Transferable Skills - Acquisitions to Asset Management
Hi Everyone,
I currently work in hotel acquisitions as an analyst for a REPE firm but job security feels a bit unstable so I've been interested in pursuing other opportunities.
I have a hotel AM analyst interview coming up but I have zero AM experience. So I'm curious - what skills gained from an acquisitions role do you think will transfer well into an AM role?
These are some of my thoughts:
- Market knowledge/demand generator research
- Supply research and analysis
- Familiarity in hotel operations
- Transactions experience for analyzing dispositions
It would be helpful to hear about this from the context of hotels but any other opinions on the other asset classes is helpful too!
How do you have disposition experience? I thought this was typically done by AM?
Sorry, I meant like because I have transaction/deal experience from my current acquisitions role, maybe that would translate well into dispositions if I were to do AM.
At 1 year experience...do you understand terms and use excel is about as important as it gets. Thata and personality and fit.
Yeah that's probably the most I can get judged on this point. Thank you!
edit: realize this is messy/all over the place, might come back to edit later with more time.
you'll probably be good from debt/equity side of things (i.e. underwriting, modeling, front-end transacting), and understanding the impact of performance to partners, distributions etc.
dispositions, although transactional in nature, is a bit different than acquisitions. depending on the firm, it's usually "driven" by asset management because they have key insight into the market, trends, asset, and the teams in place on the ground. Has a revenue manager position turned over in the last 6 months? has the general manager position been open for the last 3 months which is causing performance to slip? have two new hotels opened up in the past 6 months that are capturing market share/occupancy? what are you doing to combat all this and maintain underwritten performance? upon sale, the story and why this is a good investment for someone else than modeling out proceeds and vying for cap rate compression, albeit still important. but having transaction experience i imagine is certainly helpful to have.
also, from an asset management perspective, i'd say it's mostly about operations. are you going to be getting on calls with the contracted management to discuss monthly performance results? are you going to be speaking with a flag about performance results? it's also super critical to know, and understand, the documents/management agreements. in acquisitions, you probably read through the loan documents and JV agreements to figure out the model and distributions. those documents are important to asset management as well but also the management agreement/contract since you might have to have tough conversations about lacking performance and changing out an operator/manager. you research, trend analysis, etc. is probably more important here than knowing what current cap rates are in the market.
as an analyst, you're probably going to do more listening on calls and doing back-end analysis/Excel stuff than needing to lead an ops call and pressing the management team on why they are sucking or whatever.
Thanks this is super thorough and a very helpful comparison! One of the job responsibilities is to prepare hold/sell recommendations so I'm assuming that my experience from underwriting would be relevant and helpful as well right?
yes, from the analytical perspective. you should be able to model pretty easily sales proceeds, any applicable early payment penalties, refinancing, and use of proceeds. i think the ultimate decision will depend on the firm's investment thesis and why you should sell now vs. continue to hold (i.e. no more NOI growth, no more cap rate compression, sell now before 5 competitors open up in the market, keep holding because we just terminated management contract and expect more growth, etc.). sell hold analysis, to me, is way more intricate than I ever thought it would be from a strategy perspective.
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