MSRE vs. MBA decision - looking for opinions based on my situation/interests

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Anonymous Monkey

I know the MSRE vs. MBA topic has been discussed here multiple times, and I have read through the old posts. I wanted to share my situation/goals and see if anyone here could shed some light on some of my thoughts.

Me:
- Analyst in acquisitions for a large owner/operator (mid/lower tier PERE 50 firm)
- End goal is NYC development (Macklowe, Silverstein, JDS, Naftali, Extell, RFR, TF Cornerstone, Time Equities, L&L, etc).
- Complete non target school on the east coast and ended up in acquisitions in LA/SF area.
- My thoughts are to work here for a few years, get a masters, then pivot to development

I'm trying to prepare for my eventual masters, and in doing so trying to decide on MSRE vs MBA. Below are my thoughts:

MBA:
- Targeting Wharton or Columbia (largest RE presence)
- From a linkedin search, many people at firms I would like to work at have MBA's from these schools.
- Pros: great network to have, opens many doors, optionality with the MBA. Have fun for two years.
- Cons: Cost (would take on some serious debt, could maybe have ~50k saved by the time I'd go for my MBA), lots of preparation (GMAT, volunteer stuff, etc.), might not be able to even get in to a top school (3.85 gpa, non target), forego two years of FT experience + pay

MSRE:
I already have RE experience. However, a program like NYU Schack appeals to me for a few reasons.
- Very large NYC alumni network (network being a big reason to go for a top MBA as well)
- Can complete full or part time
- Much cheaper than a top MBA
- It would allow me to "rebrand" in a sense, gain access to a great network, and concentrate in development
- Many people at shops I want to work at also went to NYU
- No GMAT required

However, I've heard that the NYU program can be hit or miss, has a very large acceptance rate, and since I'm already in RE, does it make sense?

Random questions/thoughts: Is the MSRE a "cheaper" version of an MBA for real estate? Do people really care about MSRE vs MBA, or is an advanced degree a "check the box" type of thing? Are they respected on a similar level when applying to jobs? What doors would an MBA vs. MSRE open for me after a few years in acquisitions at a relatively large name firm?

As always, its probably more about who you know (network, network, and network some more), but I'd love to hear some comments if anyone here made the same decision

Comments (38)

Aug 4, 2018

Why not do Columbia's MSRE? I've read that it's very heavily development focused and it is a more intensive program meaning most people don't work while they are taking classes.

NYU is better for people with no direct RE experience / NYC based RE professionals who want to continue to work while they earn the degree (based on a reliable source I can't disclose).

But if people at the developers you want to work at went to NYU Schack then maybe none of the above matters. I think you should talk it over with alumni of some of these programs once you start applying.

Edit: re-read your post and I missed some things. I guess completing the program part time was a benefit for you, so maybe that's a reason why Columbia MSRE is out.

From my personal experience, MSREs are not seen in the same light as MBAs, but I've read stories on WSO that say otherwise.

    • 1
Aug 5, 2018

No opportunity to intern, NYU can be done part time/with more internships. However, it is definitely worth considering now that i think about it a little more. I like NYU how you can do Real estate finance and development vs just the development at Columbia too.

Aug 4, 2018

Question for the guys who got masters, did it really help you at all? I dabble in development/capital projects and feel like nothing in a class can really prepare me for the shit I encounter in the field.

Most Helpful
Aug 4, 2018

MBA.

I work for one of the big international developers (Tishman, Hines, etc.) and the vast majority of colleagues at all levels who have masters degrees have MBAs (the firm likes to hire from top-tier programs like HBS, GSB, and Wharton). If you weren't in real estate currently then an MSRED would be useful and practical, but you generally already know the ins and outs of real estate so an MBA will make you well-rounded, you can still take some real estate courses and get an internship with a developer, and it will ideally set you on the path to make it to senior executive positions versus colleagues who don't have masters degrees or just have MSREDs. This is all particularly true if you're targeting big shops in NYC. Obviously an MBA is no golden ticket to get into development, nor is it even required, but if you're seriously considering a masters degree then definitely go the MBA route. I have spoken to many in the industry who have both gotten MSREDs after transitioning from another industry or very different discipline in real estate (i.e. construction) as well as those who were already in real estate and wanted more 'experience.' The general consensus is that a MSRED is helpful if you're coming from a different industry but those who already worked in real estate felt it was kind of a waste of time and that they typically learned more on the job than in the classroom.

