Hello
I bank on the technology side of things but would really like to do a RE deal. The MD is happy to have me but says I will have to hit the ground running. He did not give much in terms of what I should know or what I can read. He estimates I can help this summer so I want to read and or do what I need to be ready to assist as an analyst. Anyone have any ideas?
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Anyone?
what are you talking about?!?
Unless you already knew it, a REIT is essentially like an exit for a developer or property holding entity whereby they sell the RE assets into a listed vehicle (the REIT). The Reit funds the purchase of the assets via the money it collects from investors who pay for the units in the (usually) listed trust that will pay them distributions sourced from the rental on the properties. At least this is the way its usually done in markets like SG in Asia.
As such, what kind of RE deals do you want to be doing? Are you talking front end development or back end off-takes like sales into REITs? Clarify that and some of the people on the forum should be able to help you
That said, you can always get insight on the kinds of deal structuring that goes into the process (at the front end and at the back end on sale into a REIT) by reading the prospectuses for listed REITs. I work in Asia so i only know about REITs done in this part of the world, so if you are in the States (where the market is alot deeper, wider and overall more developed) you should just check on prospectuses for REITs listed in the US and read those. In Asia, if you want, look up the prospectuses for CapitaCommercial Trust and Macquarie International Infrastructure Fund Limited (both listed on the SGX).
They do mostly equity offerings, exit stuff.
Read "Investing in REITs" by Ralph Block, and get your hands on some equity research reports. Block also has a great blog "The Essential REIT" that you should read. He has years of experience in all markets for REITs, and offers a good up-to-date perspective on the industry. My advice is to steer clear of mortgage REITs as their earnings depend on the interest rate environment and their spreads: they are very volatile and can come back to bite you in the @ss, though I am sure that decision will not be left up to you. Why don't you talk to some of the analysts currently covering REITs to get an idea of what you'll need to be able to do on day 1. Good luck.
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