s.... they are all apartment and even industrial developers (and other stuff now). I mean NAIOP used to be the "National Assoc. of Industrial and Office Parks", then Parks became Properties when urban building outpaced suburban, then they go all the way to just making NAIOP a word and calling it "NAIOP Commercial Development Assoc.".... in order to be open to retail/apartment developers. so, if F'ing NAIOP can change their focus, I'm sure we all can if needed!
I'm in industrial because I'm too lazy to model more than 2 tenants.
Large portfolios aren't that much easier though.
Early on it shouldn't matter. If you'd like to end up doing your own thing, or grow into a senior role, it will become extremely important. I would argue that long term, you should either know a geography or an asset class very well. If all you do is pick over the same national broker blasts that 500 other firms get, you're never going to generate returns. Understanding a specific market will give you a leg up on competitors and an ability to make better risk-adjusted bets.
If you only have a year of experience (regardless of age) you could make the argument that exposure to a bunch of asset classes is beneficial.
I've only done various commercial projects (hospitals, museums, office, industrial, retail, etc.) and I can't get any love from multifamily shops whatsoever when job hunting. Not sure why they are so picky, would be interested to hear from anyone on that side who could give their perspective.
Multifamily IMO is a tough nut to crack because of the people that work in it. I was a property manager in multifamily for a few years, and I've been an Asset Manager in office, industrial, mixed-use etc, for the past few years. Multifamily is the one asset class where there seems to be a disconnect from interviewers. It's the one where most people see the knowledge of market dynamics and the customer service focus as a more important approach. Because incomes directly tie into the cashflow and judges the risk profile of assets directly, it is somewhat siloed from other industries, or at least that's what I've seen.
I worked for a major multifamily REIT and and I can tell you that it's primarily customer-service oriented, weekend-work, competitive, and underpaying. Combining leasing roles with property management roles and sometimes facilities management screws employees. Unless you are in upper-management, stay away from it like grim death, like hotels.
As far as I'm concerned, you don't need to pick an asset class otherwise. I work with all other classes and there's flexibility when speaking with others across industries. Occasionally certain firms will want someone who has experience in just one class, but I see more flexibility otherwise.
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