Is it impossible to recruit for general PE from BB REGAL group?
Currently in BB REGAL group and wanted to know how hard it would be to recruit for general PE. Any insights would be appreciated
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It'll be rough given you won't know modeling/valuation outside of REGAL industry. Plus headhunters / firms immediately seeing you as the real estate guy. You'll have a good chance at REPE though!
Depends. GS and Deutsche REGL are extremely strong and place well even in corporate PE. You should look at exits from your group and have candid conversations with recruiters.
Yes but you are fighting an upwards fight. The reason being that corporate PE is corporate which is an operating company with different cost structures and revenue builds. Real estate is asset level for the most part, uses NOI or AFFO instead of EBITDA in some cases, and has a very straight forward revenue build and structure. You miss the complexity in product mix and balance sheet nuances while focusing on your operational KPIs (ADR, occupancy, revpar).
my point is you’ve got to convince a corporate PE fund why you want corporates instead of going to real estate at a megafund like blackstone/kkr/oaktree or a real estate hedge fund. The corporates will take an industrials, c/r, tmt person more instinctively because the modeling focus is also greater in those groups compared to asset level KPIs for real estate.
Yes, the transition is difficult to corporate PE but not for ALL the reasons the above user mentioned. A couple of my friends have moved from BB (DB/UBS/JPM) REGL to Traditional and Distressed Corp PE
Hotels have multiple products (room types, weekday/weekend rates) and pricing (transient/business) soo it is very similar to product/price mix of a operating company. Think of few other ways and convey this in your story, practice few LBO’s and network hard.
Additionally if you think abt it, unlike office/multifamily, hotels are actually selling a product (rooms/suites) on a daily basis just like a regular widget company so its probably the only RE property type that comes close to an operating widget producing company.
If someone is working at a BB, they are likely working on M&A operating company deals where one company is acquiring an interest in another real estate company .. e.g. Advising a REPE firm on acquisition of another operator. This is very similar to working in a traditional coverage group. Yes, metrics are different but transition to traditional PE is not that hard. I havent ever heard of a BB doing an Asset Level deal. Most of the Asset Level deals experience one gets is at a sellside Brokerage or buyside REIT or REPE... This Asset Level/OpCo Level experience also plays an important role in recruiting and this is why you see Carlyle hiring mostly from REPE/REITS/Owner Operators vs KSL/Rockpoint hiring those with banking background.
Sorry for typo/grammar.. typing from cellphone, 2:20 am in the office. OP, PM me if you need more info.
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