Additionally, don't sell yourself short or worry about the stats necessary to get into a good program. Based on your work experience and GPA, as well as your clear goals, if you put the time and effort into studying for the GMAT, doing an extracurricular activity, and continuing to progress at work, you'll have a great shot. You also have the advantage of being young and able to put more time into your work and really put together a great profile for a top-tier MBA.

Anyway, this is just my two cents and based on my personal experiences, but thought I would share nonetheless.

    • 6
Aug 5, 2018

Also I just want to add (going to clarify in my post) - the shops I really want to target are the NYC family office type (if thats the right word)

Macklowe, Silverstein, JDS, Naftali, Extell, RFR, etc.

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Aug 5, 2018

In that case I would actually pursue an MS. If you look at the profiles of people at those less corporate shops you'll see tons of masters and hardly any MBAs. Seems like NYU/Columbia's programs just provide incredible networking opportunities within the NYC real estate community.

I think if you have analyst type experience an MBA will not be too different from in the sense that you will also feel, for the most part, like the classes are not worth the time and money. Nothing in this business replaces flat out deal experience. A degree is really for the branding/networking opportunities, or like the poster above said, if you're not already in the business.

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Aug 7, 2018

Those firms are incredibly difficult to get into and often require a network from within.

That being said, MSRE would probably be best.

Aug 7, 2018

How's the GRE viewed at some of these MBA programs? It sounds to me like some of these top programs don't have a preference about the GRE/MBA, with the rationale that candidates should submit whichever test they performed best on.

Aug 5, 2018

Thanks man, this is super helpful, I really appreciate it! I think you are right - the MBA is probably the best route. The thing that does scare me though is the debt. But hopefully after a few years of working at a big shop I could pay it off fairly quickly.

I kind of agree with the MSRED people who feel its a waste of time. I mean the classroom just doesnt teach you much for real estate if you already have the background

Aug 6, 2018

Interested as well. Anyone have thoughts on Harvard's masters in urban planning/real estate?

    • 1
Aug 6, 2018

Yea, the debt is crazy. Some of the rates for grad student loans are crazy. One of my loans is at 7.5%. Have to pay that one off immediately.

I pursued a top 15 MBA and career switched into Real Estate. However, do you really think you will need to do an MSRE or an MBA if you're already at a top 50 PERE firm? I feel like most graduates of both the MBA or MSRE are filling associate positions post graduation. Don't you think you can get to associate within 2-3 years without the MBA?

If you do think you need an MBA I would definitely focus on Wharton or Columbia as you suggested. If you can't get in to those schools then possibly Columbia MSRE. While Cornell has a strong network I think being in Ithaca vs NYC is a huge disadvantage.

Aug 6, 2018

Well, part of what it comes down to is network. Yes, within 3 or so years I could likely be an associate at my firm or elsewhere. But I feel like I need a bigger and better network, or will eventually. When I want to go do my own deals or move jobs or anything else years down the road, I dont want to be the no-name non target guy.

I have absolutely zero pedigree, which maybe isn't the right reason to pursue a graduate degree, but it is how I feel. I am viewing it more as an entrance fee to a country club. The NYU Program, any top MBA, or columbia's MSRED should without a doubt give me a much larger network and potentially open more doors to jobs down the line.

Additionally, if I were to go do my own thing at some point, wouldn't a degree from atop school help investors/others/etc. feel better about giving me $?

Aug 7, 2018

I'm currently doing the same cost-benefit analysis and am enrolled in schools. I'm coming from a non-traditional real estate background so unfortunately I felt the need to sharpen/obtain the skills I was otherwise not getting on the job. I would have rather not had to pay for it, but we'll see if it pays dividends.

If you never want to do anything other than real estate, MSRE/D. If you think you might want to get into other industries, I've been warned by people in those industries that MBA is the way to go. You can always get the RE concentration like Wharton but $$$. I mentioned this before and forget the specifics but the NYU Schack program is 42 credits at around $73K. The full MBA at Stern is 60 credits but almost double the cost...is that worth it to you?

The class work will never replace the on the job experiences/nuances you learn in the field putting a deal together. However, I don't think anyone would look at you and say "MSRE from NYU? Guy's a slug let's not work with him."

