Hi all,
I am an asset management associate (two years of experience) working at a lower-MM CRE asset manager with exposure to basically all asset classes on both the debt/equity side. Long term I want to (A) go to a great business school in the next 2-3 years or so, (B) work on a firm's investment team helping close transactions. Fortunately, I've done well at my current company, which has offered to relocate me in lieu of me leaving. I'm deciding between three potential jobs and was wondering what the WSO community thinks...
1 Deal team associate at my current firm
2 Deal team / development team associate at my current firm (hybrid investment/development role that focuses only on multifamily assets)
3 Asset management analyst at very reputable firm
1 is very attractive because I can get deal team exposure in many different asset classes, 2 is attractive because I get transaction exposure (though I have to specialize) and get to learn more about the development business, and finally 3 is attractive because - while the function is not what I want - is a top tier firm (think Goldman/MS/Invesco) and the name could really help me get into a good business school.
Thanks for the help.
Id be interested to hear other peoples thoughts on the bschool bit. On the one hand, if you continue with current firm you show progression within your job which business schools love to see. On the other hand you have a blue chip firm which business schools also seem to like. It also sounds like your firm really likes you - any alumni from schools you are interested in at the firm who might be good to use for a recommendation on your bschool apps?
There's also more to bschool apps than your employers prestige. What kind of EC's do you have, GMAT, etc.
I'd probably take the deal team and development hybrid if you like multifamily and see yourself there long term, then the deal team on all asset classes. Also - if you take the asset management role, are you going from associate -> analyst? How many years with current firm? Seems odd to go associate to analyst compared to analyst at firm -> analyst at better firm
First off, thanks for your response I think it was one of the quickest I've ever gotten here lol. To answer your questions:
Yes, I've been pretty successful at work thus far and have expressed interest in changing roles in the past.
Yes, several alumni at my firm who went to NYU/CBS/Harvard/etc.
ECs are fairly strong, I'm a volunteer translator for an international NGO, have past experience and publications in energy public policy, no GMAT yet.
Yeah, it will look like a demotion at the new firm... I've been with my current one for two years.
2 and forget b school. You'll learn more practical knowledge in six weeks at the development shop than you will at business school. And MBA is a great thing to have on a resume, but if you know you want to be in the industry, the deal/development team experience for two years will stand you in far better stead.
Thanks for the response!
I get that CRE is a more relationship-driven business than it is based on your educational pedigree, but doesn’t discarding b school cap your career growth?
do night time MBA or masters in real estate. will pay dividends if you go to large real estate firm but won't do shit at a smaller firm. they will appreciate your work but you won't necessarily see huge dividends.
I think getting a MBA or related grad degree like MSRED is an important credential today. Part time is ok if you have Pre-mba CRE exp. I held out thinking I could just learn on the job; however, my career took an even bigger step up after MBA. It’s even more important for development. Especially associate level and above at top tier dev shops. Particularly those that follow the Trammel Crow model of corporate structure: Higher top MBA, tell MBA to move to new market. Open the new office. Build pipeline. Hire more MBAs. Repeat. MBAs hire others with grad degrees.
Between #1 and #2, I would go with #1. Multi family development has had a great run. It will be the safest development asset class to be in. However, you are what 2 years or so into your career. I’d rather you build a large and diverse (asset class and geography) deal sheet as a member of the deal team. Then get your MBA. Then if you decide, go work as an associate at a top multi family shop. You’ll get to work on deals and the nitty gritty.
Ultimately I want you to be able to analyze and tell me if a deal is worth pursuing. That is what you need to learn now and you do that by working on many transactions, listening to the deal leads, portfolio managers, investment committee, and working on investment thesis creation and due diligence. You’ll only be there for two years or so before grad school so this is the maximization of your learning. You’ll work more than other folks in the office, but you’re a go getter.
It depends what he wants to do. If he wants to stay at his firm or a similar firm for the foreseeable future, then yeah, staying put is the right thing to do. If he's looking to broaden his knowledge base an add a bunch of skills to his resume, then development shop is unquestionably the right decision.
At some point in a career, you have to specialize in something. I guess working on a broad array of deals is good in terms of narrowing down what you want to do, but the skills learned at a dev shop are universally applicable, and honestly, far more valuable than having financed 3 different asset classes in 5 different markets (or whatever). Building office is obviously different than building multifamily residential, but there are basic construction principles that apply to both, and any future employer is going to value that FAR more than a potential hire being able to talk for 15 minutes about the various deals he helped finance in a junior position.
Ozymandia, you have great valid points and working in development after working on a deal team for a REPE was a large learning curve regarding the many aspects of development ("being closer to the dirt"). And I was corrected on this forum and agree with being corrected, it depends that the dev shop underwriting sophistication can be greater or lower than at a REPE. Hard to make a generalization.
