Best high-paying career if I want to start my own multi-family commercial business in 6-8 years?
Hi - I'm and undergrad operating under the assumption that if I want to be a professional investor full time and grow a multi-family commercial real estate investment business, I should start out my career at a top real estate investment firm because I'd be able to practice underwriting, due diligence, etc. I'm really not keen on being a broker or appraiser.
What path would you go if you could go back in time to set yourself up to be the best real estate investor in 5-8 years?
Hey acuriousbeing, what a lonely thread. I'm here since nobody responded ...so maybe one of these discussions will help:
Hope that helps.
middle marker brokerasge is a good place, anything with finance. THEN move to the buyside and get experience with asset management/acquisitions
This is the best real advice. Young guys can make a killing at middle market brokerages in the top 20-30 largest/growing metros and then plow that money into side deals. Most of my firm focuses on middle market multifamily investment sales and make a very healthy income ($250k+) within 2-3 years in the business. Being middle market allows younger folks to get into a production role much quicker than the big shops, and make much more money quicker. It's not super glamorous, but will be the best chance for to get you to your goal by age 30. You just have to be willing to hustle and work extremely hard.
Also, underwriting 300+ unit apartment buildings will hardly give you the practical experience you need. You won't start out buying a 300-unit building, and likely won't even be able to buy a 30-unit building, so you need to understand the small world to be effective. Buying and managing small multi-family properties are very different than large apartment buildings. You have different operation plans, financiers, management issues, etc than large buildings, and getting practical experience working in the middle market space will give you the experience necessary to soundly invest and grow your portfolio.
can I get more information on this? What sort of firms are you referring to?
It depends on the market, there are the big name firms that have dedicated middle market investment sales and debt brokerage, and also boutique firms who kill it in those markets
What's your trust fund situation? If it's not strong, marry a single child with wealthy parents that are either sick or live a high-risk lifestyle.
This isn't even funny. This is basically 1000% correct. I know a lot of people in real estate, and the only "self-made" person I know of the last decade inherited a fat amount of money from his parents to begin investing. Now, these beneficiaries should be praised for not just doing drugs and pissing away their inheritances, so it's no criticism of the kids. But yes, that is really the only way to do it in today's environment.
The other guy I know who is sort of "out of the ashes" married into wealth and, again, to his credit, continued to labor, but he's certainly not traditionally self-made.
It's the timeline that kills me. I have full confidence that at some age, I'll be on my own. The idea that it'll be in my 30s is comical though.
There is a great scene at the end of Limitless, where DeNiro's character says:
Carl Van Loon: You haven't had to climb up all the greasy little rungs. You haven't been bored blind at the fundraisers. You haven't done the time in that first marriage to the girl with the right father. You think you can leap over all in a single bound.
He is absolutely correct,
The real answer. I too am looking for that career that will make me independently wealthy at 30
With that timeline, Multi-family investment sales where you are put into the role of producer right of college (i.e. no salary). If you are successful (not easy), you might be at an income level at the time line where you can plow some back into deals. Other than that, not many 27-30 year olds with enough cash saved up to do their own thing (unless they come or marry into money as mentioned above).
I know you said you're not interested but i think appraisal is a great way to go for three reasons. 1. pay, you can make $100,000-$150,000 within a 2-4 years out of college. 2. underwriting experience. You'll write 4-8 appraisal reports a month and get exposure to all property types including MF. 3. Flexibility, you can work as much or as little as you want and you can start buying small RE deals while you still have health insurance.
Now to start your own shop you'll have to start small unless you come from money. Buy a few smaller deals while your're working to build a track record that you can sell to friends and family. Hopefully you can build an investor base that can support larger deals in 10-15 years. My guess is it'll take longer, closer to 20 years before you can start your own shop and live off the deal flow/income, unless you find a big pocket investor early on.
Compete for the ~1-3 FO spot per year per MF REPE firm and clear 150K+ your first year out of college. Stay, and excel, there for 7+ years and never live beyond half of your means (you can put away 50-70k in savings your first year after bonus if you're frugal). At the end of that grueling, depressing, self-depraving tunnel of 60-80/hr work weeks, self-loathing, and questioning/rationalizing your worth to society, you'll have a nest egg of close to $1M - $2M depending how early you hit carry at VP. Put your money where your mouth is and invest almost everything you own into your first deal. Things will go undoubtedly go wrong, but you will ultimately live through it, successful or not. Either way, you will likely have a safety net of a cushy private equity job to go back to if things don't work out.
Or you will realize that you're not cut from the same fabric as the rainmakers who pull in the fat stacks, and ultimately end up working for a smaller shop. Potentially making more, probably making less, but either way if you are driven by a passion other than amassing pure material wealth, I'm sure you'll figure out a way. Otherwise, you won't make it very far in this industry.
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