When will acquisitions hiring pick up?
Particularly for analyst positions. Have been looking to transition, but seeing very limited opportunities
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Generally picks up around late Q1/early Q2, after bonuses. But with the markets being what they are, who knows how much it will really pick up next year.
People typically don't want to hire around the holidays so I'd assume late Feb through end of April mostly. Also, with interest rates where they are at, the acquisitions teams are going to be mostly on the side line until pricing adjusts and with a potential recession people might even be laid off instead of hired.
But once a recession does hit, wouldn’t pricing adjust at that time? Thus Not leading to layoffs ? If anything, wouldn’t the layoffs happen now since there’s no transaction activity?
That's right baby. All we need is movement. Price is up, price is down, price is left, price is right. I don't care. I just want trades
Pricing is always slow to adjust. How fast or slow is anyones guess. But it is not like the public markets where it is very fast. Pricing could take 1-3 years to adjust. Not every seller is a willing seller at a lower valuation. And they may not need to sell. Which means they will only sell when needed. So those that can refi instead of sell, will do so. Which means pricing may not adjust as fast as you think because less trades happen.
Pudding answered it best. In the private markets people only sell at prices they want to or absolutely have to. If an owner doesn't agree with a valuation and offers on the table, they don't have to sell at all. If an asset is cash flowing, then why bother selling at a massive discount than in 2 years or so when rates come back down and people can get debt cheaper to transact with? The only real reasons to sell would be a capital call too big to manage on a refi coming up or a property hemorrhaging cash and wanting to cut losses asap. People can always negotiate refis with low to no prepayment penalties and refi in 2 years when rates come down or get other creative financing.
Until people HAVE to sell or rates come down, owners are going to be very reluctant to sell at massive discounts to previous years and acquisitions as a whole will remain slow until then.
Funds typically have contingencies built in that can extend the timeframe or can add amendments to agreements to give extra time. No investor is going to want their money thrown at a bad investment simply for the sake of investing, so they will be inclined to work with an operator when times are challenging to find assets to invest in appropriately.
You will also see a lot of syndicators in the middle markets and lower level institutional shops where the there isn't an agreement over the managing agreement for that specific deal. If this is the case, as long as the operator is acting in good faith and the property doesn't default, the LPs are typically locked into that deal until the deal sells or it is recapped.
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