I think Development a great place to jump into 2 years after graduating, going the #2 route and working in development for multifamily (hybrid investment/dev). I could see the OP working on JV operating agreements but also underwriting land acquisitions while coordinating with Construction, Entitlements, and Property Management; also working on construction loan financing. Awesome exposure.
Here's my argument for #1, being slightly better than #2 (hopefully this helps folks):
1) Highest & Best Use Using the Widest Lens: Over a decade later since the beginning of my career, I've ventured into a variety of asset classes and looking at various markets. Yes, analyzing land acqs in LA for example, you notice the apartment rents are higher towards the west and north say in Hollywood, hence land price differentials. But what if there is an assemblage and you wanted to understand highest and best use, irregardless of asset class? That's were my diversified deal knowledge comes into benefit. Remember, I feel like the best thing to start honing is Judgement. Development value add is two-fold really. Is the project a good investment and can we mitigate risk. That "15 mins" (more like 20 hours) underwriting and doing your SWOT and deal structuring that crazy ass deal in wherever and the end of the real estate cycle, is going to be part of your mental library for the rest of your career. Development, you are thinking more in the weeds.
2) Job Security: I have majority multi family development experience; however, I once interviewed for a job and the company had an office portfolio that I had to do a case study. Well, I had not used Argus for several years and didn't have it, but I knew enough about underwriting office that I created an excel model from scratch to mimic Argus. Just saying, the longer you stay in this RE business, the higher up you are, the fewer jobs there are available. The air gets thin. I think of a diversified exposure early in one's career as learning some key basics that you never know will help you in the future. Oh that guy/gal doesn't know anything about _____ (multifamily, office, retail, hotel, mezz, etc), well you can say, I certainly do.
3) Post-MBA Avenues to Become a Developer: many development shops will hire a MBA/MSRED grad for an Associate position without actual development experience, that is if the position deals more with capital markets, financing, acquisitions, and dispositions in the beginning, and later introduces you to the more nitty gritty development work (this is the Trammel Crow model, typically - but highly sought jobs after btw).
Other dev shops are very silo'ed and you as a more finance-heavy candidate would be relegated to capital markets and not to the nitty gritty and entitlements. You'll see this especially in REITs (generally speaking), where the complexity of public markets (bond financing, line of credit, some JVs, secondaries equity raise) is silo'd from the development team.
However, if you go to a good MBA and you have REPE experience; the prospects of a 6-figgy Associate position at a Dev Shop with potential to learn all aspects of the business is increased. The other thing is, and we had this scare in California with Prop 10 for multi family (and we are seeing this in Retail development), is Development is very fickle. The old adage of Buy vs Build. We've been spoiled by a tremendous development cycle. Granted populations in the US keep increasing, incomes rising, and the capital flows keep coming. But development needs a confluence of factors to boom. So, just beware. On the other hand, value add opportunities from rehabs, distress, mezz, work-outs; all that might have their time in the sun.
Things are always evolving. Even REPEs are evolving. There are some disintermediation going on (a threat to the traditional allocation model & fee structure of REPE). Stay tuned. But if you are on WSO, you are clearly a step ahead, learning and I applaud that.
Deal or development team no doubt. Just from a sheer interaction standpoint you will learn much much more about finance/business/capital flows/engineering/law/zoning etc. from these two. If you want to do true real estate go development but fair warning I know a few people who always planned on going MBA route then landed a development gig and fell in love.
Like a few others here mentioned MBA is great but only if you're going top 5-10. Other than that if you want to be in real estate the experience of doing deals or being on a development team from age 25 or so on will pay off wayyyy more than some 32 year old MBA whose only real estate experience is from what they read in Linneman's textbook. That being said if you really have your heart set on REPE or fund route yes a top b-school will definitely help you get into the boys club.
Sounds like you're getting your feet wet and doing your research but just get busy. I've learned way more from my mistakes young in real estate than I ever learned in class. Talk to any senior guy and it's more of the same. Enjoy the ride man.
My two cents is don't take a job for the perceived impact that it gives your MBA profile. MBA admissions is a total black box, and you don't know if they would rather see you take an "analyst" title at a big RE firm or continue to advance at your current company. Probably varies by school and even by admission team member.
Btw, you could do everything "right" and still not get into your dream b school - look at some of the profiles in the poets and quants ding reports.
Take the job you're most excited about (which means you should naturally work harder at and do better at) and that you're going to learn the most at. At the job, sure, make sure to work for smart people with top MBAs who can write your rec letters.
Also, gotta crush the GMAT dawg.
Quia ipsa voluptatibus in tempore. Nisi non quasi non. Dolorem sequi qui non magni nemo quis eligendi.
Saepe mollitia cupiditate qui quia doloremque. Voluptas sit possimus in laborum. Et eos at sit et. Voluptatem et blanditiis magnam voluptas sint sed similique.
Omnis maxime asperiores reprehenderit sequi quibusdam. Ipsum dignissimos dolorem est. Et consequatur voluptas placeat mollitia esse ipsam ut.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...