REPE Megafund Asset Management Comp
Hello,
I'm currently a junior at an Ivy with a 3.7 GPA. During SA recruiting I turned down a few IB offers to work for the real estate Asset Management team at a megafund (think Starwood, Brookfield, BX, Carlyle). I want to work in RE out of college and ultimately on the acquisitions side.
I've been told that the AM team I'm joining works closely with acquisitions and is modeling intensive, so I think the experience will be great. However, amid recent discussion of REPE AM on this forum, I'm wondering if analysts in AM are paid similarly to those in acquisitions at megafunds. And if not, then what is the size of the haircut.
I understand this shouldn't really concern me at this point since I haven't started my internship and the road to getting a return offer will be difficult, but I'm still curious to know what all in comp for AM analysts looks like at megafunds.
Thanks in advance for any insight.
to play devil's advocate, i just want to say that a) you DON'T have to be a fucking investment banker to get into the equity side in real estate and b) there is nothing wrong with asking about junior-level comp at a fund
unfortuantely i don't know what the pay is like. HOWEVER, take a look at this http://celassociates.com/prime/wp-content/uploads/2012/04/CELAssociates… would i be surprised if you make the exact same as a megafund acquisitions guy? yes, because that's probably the highest-paid junior-level job you can get in this entire industry, and asset mgmt is way less sought-after. but i would STILL expect them to pay you pretty well if your'e doing modeling-intensive stuff in asset mgmt at one of the places you mentioned. i would be shocked if the pay sucked to be an asset manager at Starwood in CT. that just wouldn't make sense.
Not sure why everyone is hating on the fact IB will give you better exit options. That's a fact. In this industry, an overwhelming amount of the strong acquisition roles are handled by headhunters who undoubtedly favor bankers over AM guys for an acquisitions role.
That being that, this is an industry where you can network your way into a strong acquisitions role from being an AM analyst at a top firm. Developers looking for an acquisitions hire might view your AM skillset more favorably than an i-banker skill set as well, while general REPE firms probably won't.
Last thing I'll point out is if you want to be in real estate, why head into banking? In my opinion, it's not worth wasting 2 years slaving as a banker when you can enter a crucial facet of your target industry from day 1. Asset Management is wildly important, and if you're handling opportunistic deals for the funds you mentioned, there is bound to be stress in a handful of deals and you'll learn a ton.
Not necessarily contradictory. I'm throwing out some considerations which anyone can decide to consider, or ignore.
My point is that headhunters are the gatekeepers to most solid acquisition roles, and they typically take i-bankers over all other entry level roles for their assignments. This does not mean that they are making the best hiring decisions, but nonetheless, it's what they typically do.
In the last paragraph I'm pointing out that if your goal is to be in real estate in the long haul, then it's not worth worth going into banking just so you can have incrementally better exit options to an acquisitions role after you finish your analyst stint. While headhunters don't value asset managers as they should for acquisition roles, it is still an incredibly important and useful skillset if you plan on having a career in RE. Sure, exit options to acquisitions won't be as good as a banker's will be, but they're still solid and you will have been spending two years in the industry you want to work in.
Couple things:
former I-bankers tend to demonstrate ability to handle rigors of deal process, underwriting and communications. I've worked with quite a few former bankers now in RE. Some hiring managers think they are better off hiring on demonstrated talent and teach RE specifics. Of course, this pertains to analyst and associate levels mostly (maybe higher levels if on existing asset acqs vs JVs or development).
I find that there is a personality difference between deal oriented folks and asset/project managers. Ask yourself, and you will face this, if there was a new acquisition/financing to work on with 15% chance of actualization and an interior design meeting where the team will decide between chrome or brushed nickel plumbing fixtures and other specs, at the same time competing for your attention, what would you do if you could freely choose?
An acquisitions brain is a hellava drug. Can you slow down and dive deep? Are you naturally inclined to make a few projects your baby for years and years? Know that different firms at different head counts, stages of company lifecycle have evolving talent needs.
AM or IB? Starting your career. Depends on the RE shop. Depends on the IB sector. If you are doing TMT banking (tech) and you want to do CRE, you might think you are wasting your time and have waning interest. Maybe you're doing consumer goods or industrial sector then there is more brick and mortar relevance. AM can be good and better hours except for year end strategic biz planning. Need to see what your personality type BC if it's more Acq, you might feel like you are second fiddle to the deal team who is cranking out deal memos non stop. So answer is it depends.
I personally would do two years of banking while you're young.