I know the difference in duties of what goes on in real estate banking and real estate investment banking. However, my question is would a real estate banking analyst have the same/similar exit ops as a real estate investment banking analyst? Real estate banking analysts are pretty well trained in excel and credit analysis, know how to look at different deal structures, and everything else you ask of them for their level. Only real difference is real estate banking is involved with providing institutions with debt or helping them recapitalize. Whereas, investment banking is involved with raising capital and M&A.
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Short answer, no. IB has different "exit ops" than commercial/traditional banking. It really doesn't matter if throw "real estate" on in front of either of those.
Long answer, while there is clearly overlap in the jobs, the businesses are actually pretty different. IB really can be true 'deal making', and an analyst is part of a fully functioning deal teal. Banking is really a from of principal investing, in the form of debt assets. That is why the 'debt side' keeps being a 'thing' on WSO. It's a big world, but just more narrow. IB deals focuses on entity level (sometime property/portfolio level, but less common) financing transactions. Far more complex and involved. The structures, legalities, and models used are very different (even the concept of valuation, a big deal in IB, is very very different). It's this experience that makes IB so valuable. It can be part debt lending, part equity raising, part valuation, part consulting, and part investment sales.... all at the same time. M&A is basically the same as 'investment sales' accept that it is for entities and more consulting/valuation work is required and performed by the IB.
Finally, while banking does require some excel skills, most bank analyst work with pre-formed bank models. IB requires a lot of custom from scratch modeling. Plus all the uber tight deadlines. Thus, I just can't see them comparable. Each is good for what it is good for, and there are shops that sorta do both on the same team, but it is still a different business.
What makes this really tough is that "real estate investment banking" has become a loose term that many debt/equity brokers use. In fairness, they are doing IB type work but should in no way get confused with a Goldman Sachs style operation. That said, a lot of the business the GS/MS/BAML types do is the same as the debt/equity placement shops and even the IS brokerages sometimes. Everyone is out to earn to a fee, that is what they all have in common!
There's certainly fundamental differences between the two, but also overlaps. Let me give you an example to illustrate. I personally worked on numerous transactions for ESR Cayman - a large and growing logistics player in Asia Pacific, and expanding pretty much everywhere.
What my colleagues in real estate banking (falls under corporate banking) work on: primarily property level (whether a single or a portfolio of assets), and primarily non-recourse debt financings.
What I/my colleagues in real estate investment banking work on: capital restructuring at both property/portfolio and ESR corporate level, IPO, corporate M&A with, say certain assets of GLP, Prologis in the US, corporate level debt financing (e.g. senior unsecured bonds).
By no mistake, for almost all investment banking transactions, we rely heavily on our corporate banking colleagues for inputs on things like quality of underlying assets. For example, we on the IB side are not intimate to the rent roll/tenant base of a property as we don't cover individual assets, but our corp bank colleagues know them cold because of their credit/lending relationships, monthly/quarterly covenant checks and site visits, etc.
To sum up, the fundamental difference is that investment banking is a transaction/deal-driven business, and corporate banking is more relationship building and maintenance (on the back of a bank's balance sheet). Exits likewise would reflect such difference given the variance in skill sets and experience; e.g. IB folks tend to progress onto transaction-driven roles such as PE/REPE. At the end of the day, it's not a matter of which is better, but which fits you better from a career perspective.
solid explanation.
I would just add, however, that real estate investment banking and real estate banking analysts can both exit to asset-level REPE roles. I came from the REIB side and my colleague the real estate banking side. Same job, same comp.
Lmao thanks for the monkey shit. Unlike some of my fellow IB bros I'm not salty to admit non-IB folk can be smart and hardworking enough to do the same job as me.
How fragile is your ego??!??
I have no idea who gave you MS, but I gave you some SBs to even it out. I have the same background as you (IB to REPE on the asset-level) and have also experienced the same as you. I know people who've gone from Wells lending to Starwood, Carlyle, etc. even. No idea why you got shit, it's a completely reasonable statement.
Hey, CRE @ WF here very curious about how this job can lead to opportunities in the buyside. Would love to hear about the possibilities of that in your experience as you mention that you've seen prior people come over.
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