RE analyst/associate pay & Schack MS in real estate - pivoting out of FPA at BB.
I currently work at a BB doing FPA as an associate. I have about 2 1/2 years experience. My internships in college were at a small real estate asset management firm (alum from my college, 150 commercial/ residential properties overall valued at around 1B.) I make pretty good money. in the low six figure range. While the pay is nice the work is mind numbingly boring. I feel like I add absolutely zero value and I never really need to use my brain for anything. That may sound like a dream job to some people but I honestly couldn't see myself doing this for a career and being passionate about it.
I am VERY passionate about real estate. I close on my first residential investment property in a month. I took real estate finance in college at the MBA level (from a top 30 school) and have those 2 years of that internship experience.
Enough about me. I am seriously considering a pivot out of banking and into real estate finance. It's what I am passionate about. The schack school really stands out to me however from researching this forum it seems not very competitive to get into. My questions:
1) would dropping the 100k be worth it?
2) with my FPA experience do you see me coming out of the MS at an analyst or associate level?
3) what does associate level pay look like at a RE development firm? How about at a REPE firm?
4) do you think a pivot at 4 years of experience would get me a good ROI? With my current pay I could afford to go without taking on debt. I obviously lose out on the opportunity cost of that cash being invested young.
Thanks.
1.) Depends. If you can break into REPE/Dev without going back to school, then no it’s not worth it. If you can’t, then it’s only worth it if you make it worth it. Schack is not NYU Stern. Companies will not come to you…you have to go to them. You will see 2 types of students at Schack. The first type are the ones who think they are at NYU Stern and they just cruise and continue their original job in leasing, property management, construction, etc..and when they graduate, they remain in these jobs because they didn’t maximize their time at Schack and pursue relevant internships in the jobs they aspired to work in. For these students (the vast majority) it was a waste of time and money in my opinion. Then you have a handful of students who take night classes and pursue relevant internships during the day (REPE/dev/RE finance). These students didn’t come to Schack to learn because their really isn’t much to learn (The program has students from a variety of backgrounds, so it is tough for the program to teach you more complex financial modeling due to the students with 0 finance background. So if you want to break into REPE/dev, you will need to learn financial modeling on your own.) These students came to Schack to pursue relevant internships and leverage those internships into full time jobs.
2.) Analyst
3.) In HCOL market, Dev: 80-100k base, 20-30% bonus.
REPE: 90-110k base ~50% bonus (maybe someone else can give you more accurate figures. I’ve been out of the job market for a couple years)
4.) If you are truly passionate about real estate then yes. You will only be great at something that you love. And you are still young.
Source: Schack Alum who had a very similar background as you and secured those REPE/development offers you are referring to upon graduating
[Edit] Now that I think about it, 4 years out of UG working in FPA might make it pretty tough to break into REPE/dev without going back to school. I made the transition after spending only 1 year in a back office role
I really appreciate you putting this time into answering my questions and if you would be open to it would love to connect.
Thanks my man.
For sure, PM me anytime
just to reply to your edit - I have 2 1/2 YOE currently. Id leave my job immediately for an opportunity in real estate
1. Grad school cost benefit really depends on what you're after. I spent my 100k to meet new RE friends, and so was very careful in picking a RE program. May be your reasons are different and you'll have to justify that yourself.
2. 50/50. More likely analyst. But don't let us sell you short, apply for the job you think you deserve.
3. Ranges from all over. Given you have 0 years of experience in RE, it could be a low number. In NYC, entry level pay (which I would have to unfortunately lump you into this catergory) may be 100-150k all in.
4. You seem young. My only advice to you is, if you think RE is something you'd like to do long term (lots of us here have family assets we'll have to look after 10-20 years from now or if you actually would like to be a RE professional, this one much harder to know) then I say make the switch. RE is a unique sector in that many people came from RE money/family whose wealth are tied to an asset class with very high transaction costs to buy/sell constantly and thus become a generational wealth thing, needing people to look after.
Reach out to people for coffee man. This kinda question you have is hard to absorb via this platform.
Thanks. A director on the acquisition team of a large firm put the idea into my head. Used to work with him during my college internship. Meeting with him on Sunday for some coffee. He offered to put me in touch with 5-6 Schack alums.
All in all 100-150k is what I make right now so if analyst salary's are really looking like that right now I wouldn't really mind. I have my own investment property that is owner occupied that I live in rent free about 30m outside of NYC.
Lastly, while I do not have the generational wealth tied to RE I do have a pretty big passion to start that for my family in the future. That also is a big reason for me wanting to pursue this. Even if I ended up staying in FPA after the degree (which I really would not want to do) it would give me a jumping off point to do this on my own and raise some capital.
Thanks for taking the time.
If you work at a BB, try and reach out to people who work on the real estate investment teams and see if you can internally transfer. Goldman, Morgan Stanley, DB, and JPM all have teams like this if you’re at one of these banks.
Thanks for the reply. I work in a MO/BO function and have heard that a transition towards a more frontward facing role is near impossible. That kinda makes me hesitant to even begin to go this route. A perfect scenario would be to do the masters part time and then internal transfer but just given the posts on this forum I see the probability of that outcome actually working to be less than 1%.
Heard you and this makes sense for sure. If I were you, I’d still reach out to come people and try and connect. If you are serious about getting into the space, it could potentially help you out down the line. Especially if you do the masters program and want to join one of these groups after. They pay well, especially for the real estate space.
I was switching from FP&A to REPE and almost went the MBA route before I found an analyst role at an owner/operator. I'm so glad I didn't do the MBA, because I avoided debt and spent those two years getting actual work experience. I think with the right amount of networking, you can find your way to an REPE job. HOWEVER, you'd likely have to start over as an analyst -- the work is just too different from FP&A that firms won't let you start as an associate right away. This is where getting an MS or MBA would be helpful, because you'd increase your chances of starting as an associate, making $90k to low $100k's plus bonus. Comp really varies based on geography and firm. Look at the compensation doc in this forum.
.\Thanks for the info
REPE Assoc. numbers at MFPE are $130k-150k base + 30%-40% bonus for AM and the same base + 75%-100% for Acq. Range will widen next bonus szn.
It varies, but those are direct comps.
Also, not unheard of for a similar background to start at assoc. 1 level but depends on the firm.
Is the delta between AM and acq that much? Don’t know too many people on the AM side outside of work but 30% to 40% seems pretty terrible.
In general, no. In years where these funds are committing several bn? Yes. I wouldn’t be surprised if there was no delta next year.
Terrible relative to what? Still taking home more than most acq. associates in HCOL cities at smaller shops. At the end of the day, you’re not driving as much business. That said, you’re developing more valuable skills (imo) that are directly transferable to the next rung of the ladder.
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