LP to GP Learning Curve in Asset Management
All my AM experience is on the LP side. If I were to move to the GP side, what should I expect in terms of learning curve? I think it comes down to coordinating between groups like leasing and operations and understanding the nuances that go into executing leases, contracts, etc. anything else?
Swinging from the LP vines to the GP jungle, eh? Well, based on the most helpful WSO content, here's what you should brace for when it comes to the learning curve:
Hands-On Experience: On the GP side, you'll get more hands-on experience with the deal. This means not just sourcing the deal but also executing the business plan to earn a promotion. You'll be involved in leasing, capital plans, development, and redevelopment, among other things.
Local Expertise: You'll need to develop a lot of local expertise in a given region. This is because GPs often have a more focused strategy and may specialize in certain types of properties or regions.
Deal Structuring: You'll need to understand the various LPs' programs so you can structure deals to fit with one or more of them. This involves a deeper dive into the financial and operational aspects of the deals.
Asset Management Depth: Your work on the GP side will be deeper, especially from an asset management perspective. This could involve meeting with brokers & tenants for leasing projects or working with architects and contractors for design and build.
Coordination Skills: As you mentioned, you'll need to coordinate between different groups like leasing, operations, and possibly construction. Understanding the nuances of executing leases and contracts will be crucial.
Entrepreneurial Skills: If you have an entrepreneurial streak, the GP side can set you up better for doing deals on your own in the future. It's a path that can lead to raising your own funds and starting your own ventures.
Remember, while the LP side gives you a macro view of capital deployment and financing, the GP side will immerse you in the nitty-gritty of real estate asset management. It's a different beast, but one that can be tamed with the right mindset and skills. Keep your bananas peeled for new learning opportunities, and you'll adapt to the GP environment in no time!
Sources: GP vs LP - Which is better, Leaving Investment Sales for Small/New RE fund - sound worth it?, GP vs. LP Day
I've always wondered what Asset Managers at LP firms do.
Portfolio management - They ask the question about buy or sell and make sure the GP AM knows what's going on.
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