Thoughts on Family Office acquisitions and exit opportunities?
I’m currently considering a role where I would be sourcing acquisitions for a family office focused on NNN industrial with some retail that has ~$250m in assets. I’d be sourcing deals for them mainly through contacting principals directly to get off-market opportunities, but as with any FO it’s a dynamic role, wearing a lot of different hats so would work on asset management functions and analysis as well. I like the guys but the deals are mainly middle market, less-sexy opportunities and they are yield junkies.
My background is in investment sales on a high volume team for 2 years, and this office was a client I worked with. I don’t have an analytical background which is obviously crucial in the industry.
What I originally set out to look for was an analyst-level role that’s more analytically focused like at REIBs or brokerage shops, where I have some opportunities.
My question is, is working at a mid-tier family office worth it and would there be high-level exit opportunities out there?
so theyre looking to bring you in as their in house broker essentially. Are you a business development/sales guy and enjoy that kind of work? If so you will enjoy that gig and succeed. Are you an analytics guy that does not want to do business development? THats fine too - lean towards analytics at a major shop type role you mentioned. Those will pay well too and very secure, but you wont have the same career or compensation progression opportunities as someone that is sourcing deals. Remmeber that good analysts are a dime a dozen. If this group wants you as a sourcing guy then they clearly see something in you where you could have the ability to go beyond financial analysis and start sourcing deals!
I’ll also add that middle market is where it’s at! Maybe less “sexier” but more opportunity for a young guy like you to source and be a decision maker at your firm and get that bread/equity.
I appreciate the response. I have a business development skillset but don't enjoy it so much because of high volume, low probability (calling as a broker), but I understand this could be more interesting and maybe easier to bring in deal flow. I want to add the RE analysis to my skillset as well.
Do you have thoughts on being able to consistently bring in deal flow from cold calling principals? Of course with the right resources like Costar, Reonomy, etc. and a consistent calling effort.
The group is obviously well capitalized, and can move quickly, but my main concern is that I'll be spinning my wheels for months without bringing in deals which would be a waste of time for both myself and the team.
Can't speak to that company's acquisition criteria, but typically on the principal side for a smaller firm like that you'll be specializing in one or two specific asset classes and risk profiles. This will make it easier for you to get to know everyone in that market/asset class, and narrow down on the deals that'll work for your firm (unless their investment criteria is wacko) Cold calling principals is a big part of it, but you'll also be talking to brokers all the time as well. Most of the deals even if they are off market will have a broker involved in some way, and they'll all love to talk to you and bring ou deals (again, assuming the firm has at least decent buying history) If they're a decent shop they won't bring you in and say bring us a deal or you don't eat. They will give you a nice salary and give you time to build that network and skills. It's not like a desk and a phone Marcus and millichap type boiler room pressure. If yourelooking for a blend of investment analysis/strategy and business development in CRE, it's hard to beat the type of acquisitions sourcing role you described. But don't overlook just climbing up your current brokerage team either. If it's a strong team with room to grow, that's where the biggest money is. Also don’t worry about exit opportunities too much, you’re already in CRE in a legit role.
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