No IB RO considering RE
Title
Felt IB was not intellectually stimulating. Learned excel and ppt very well but nothing about strategic thinking on what actually makes a company valuable.
Want to learn an investment strategy/general acumen whether in businesses(PE) or RE so I can one day invest in my own as well on the side (at a smaller scale).
I think reps, mentorship, and learning are more important than anything else for me. I'm focused on learning the fundamentals over compensation at this stage in my life. Don’t mind if this means being at a smaller shop. Welcome other perspectives if people think this is the wrong approach.
Curious what roles/shops/titles or other approaches could be recommended for this - what should I be looking into. I believe I would be most interested in Core+, Value-Add and Opportunistic strategies. I consider RE as I lease, manage, and run bookkeeping for 4 single family rentals and see it as a great personal finance strategy
Based on the most helpful WSO content, here’s a breakdown of your situation and actionable advice:
1. Your Focus on Learning Over Compensation
2. Core+, Value-Add, and Opportunistic Strategies
3. Recommended Roles and Shops
4. Your Background in Leasing and Managing Rentals
5. Alternative Approaches
6. Next Steps
Your focus on learning and strategic thinking will serve you well. Whether you choose real estate or private equity, the key is to immerse yourself in roles that challenge you and provide exposure to the fundamentals of investing.
Sources: What are the Roles within Real Estate Private Equity?, Life decisions...buy-side equity analyst, https://www.wallstreetoasis.com/forum/real-estate/running-your-own-shop?customgpt=1, Most academic style of investing that requires the most thought?, To Those Who's Had A Successful Career In CRE, What Advice Do You Have For Younger Generations?
The reality is, entry level real estate analyst roles at megacorps are not intellectually stimulating either. Still, with your IB background, you should try to gun for a big name firm, put a couple years in to boost the resume, and then either get promoted into a decision-making role or leave for one at a smaller firm.
This. If you think IB isn't intellectually stimulating, then CRE sure as hell won't be
Understood, the beginning is going to be grunt work and I’m willing to do that to gain some skills and have creds for my resume.
When you say start at a big name firm do you mean in CRE or IB/PE?
I get start big > then move up in position at a smaller firm. What are your thoughts in going straight to a MM/LMM firm in REPE or PE?
IB > ?
If you’re willing to roll the dice a bit, go work for your hometown, local dominant family owned PE/REPE firm, and aim to eventually move up to be a lead non-family executive.
Examples in my hometown (Hawaii) are MacNaughton Group, Kobayashi Group, Tradewind Capital.
They invest predominantly in real estate, but also local and increasingly national and international businesses.
I believe every somewhat medium to big city has firms like these. They are very locally in the know. Respond to multiple P3 RFPs, some pivoting to affordable housing, some understand arbitrage, overlooked opportunities, local business succession M&A, etc.
These kind of firms seem the safest, most sustainable, diverse in interests, sometimes sophisticated, and frankly the most impactful to a place you care about (ie your hometown).
This sounds interesting. So they look for any struggling business or potential RE value adds/opportunities in my locality and find ways to make them lucrative
I believe so. Bread and butter is real estate, but delve into other opportunistic ventures. In the 1990’s/2000’s, for example, MacNaughton got some kind of license to bring Starbucks to Hawaii. That’s super cool.
They do like to hire the local kid who went away, got great experience, and coming back home to live forever.
Especially if your hometown is like a secondary/tertiary market, that is not saturated by the national players. But big enough. I love college football and look at conference expansion markets and places like Hawaii and El Paso, TX for example are very niche, and they would have their own local McDonalds commercials targeting their population. Kind of an insider game, in a market just big enough. If you come from this kind of place, there are firms like these (or maybe start your own if there is none).
I worked in REPE for four years, it won't help for a small single family portfolio. It'd help you raise capital or buy commercial properties. Is this your end goal?
If not, I'd encourage you to find another IB role. Banks pay more and have better career progression. CRE has been struggling for a while now and isn't a good place to be currently.
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