Tips for transitioning to Development Manager roles?
Hey All,
I got my MBA with a concentration in Real Estate (mostly focused on RE Finance, branding, and development) a few years ago but after graduation found it difficult to transition into a development role. I went for analyst jobs at RED firms, but many wouldn't hire me because they said I was overqualified for the role and only offered 40-50K, but they said I needed 1-2 years of working on an actual development to be considered for RED manager roles.
Fast forward 4 years, one of the firms that I started networking with after graduation reached out about open positions, and they have a RED manager role open. Although I still don't have any ground up development experience, I definitely have related experience working in asset management/property management for the past several years:
-Selecting, managing, and working with contractors
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Due diligence /working with city offices
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Working cross functionally to reach a common goal
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Managing timelines and holding people accountable
In business school I worked on mock consulting projects building out full project scopes, underwriting, and design for companies like Hines. This firm I am talking to is small/medium size, so there would be a lot of opportunities for exposure and learning really fast.
What tips do you have, especially for you development managers out there, for putting my best foot forward and really advocating for myself as I prepare for my interview this week? The whole reason I went to b-school was to use it as a stepping stone for RED, so I really want to make the most of this opportunity.
I’ll bite, I’ve been a DM at a regional MF firm for several years now.
I would do your best to understand what elements of the development process a DM at the company handles so you can cater your experience/pitch to them. There is a surprisingly large variety of stages you might be handling depending on the firm. Traditionally for larger companies DMs step in after acquisition and drop off in the construction stage so you handle more of the “front end” of the job. Medium to small size companies you will likely wear more hats which could include finding new land, acquisition, marketing/leasing, etc.
One item I would forewarn you on however is that you may be in for a bit of an uphill climb as property management experience is not viewed as favorably as other subsets so what I would emphasize given the background you laid out is that your more detailed property management gives you a better, in depth knowledge on how to actually run properties. This will help your acquisitions/underwriting stage as you’ll better understand operating assumptions, the marketing/leasing as you’ll know what is worth spending money on, the financing stage as you’ll have experience pulling down and organizing property level data, etc. A smart developer understands that this is an execution business and pointing to a strong track record of getting things done should appeal to most.
Outside of that I would recommend knowing Excel well enough to build a full financial model from scratch. This isn’t necessarily required as a DM is above an associate and analyst role but better safe than sorry as this is an easy ding.
I would also recommend having a good understanding and opinion on their key markets, recent projects, investment strategy and product type. I would also do your best to get visibility on their funding sources/liquidity on hand as this will play heavily into your job security depending on macroeconomic conditions.
Thanks for the feedback. I have a great rapport with the person I interviewed with, but they are an architect by trade and they don't like doing the numbers part, so it looks like they want more of an underwriter with at least 2 years of hands on development experience. I have purchased a couple of financial modeling courses from Udemy. I could do modeling in my sleep in grad school but since I haven't done it in several years, I need a refresher. After completing it, I'll reach back out to them and offer to take an excel test to prove that I am able to perform the work they want me to do.
CRE
Thanks, man
So, I'll offer some perspective.
First, job titles/ranks at development firms can be very 'all over the place'. So a "development manager" at one place could be a "vice president" at another or even a "senior associate", yet all essentially the same general level of responsibilities and duties (and probably pay relative to other factors). Thus, I'd ignore title fixation in this industry (really all of CRE, but especially development). Side note on that, in brokerage/banking, VP is generally mid-level (first tier producer rank), but in many development firms (like mine) VP is senior to low-executive (like a VP at my firm has 15+ yrs and is in their 40s average at time of hire/promotion). Development Manager or project manger, etc, is generally "mid-level" in my book (and my firm).
So.... since you are seeking your first role in development, aiming for a mid-level title may not be the easiest. If your asset/prop mngt experience seems relatable (and you have an MBA) you may get it, but I tell you it would be very difficult at many large-scale, institutional developers. At regional/small scale shops, sure (but titles can be meaningless there in general). So, at my firm, and many devcos, I think your general profile, years of exp, etc. would make you a candidate for Development Associate. That is where I would target the job search if I were you (at least with respect to larger type devcos).
As for the current opportunity, just be on your best and be flexible. If they like you, they like you!
Thank you for the insightful reply. They do like me, but definitely want someone with more hands on development experience and underwriting skills. They said that they wouldn't put me in an Associate role, because their associates don't do anything earth shattering and I'd likely be bored. I offered that as an avenue to at least start the clock running with some hands on experience, but the weren't really sold. I am brushing up on my pro forma and lease analysis models right now though so I do plan on circling back in a few weeks and offering to take an excel/skills test to keep me in the running.
I would worry a bit less about excel skills and a bit more about the development process. With your MBA and asset management experience, you can probably already do 95% of the math required.
You're in a bit of a tricky situation where you probably would be bored doing associate level work, and although you personally might be fine using that as a learning opportunity, the company is right to worry about you being a flight risk. At the same time, since you literally have never been through the entitlement, design, construction, lease up, and disposition processes, you also have a ceiling to how much responsibility they can give you.
Ultimately, this may not be the right company for you to transition to development with if they can't envision a specific mid-level role for you that would allow you an interesting enough role while also giving you room to learn and experience the things you need to. Luckily, all is not lost, as real estate company are run and structured a million different ways, and chances are someone else out there will see an opportunity where this company does not.
Expand your search.
@CRE is giving really solid points on this one! I'll agree that this may not be the place. Truthfully, your first job in development has to be at a place that is willing to work with your strengths and weaknesses, and frankly, not all will. There is a very definite bias for hiring people with development experience at all levels above the most base level at a lot of devcos (I would this seems to be case at my firm tbh). Still, exceptions get made when the person makes sense (and I think of examples at my own firm that fit this as well). So I think your options are 1. Find firm that will allow you in at the base level (not care if you get "bored" or not, which seems like an odd issue tbh) or 2. Find a firm that will take you at more senior level (equal to current yrs/rank) and allow you to bridge the gap with time. To be blunt, I'd think option 1 is easier (so long as you are communicating that you are so willing....) than option 2, but really it's all between you and them.
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