Your best point is the network. I've talked with senior level people from all areas of real estate: MM banking debt, RE BB IB, REPE, developers...they all say NYU is a great program (and others but seems like you're set on NYU).

    • 4
Aug 7, 2018

I'm in agreement. I have (and continue to) give serious consideration to an MBA program for the following two reasons:

  1. Pedigree / Social Signaling - I have enough anecdotal experience that people have a lot fewer questions and a lot more confidence in you if you went to a premier school. I intend to begin to do my own deals in the near future and I believe having that pedigree will provide comfort to potential LPs when it comes time to syndicate equity. I'm not particularly interested in working for a Megafund (which I've done before); however, I wouldn't completely rule out the chance.
  2. Network (from an Investor Perspective) - Again, there are two primary groups of people at M7 business schools: (1) Individuals with serious family money or (2) Individuals who will one day go off to make a serious amount of money. To the extent that a person creates meaningful friendships with either of these groupings, these will provide your initial investor pool (either directly or through their network).

I am already in a role that pays well and gives me a good opportunity to learn and expand my skill set. So for me, if I apply, I will send applications to HBS, GSB, Wharton, MIT, and Columbia. If I get in, I'll do a quick cost-benefit analysis as to whether its worth going.

@cmartin9" - You're thinking about it the right way. If I were you, I would continue to network and take the GMAT. Once you get your score, you'll know where you can get in.

    • 3
Aug 7, 2018

Honestly, as soon as I hear an XYZ program doesn't require GMAT/GRE, I turn away. GMAT/GRE serves as a barrier of entry. You want to make sure your classmates are as competitive as you. Networking/keeping connections with your classmates/alumni is as important as the diploma itself.

Aug 7, 2018

Not really true for masters programs...Georgetown has one of the best MSRE programs in the country and does not require GMAT.

@cmartin9", how long have you been in this business? You are already working in acquisitions in NYC REPE. Don't sell that experience short. My point is, if your end goal is into NYC development, you don't need six figure debt and 2 years of sacrificed work experience to get there. If you present yourself well and are aggressively networking, there is no reason you can't find that opportunity now.

That being said, if you feel strongly you need the grad degree for future pedigree (starting own firm, etc.), or want to work for a firm like Hines which generally only takes MBAs, that is another story. I bring up the point above because I have seen 5-10 colleagues in acquisitions/development who go to get an MBA, and then end up taking the exact same type of job after graduating. Seems somewhat pointless IMO.

Value as a development guy comes from reps and deal level experience, arguably more so than any other RE discipline. Development deal-specific lessons are really hard to teach in a classroom setting. If I was personally hiring a development analyst and looking at a fresh Wharton grad and a guy with a year or two of actual experience, I would take the guy with real reps every time.

    • 4
Aug 7, 2018

Less than one year. I am planning so I have enough time to prepare for whatever I decide. I am on the west coast (LA area).

    • 1
Aug 7, 2018

@cmartin9" I am very much in the same boat as you. I am originally from the northeast and was working in AM for a REIT there but took a job out in California last year to expand a foreign investment fund's U.S. real estate program. I was coming from a RE operational company into a LP RE fund structure which is exactly what I wanted to shift my career towards. Since being out there, with some encouragement from my employer, I have been looking at grad school options. Somewhat limited - USC MBA is good but notoriously...."proud" - i'll keep it at that. Their MSRE program is interesting but full time only. I don't see anything special with USD's MSRE program.

So I soon came to realize that through my grad school research, I really wanted to head back to the NE because I see myself ending up there, the networking, and frankly their are more options for school. Not only that, I love my position that I am currently in, and if you want to do this for a career than NYC makes the most sense.

I did an obsessive amount of research, and what I realized is that I have around 4 years of RE experience under my belt and I plan on staying in RE, so a MSRE just makes sense for me because I will have to take loans out for this and I want to make sure I am getting my moneys worth. I don't want to take any required courses on marketing for $6K a course. I have only applied to NYU's program because I love their options of concentrations and the fact it is part time. Going through their curriculum, their elective's are the most in depth that I have seen. And working for a LP and with major developers and mortgage bankers all over the nation, these courses are seriously tailor-made to give you the right knowledge to advice your career. Not only that, their network is enough for the $80K entrance fee - rather pay that then any country club for networking.

