AMA: Real Estate Acquisitions Analyst. Uni -> BO -> Mtg Financing -> Acquisitions

KClubs's picture
Rank: Senior Baboon | 183

Graduated 2017. Had opportunities in consulting, commercial banking, and real estate. Gambled on real estate route by starting in back office role. After ~2.5 months in BO, transitioned to more "front office" analyst role. Did that for ~18 months before a recruiter got in touch and recently (less than 6 mo) made the switch to a solid developer.

AMA

Comments (23)

Mar 4, 2019

Thanks for doing an AMA. How did you make the jump from BO so quickly? What type of role was your front office role?

Mar 5, 2019
  1. In short, did good work and asked to move. BO role was internship/co-op over the summer (May-August). By mid-July I had finished all of the work that I was given so after that I went about asking for more work / side-projects that I could help folks out with. I met with senior managers in both BO & FO about future opportunities and roles. The FO analyst team got slammed towards the end of August so the company realized that I was basically twiddling my thumbs in BO, and they put me to work with the FO guys. After the crazy period ended, I was offered the chance to stick around and prove myself.
  2. Real Estate Analyst is the title. Role consisted of underwriting/analyzing commercial real estate. I would be the bridge between our brokers and our investors, doing my best to provide the investor(s) with solely the facts, as apart from regurgitating the broker's sales pitch (read: bullshit). Tasks: underwriting & sizing deals, managing/doing all credit/risk work, and writing the legal commitment letter.
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Mar 5, 2019

Honestly there's a key difference between front office and underwriting analyst....
Usually they only call the production analyst/producer as front officer

Mar 5, 2019

Thanks for doing this. So do you think doing CRE underwriting at a commercial bank is a good start to landing an acquisitions role down the road? Any chance at REPE in the future too?

Mar 5, 2019
  1. I sort of have to agree that it is a good start because that's roughly what I did. Granted, I believe there are a host of avenues that someone can take to lead them into an acquisitions role. Equalizing for quality of institution, I'd be inclined to say that an analyst role at a commercial bank is a solid place to start (hypothetically out of university). ...as long as you keep in mind that the acquisitions language and mindset is significantly different.

Underwriting consists (at least it did for me) in a very conservative, fact-based approach. This is what the situation is, here are the facts, and let me explain what is good and bad. Your duty is to the investor, not the borrower.

In acquisitions, you're trying to make a more nuanced argument to say how you are anticipating intangibles (ie. per buildable figures across markets/cities as function of labour supply/demand in construction). By the time you get to the financing/lending, most of that has been hashed out. I would think that this is why more people would talk about a "feel" for the market in acquisitions/development. Alternatively, you could look at how pricing on loans works. It isn't a hard science. The difficulty is in trying to quantify intangible and irregular data/inputs (eg. new mayor doesn't publicly support concrete-built high rise. do we switch development plans or move forward?).

To tie it back to the commercial bank question, you may find that work at a bank is rigid and inflexible relative to your typical acquisition/development gig.

  1. It is on the radar but I'm young and real estate is filled with old people and old money. I need to make my bones first doing good work, and improve my knowledge base. REPE could be a nice gig once I enter my late-20s / early-30s.
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Mar 5, 2019

What's your comp (salary / bonus) and benefits? Hours worked?

Mar 5, 2019

Note: NA - west coast

75 + 15%. Benefits are typical (phone, transit, gym, average medical/dental)
eh, depends on deal flow. I'm in the office 8-6 (50/wk) but rarely am going full-tilt the whole time.

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Mar 5, 2019

Random question for ya.

What is your opinion on doing underwriting (analyst) at a life co like MetLife, Allianz, Prudential, etc. Do you think this opp would lead to success in interviewing for acquisition type roles after 2-3 years in underwriting?

I understand if you don't have a perfect answer as we are the same age, but seeing as you made the jump from u/w analyst to acquisitions, I am curious.

Thanks man

Mar 5, 2019

It's 10x better than doing investor relations for Goldman

Mar 5, 2019

What the hell is investor relations in real estate

Mar 5, 2019

Haha yeah, I think I'm going to write off that position at GS. Thanks for the advice in my thread too

Mar 5, 2019

I don't see why not, it sounds like a pretty decent job. I don't know have too much exposure/network with folks from life co's but it isn't too hard to rationalize the gig.

Lots of in-house money and long time horizon means great rates --> top quality products.
Considering rarity of top quality products --> less deal flow than a shop with more diverse offerings or investment mandates. (less deal flow --> maybe less stress?)
Big and/or slow moving company --> less room for advancement.

What is probably more important than the specific "role" is what you learn while you are there. Working at Allianz may help you get an interview for an acquisitions role, but doing well in the interview will depend on your understanding of real estate.

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Mar 4, 2019

Follow up question... What is your opinion on becoming an underwriting analyst at somewhere besides a life co? Do you think that experience as an uw analyst can be parlayed in to a more financial focused role? Such as capital markets/ Debt and structured finance/ Broker team role?

What about a development analyst role?

Mar 5, 2019
  1. A bit open-ended question. I think it's alright. Better than being unemployed.
  2. Yes
  3. For sure. If you actually learnt something in the underwriting gig then you can provide a different perspective on deals/transactions. Capital markets teams from investors at my old job recruited from and were in contact with the analyst pool at my company.
  4. Broker team could be a bit more difficult to crack as they are heavily relationship based and from their perspective, you have had your face buried in Excel for X number of years. You'd have to prove you have an ability to sell.

To be honest, I'm a bit inexperienced to be offering good insight on these questions. I am in the camp that high performance is translatable. So if you impress in a role X and apply for role Y, it isn't too difficult to explain in your interview something to the effect of,

"I was interested in X and performed at a high level but have since become more interested in Y for these reasons blahblahblah. I think my proven track record in X shows that I will quickly become a key member of the Y team. I have these directly transferable skills blahblahblah."

Granted that doesn't mean you can go from being a great plumber to a great rocket scientist, but making the transition from a financial analyst that looks at assets from 1 perspective vs. the opposite side of the transaction doesn't appear to be a huge deal to me. If you can reduce the number of reasons for an employer to not want you, you've won most of the battle.

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Mar 19, 2019

How easy or difficult do you think it would be to transfer from commercial banking (underwriting) to real estate acquisitions? Have you seen anyone do this?

I had similar options to you coming out of undergrad and I chose to go the safer CB route and now I want to switch over to real estate. I would say about 50% of the deals I work on right now are real estate deals so I'm hoping potential employers will value my current experience. Also, my undergrad degree is in real estate finance so hopefully that will help.

Mar 5, 2019
  1. How easy/difficult the transition would be would, I think, likely depend on the strength, quality, and quantity of real estate acquisitions job opportunities where you are living. In terms of skillset, I think it could be difficult to explain not only your desire to make the switch, but explaining to your new employer why you have a mindset/mentality that fits with acquisitions. Ultimately you are moving from a conservative/debt approach to a more bullish/equity approach. Whether you can articulate your ability to make a seamless transition is up to you.
  2. Not personally. Most people I know who work at banks do so for a specific reason. Security, benefits, job ladder, etc.

Good luck

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Mar 19, 2019
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