Best roles if you want to learn to be an owner?
Anonymous to protect current role.
I'm currently a newish broker. I see brokerage as a great way to earn decent income down the road and I like it because it allows me freedom to be an owner on the side which is my long-term goal. I am considering pausing my current role and going to work for an owner for few years while I still have the freedom to work cheap and scrape by if necessary. I know ownership roles are coveted and difficult to get, I plan to target smaller shops and am willing to live wherever is necessary.
My ideal goal is to work for 1-3 years, learn as much as possible, and then return to brokerage in my current city and begin investing my earnings into my own projects. I know the most important aspect is eventually having access to capital. I plan to start with approximately 200-250k of my own cash and another 200-250k from two contacts for total equity of 400-500k. Not huge but enough to leverage into a decent acquisition in my low COL city and I am willing to start small. I am most interested in building a meaningful and stable net worth and understand that I will need to be realistic with my goals since I don't have major existing capital sources.
Ideal job is with a lean shop where I can work somewhat as a generalist but I am also looking at more specific roles in case I can't land one of these.
What specific roles might be the most beneficial? Are there any that I should avoid? I've looked at acquisitions, AM, leasing, and lease administration. I know I would learn in each of these but which would be the most transferable to my own projects down the road as an owner/GP?
Thanks!
Depends on the asset class. If you are focused on retail I would say Leasing and AM. If it's MF I would say acquisitions and AM. You'll need to know how to underwrite a deal and implement your business plan.
Thanks for the reply. This is about what I thought.
Possibly a dumb question but: If I were to work AM at a shop that owned retail and MF, would I be exposed to both or are there usually seperate managers for each asset type? I'm sure it depends on the firm size and structure but I am curious in general what might be typical in that case. Thanks!
I think you're on the money here with your assumption. At larger firms with higher AUM, you'll likely be silo'd to MF or Retail. At a smaller firm, which will likely have smaller properties, you may have some crossover. The exception here may be with Mixed Use, but those can be a bit more complex and sometimes handled by more senior asset managers. This of course is just my experience with some firms and clients we work with so take my comment with a grain of salt.
Construction Management
I am so sick and tired of this trope. I can buy that it is a good background for somebody looking to get into development, but for syndicating multifamily and strip center deals? Fuck outta here.
I agree with this dude, sorry you got MS, if the idea is to start with 500K in equity I'd rather have someone who knows the stick and bricks of RE manage that real estate rather than some finance dude.
I mean this is a ridiculous question but taken seriously "what should you know if you want to own your own personal small RE portfolio?" I'd put money on a former PM or construction guy before finance or asset managers.
Interesting perspective. Construction management would be a stretch with my background and my focus would be on acquiring existing assets with minimal rehab requirements. In the event I was on a deal with heavy redevelopment, I would probably only take it on if I had a partner with that background. I appreciate the emphasis on understanding PM & CM though as an owner and will do what I can to learn about those parts of the business on my own and when I have opportunities to meet people from those areas. Thanks
In my experience, the people with the deepest, most applicable knowledge are property managers. Not sexy, but a good one will be well-versed in handling everything from legal / compliance, to vendor relationships, to budgeting, etc.
Like maineiac42 said, asset class matters, but my $0.02 is that across all classes brokerage + prop mgmt experience is all you need.
Interested to hear other takes.
I agree. PM gets beat up on this site since it's not prestigious but a lot of our clients are Property Managers who went off to start their own firms and have pretty sizeable networths since they know the markets so well and often get first look at assets. They also get paid pretty well because PM firms can run pretty lean once they are systematized.
Makes sense since they are on the ground and likely understand the asset more than anyone. I should have mentioned that I was an on-site manager at a 50 unit complex in my college town while I was in undergrad. Certainly not an expert but I think this gave me an understanding and an appreciation of the importance of good management. As a result, I'll likely just outsource PM down the road unless I go full time and want to start a management company also (which I have considered down the road) Since I've worked as a PM I think have enough familiarity to manage a 3rd party provider. Hoping to work in a different area that I haven't had exposure to. I have a relative confidence in my ability to value and manage a property, I don't really know how to manage and pitch the actual investment. I'm sure I'd be fine on a smaller deal but eventually I hope to work on bigger projects and am hoping a year or two working for someone else will provide confidence on that side of the coin. Leaning toward AM or Acquisitions in MF. Thanks for your input, much appreciated.
If you want to be a developer, might I suggest working for a developer?
I do not want to be a developer, that is outside my interest and well outside my limited expertise. My interest is on buying existing assets with minimal rehab requirements. I'd love to have a great developer as a partner if I had a project that needed one but that is too complex of a process for me to undertake on my own and I don't have the passion or interest necessary to put in the time or work to fully understand that world. I want to work as a broker and build up a meaningful portfolio on the side and also want to have the knowledge and experience necessary to target larger assets and confidently manage investor capital if I take on a partner or two down the road.
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