What I have come to get annoyed about, and I am very guilty myself, is that everyone is so concerned on what program will get them into the holy grail of PE/IB/HF. Sure HBS or Wharton will give you a leg up, but you're also going full time and missing 2 years of real world experience. What it comes down to is what you make out of the program. Nothing more. You will have the ability at most programs to learn as much as possible from your courses, classmates, and professors that at the end of the day its what you do with your time. No one will skip over your resume because you only have a MSRE.

Sorry for the rambling.

    • 3
Aug 7, 2018

I think youre right - it is what you make of it. You can cherry pick people from any MBA or MS degree to fit a profile. If you hustle I think you can make any of the above programs work for what you desire.

I have seen people from top MBA's get incredibly average jobs after graduation, and Ive also seen people from top MBAs get amazing jobs. Hard to tell what could happen. I do feel like it would be a bit of a waste for me though. My firm hires associates after their MBA (wharton, columbia, stanford). By the time I am 26 or so I would imagine I could make associate.

I feel like if I went for my MBA I would just be interviewing for associate roles after, not sure there is much point. If I went part time to NYU while working up from analyst -> senior analyst/associate, I wouldnt lose the two years and would be in a great spot when I finish the degree.

What do you mean USC's MBA is Proud? lol

Aug 8, 2018

@JB159" USC's MRED program is available Part-Time FYI.

Aug 9, 2018

bump

Aug 13, 2018

bumper cars

Sep 3, 2018

bump - wondering if anyone has insight into the "raising capital" argument that proponents of the MBA tend to make. I just had this discussion today with some colleagues who went to H/S for their MBA.

The argument is that if you raise your own fund/start your own venture one day, you will have an easier time raising money to invest simply because you have the brand recognition of HBS/Wharton/Columbia/etc attached to your business...thoughts? Personally, I feel like track record & work experience is more valuable but I understand where they are coming from.

Ironically, the few people I know who went off on their own (or plan to) do not really recommend the MBA for people already in real estate.

Sep 4, 2018

I'm thinking through the same things that many of the users on this thread are... there's definitely value to a top MBA network / pedigree, but is it worth two years of tuition and lost income? It's really hard to say, and obviously varies pretty widely. For some people, it makes all of the difference in the world, and for others, they end up at jobs they could have gotten anyways.

One piece of advice I've received is that if you're trying to do your own deals young (early 30s), then it can make a substantial difference (but so could having an extra $250k in the bank so...) . If you plan on doing your own deals in your 40s, then it matters a whole lot less and what you've been doing for the past 10 years matters a whole lot more.

I think you could talk yourself into either answer, and there's no wrong decision. Some people want the two-year MBA experience, other people don't want to leave their friends / families / jobs they enjoy. Some people have an undergraduate degree that provides all of the pedigree they need, or have wealthy family members that can help fund their first deals.

I feel like if you're stuck with indecision here, then go through the process, take the GMAT, apply to the schools, and see what options are even on the table (maybe scholarship money helps you make the decision too). And maybe getting into the school is enough to scratch the pedigree itch - for the rest of your career you could say "I was accepted into XYZ school" even if you choose not to attend.

    • 4
Sep 4, 2018

Think everyone else has said everything that needs to be said here with everything with the exception of the fundraising. In my (limited) experience, on the fundraising side there are really two 'points in time' where it is helpful to have the MBA. The first is when you are initially reaching out to an investor, as this both signals that you are bright/have checked that box and could also get you past the email/phone screen if you happen to be a fellow alum. The second point seems to be when groups are deciding where to actually place capital. What happens with a lot of big investors (think like Pension funds, endownments, etc.) is they have a group of people who run the 'investment' side and they make decisions on who to invest with based on different allocations and return requirements. Then once they've identified that, they will typically either reach out to personal reference points or do some sort of RFP ("we have $x we need to place and our target strategy is y") and then they will probably survey the possible candidates of funds/firms that check all those boxes. In this instance (if there's not a connection made another way), they will survey/research the senior management of the firm and the track records, and obviously look at things like pedigree. But this obviously is a small component of selection since things like track record and references trump educational background, especially in later career stages. Just my $0.02.

    • 4
Sep 4, 2018

You're on fire tonight with great answers.

Sep 4, 2018
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