Real estate debt origination out of college
What are everyone’s thoughts on RE debt origination as a first job? Assuming I want to have a career in real estate investing, would this be a better role than REIB or will it pigeonhole me? Thanks
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It will not “pigeonhole” you
Any first job out of college that’s related to real estate is good. If you want to move somewhere else they will probably care more about your level of dedication / drive / interest
I’m an analyst at a large, premiere CRE lender. I would say you get a great overall experience. I would recommend you aim high & try to get into one of the large debt firms. You just see much more volume and learn a ton. Also, since your experience will be eclectic, your exit ops will be great - if you’re into that.
What’s the difference between B/S lending at a life co or a large bank versus debt originations at a private (mostly bridge) lending shop. Have interviews for entry level positions at both. What would day to day look like at each? Which would be a better option in your opinion?
Want to remind you that I only have experience on the bank side. I don’t want to mislead you but I do know folks on the private lending side - which is typically referred to as debt funds. On the bank/life co side, your hours are manageable, pretty good work-life balance, pay is also really good. The deals will be more conservative because of the nature of their business model. Balance sheet is on your books so banks don’t want to throw money at everything/take on excessive risk. The large banks lend from the deposits they receive from customers. Life cos have huge reserves of capital so they are ok with getting back a minimal return if that ensures their investment is safe. They are usually very conservative. They do not want to lose money.
Debt funds are opportunistic lending shops seeking returns that you’d typically see from an equity shop. So this means they chase more complex and riskier deals. They typically pay more, hours are typically longer, but the work is usually intriguing because you see all kinds of deals.
You pick what fits you better. Hope this helps.
Awesome thank you for the insight!
What are some of the larger/more opportunistic shops in debt origination? Thanks in advance!
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