Opportunistic Investing Cycle
So obviously there’s a lot going on economically speaking and the real estate world is in a stalemate in terms of a bid-ask spread.
For those that have seen cycles before, which honestly speaking is probably very few of us given rates over the last decade, when do we start to see sellers forcibly show their hand and start to submit? There’s record amounts of dry powder in the world and very few purchasing opportunities. Secondaries and debt funds are a great place to be at the moment; but when do we truly think opportunistic acquisitions will pick up?
I’ve recently left my firm, to no fault of my own, just simply because there was no work to do in a relatively new team in an established organisation. I don’t truly want to drop my pride yet and take up an asset management role or local development role that I’m being shilled but I don’t think I have a choice. I would love to join a SWF / established Family Office. Personally I don’t think it looks good to take a short-term role (6-8 months) before jumping to another shop. I don’t know how firms will perceive this. Will there be prospects in a downmarket for candidates that come from a top-tier background if I wait 3 months? Stupid question but it seems that recruiters don’t have any roles at all at any relatively established shops.
Hey Analyst 1 in RE - Comm, the following topics might be helpful:
More suggestions...
I hope those threads give you a bit more insight.
Drop your pride for asset management?
What would you do for 3 months while waiting for something to open up? Do you have the funds to float yourself if it ends up being longer than that?
You're essentially trying to time the market based on what you expect sellers will do and how you expect buyers will respond. Unless you have something productive to do while you're out of the job market or need a break from working, it doesn't make much sense to wait for your dream role to open up. Take what's available. If it's asset management at a decently reputable shop, you'll learn a lot of valuable experience if this downturn lasts any longer than ~6 months.
Something doesn't add up here. You left a paying job you liked because there wasn't enough deal flow, but have too much pride to take up an asset management role?
Asset management can mean a lot of things, I guess, but in a real estate context I don't view it as a back office role, so unless our definitions vary wildly I don't see why this is a "pride" issue. Either way it's a valuable skillset and knowledge base to have, so if it pays your bills and you do it for a few years while waiting for an opportunity that is a better fit, what is the downside?
And local development... versus what? Most development jobs are local. A firm might be national, but it's pretty rare to work on 3 different projects in 3 different regions. Frankly, I don't think it's possible to do a good job - codes are different, politics are different, etc etc. Might be time to rethink exactly what your endgame is.
Yes it's rare but it's fucking amazing and not impossible by any stretch unless your team is bunk. Gotta have a really talented team to pull it off. We're working on 8 (re)/development projects in 7 cities across the US, it's not rocket science. You just need the right local partners to team up with whether it's expediters, lobbyists, zoning counsel, incentives specialists or a straight up co-GP.
I'm in the same boat but these jobs are few and far between, for the most part he is correct. Nothing wrong with working in local/regional development. Some of the smartest minds in the business are there.
Agree we got very rare seats, and in general his point is right for the vast majority of shops. I was more so trying to point out that development being a locals only game is not true. It's really not that hard to come into a new market and figure out how to navigate it, just takes some extra time, but by no means requires years or decades of local experience to succeed. It's definitely the local guys that make the biggest killing through because they have the best nose for the right sites/properties and tend to pick apart the good stuff quietly before it ever even gets the chance to be marketed or sniffed out by an out of town shop like ours. Hell, they don't even have to develop, I feel like the most successful local guys I've encountered just flip land sites to guys like us.
Why did you willingly leave your job, specifically in this environment? Deal flow is slow everywhere right now. That's not a good enough reason to leave (in today's conditions), regardless of team/org.
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