REPE Finance Groups

I did audit and then went to REPE (top 10 firm), acquisitions. Not easy, I got extremely lucky (non-target school in new city, but interned in RE accounting in college; lucky for me, this was the peak of the last cycle in mid-2000's and there was a lot of capital to be placed; the firm I interviewed for was very picky and then finally I came along). If I tried to do this today, I would likely not have much of a chance without Grad school (MBA, MSRE). The analysts in my old role are mainly from target undergrad schools (Haas, Wharton, etc).

I'm in RE today and get asked for advice how to break in. I feel for you. So, my gameplan for 2014, if I was in audit 3 years, would be to:

1) Buy a notebook and HP-12c. You are going to write down what you learn from people. You will follow up on names, companies, deals, etc and research these things and get familiar. You will carry the HP-12c because you want to be an analyst, and an analyst is always ready to crank. I'm now someone who hires analysts and if I see these qualities, I am seeing a good first impression on me. Actively listen, because I only want to explain once (you must do this when you are talking to audit clients).

2) Join ULI, especially get involved in the Young Leaders Group if your city has one. Start to have your face seen by people in the industry. Real estate people are social creatures. It's a relationship business.

3) Develop your story, especially about your life long passion for the industry. Hiring managers will not fault you for looking for life after public accounting; however, you need to be able to justify your past decisions and explain how you are strategic with your career decision making. Since you seem to want to be on the investment side, you need to show the personality to be a deal maker (important for anyone interviewing for these jobs). Typically, you need to demonstrate drive, vision, financial modeling skills, accountability with deadlines, attention to detail, and an outgoing personality. Show that you want to eventually do deals. Public accounting helps in this storytelling. If you attended a school where Big 4 public accounting is one of the best jobs you can get through recruiting, you are a solid chance to play the "small town to riches" story (I did this). I attended the University of Hawaii. If you can see yourself investing, developing commercial real estate for the rest of your life, well into your 80's and you want your kids to join the business, then you are potentially someone who gets my point.

3) With your story and new contacts in ULI (you attend these events after work; make sacrifices, sneak out of the client office, stay up late learning), your next step is to familiarize yourself with real estate finance (your best route due to your financial accounting background). Like accounting, real estate investment analysis is an observation of several variables, particularly capital markets behavior (think Austrian Business Cycle Theory). I read forums like WSO (back then TheVault was the place for info). Back in my audit days, I purchased and read the following books: Real Estate Finance & Investments (Linneman); Term Sheets & Valuations (I was also interested in VC and PE); ULI has books with case studies. Earlier in high school and early college, I played Sim City (never mentioned this in interviews though) and read The Art of the Deal. Read soft skill books from authors Dale Carnegie and Napoleon Hill. Back then, Argus had a free trial download. Play with it. Read real estate case studies, OM’s (offering memoranda) that you can google on the internet. My point is, rapidly build up you real estate knowledge and write down insights in your notebook. Eventually, you will know what an investment thesis is (ask yourself why should I invest in this asset/company? Relative value, why is this the highest and best use of my money?

As a 3rd year, you'll probably be busy, potentially you are a senior on audit jobs. I left audit after one year to REPE, but after you do steps 1-3; you need to start applying for real estate investment analyst roles (acquisitions or Asset Management). What kind of city do you live in? If you are in SF or NY (financial capitals of their respective coasts), there will be more analyst opportunities for investment companies. Other cities, it will depend. See selectleaders.com and look at the jobs there (SF/NYC).

Early in your career, you should try to achieve the following: high deal flow (4-6+ closed transactions per year), diversity of markets, and diversity of asset types. A top REPE will give you 3 out of 3. A commercial lending group will give you some of this, but you will not get to waterfall underwriting until you get to the equity side. My point is, if you don't get REPE, go for lending to get deal flow/markets/asset types. Continue developing steps 1-3, and in 2-3 years you will have an even stronger background to move closer to your goal. In fact, for every year in RE, you will become more experienced and hence more marketable.

So, my advice to anyone. You can try to get REPE and all those prestigious RE jobs, but look at your career as a development project. There will be starts, stops, but perseverance is key. In development, you can run out of money and be in trouble. In your RE career, you need drive, vision, financial modeling skills, accountability with deadlines, attention to detail, and an outgoing personality (even this you can work on). If you run out of drive, you’re done. It definitely helps that you know how to work (different from being good in school). Keep it Simple Stupid (KISS); triple check your work; seek inefficiencies in mundane tasks; find a firm that you eventually feel loved; and be grateful and a little bit fearful that you are in the chair that is coveted by many others. Your audit experience should help you use excel without a mouse (if not, learn it) and teach you spreadsheet do’s and don’ts for executive presentation. If you are a typical undergrad business student, I hope you brush up on your business writing skills. As an analyst/associate/director, etc you will be involved in the preparation of investment committee memos. Learn how to write. Familiarize yourself about real estate cycles and investment risk. You will sound more mature.

Be grateful for your Big 4 experience, and move on (96% of your peers eventually do). It helped steer you to seek a career you are passionate about and its a great entry to the work world.

And when you learn the ropes and get it. Mentor others. THIS is real estate.