I'm looking to make a career transition from Real Estate Development to Real Estate Private Equity. Although I enjoy Dev. the Bay Area market is notoriously difficult to operate in, and the deals take eons to complete. I have been drawn towards to financial aspects of the industry, which for development is really just 1 of 100 things you need to have an understanding of to be successful. I was lucky to have gotten the job out of college, and have been working for the company (regional office of national MF developer) for 3.5 years, wearing many hats (as most developers do), but have not had a chance to develop my quantitative and financial modeling skills, as the heavy lifting in that area was taken on by the national capital markets team. I am of course familiar and comfortable with the basic proforma underwriting to a YOC, but relied heavily on template models to run the cash flow analysis for IRR, Equity Multiples, waterfall's, and other metrics.
In my search, I've circled Acquisitions positions as targets, given I've had experience dealing with these groups running due diligence on our deals and found their roles and perspective to be interesting. Having gotten a few interviews, I've found that without the quantitative skill set most groups are not as willing to take my bait. I'm now considering positions in Asset Management for well known and respected groups, thinking that I could build up my quantitative skills and potential transition to an Acquisitions role.
If I'm looking to build a career in Real Estate Private Equity, is this a sound approach? Are there any other positions/sectors that I should be looking at as well?
Out of curiosity, why do you want to switch? I don't mean to be insulting, and I have a huge bias (as a developer), but working in the "financial aspects" of the industry sounds like an incredibly short term goal. What is your long term ambition? There is a lot more room to make money, to be your own boss, to build your own projects, on the development side. And frankly, the skills you'll continue to learn as a developer will be far, far more valuable down the road than leveling up your financial modeling abilities.
IDK, maybe this is my aforementioned bias flaring up, but the odds that you (or anyone else) manages to start a successful REPE firm are so miniscule as to be nonexistent. On the flip side, it's not crazy to think that you might find a deal that makes sense and raise some equity to execute on it, and get on the road to having your own development shop. And I assume that being an owner/GP/having significant carry is the goal for anyone involved in the RE industry.