How to successfully transit from Asset Management to Acquisition within the firm (REPE)

Miaospirit's picture
Rank: Monkey | banana points 38

Hi Everyone,

I will start my first day in a small multifamily REPE firm (Current AUM $300M) in two weeks. My position is Financial Analyst/Junior Asset Manager and during the interview they had expressed the possibility to go to Acquisition side if I do well (They currently have a senior associate who is doing the acquisition work and would like to have somebody within the firm to work with him when the portfolio is big enough. My job content would be 25% support Investment Team and 75% support Asset Management Team.

Some backgrounds about me: Total 3 years underwriting/modeling experiences for Multifamily Developer and Commercial Brokerage. Bachelor in Accounting/Master in Finance, sitting for CFA level 2 exam in June.

Since I've never done asset management, my question is how can I do well? To be more specific, for you guys who have experience in asset management, what would you wish to know when it was your first day? Is there anything I should build up from day 1 so I benefit it in the long term? For guys who have experience in both Acquisition and Asset Management, what are the transferable skills and what other skills/advises should I know that would help me to make the jump easier.

Any comments/advises are welcome. I really appreciate your time.

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Comments (2)

Most Helpful
Mar 8, 2019

I'm now in soley acq. but had a cup of coffee in a generalist role.

Asset mgmt advice:
- understand the firm's investment / asset management philosophy to best align proposed business plans with firm's preferences / goals. ie; gauge appetite for risk, appetite for capital investment, etc...
- understand the assets and its competitors. This is hugely important. If an asset isn't performing well and some of it's peers are then take a deeper dive into what's going on. Flipping the coin, if an asset is outperforming its peers then what are some qualities that you can replicate for future assignments?
- be flexible. The initial business plan devised by the acq team may have been great at the time, but not anymore. No one will get offended if you suggest a pivot that is well researched.
- sometimes you just have to let an asset go. They aren't all winners. Holding a shitty deal with grandiose aspirations for the outcome is not a good strategy.
- always think about timing. Value-add plans take time. if you're pivoting half way through the investment life, is it worth it? How does it affect the potential promote? May be worth it to give up if it benefits your iRR clock.

Transferable skills:
- executing business plans teaches you which business plans work and more importantly which business plans don't work
- executing business plans teaches you how much it costs to complete them. Acq guys are uncanny when it comes to low costs to complete a plan. Being able to spit out strong initial cost estimates is a great quality.
- better understand / measure assumptions related to leasing.

Let me know if you have any other specific questions. There are more but I have to run.

    • 5
Mar 8, 2019