What real estate department should I go into if my end goal is to invest in commercial real estate?
Pretty self explanatory, my end goal is to build a real estate portfolio and so what department should I consider going into in order to gain as much experience possible in how to build a successful portfolio. Currently thinking about either asset management or acquisitions but would love to hear y’all’s thoughts on why one is better than the other or may be some other department that would best fit my objective.
Thanks a lot!
Debt Asset Management
Can you share more details on why debt AM?
If your goal is to run your own portfolio, I would recommend a small family office. At small family offices they typically can't afford to hire too many people and you end up doing a lot of different roles. I know of a couple local shops that have an analyst that does AM, acquisitions, and helps with the capital markets because they aren't big enough yet to hire multiple analysts to specialize. If you go down this path, there isn't a massive salary and large bonuses, but it's typically the fastest route to getting equity in deals and getting deal exposure in multiple facets. If you want to make a bunch of money to be able to invest as an LP in deals later on, I would recommend acquisitions roles in bigger shops.
"If you want to make a bunch of money to be able to invest as an LP in deals later on, I would recommend acquisitions roles in bigger shops. "
I respectfully disagree, these are institutionalized roles so you're going to be on the standard corporate grind. Sure salary will be $100k + $25 K bonus starting, but is that really the fastest way to get enough money to get your own deals? Nah. People are 40 years old as VP, making $250k salary and a few hundred K bonus, maybe if you're lucky. Not worth the grind IMHO.
Fastest way to make $ is grind in brokerage by joining a high production team or even better just start a PM company and grind it out that way.
Only people disagreeing with me on this are golden handcuffed.
Can you make millions as a broker? Sure. But for every millionaire broker, there are 15-20 that made $0 over multiple years and quit, and even more than only ever make what an acquisitions analyst would make year 1. There are very few extremely wealthy brokers and you are never guaranteed a paycheck in brokerage. In a "standard corporate grind" you can work for someone else and make a lot of money and with proper personal finances you can save up enough to do a small deal after a couple years. Is it the glamorous way to make money? No. But if you're an associate with a total comp package of ~$150-175k depending on the market, you could easily save up enough to be an LP in a family office deal or something of the likes after a few years.
There are always going to be a vocal minority that boast making millions really quickly but what you won't hear is the thousands of failed brokers or brokers that just get by but love the WLB. I wouldn't say any one avenue is the best way to make money the fastest since one is a guaranteed stream of income and one is very risky. I think there are a lot of brokers wishing that they had a couple hundred thousand dollars of steady income right now, but they were also swimming in cash during 2021 when money was free and everyone was buying anything they could get their hands on.
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