Leveraged Breakdowns

Boring Candidates Get Cut: How to Grab Attention when Networking into Real Estate Private Equity

If you want a career in a real estate private equity firm, you aren’t alone. Any single job opening attracts fierce competition. Thus, to get a career in real estate private equity, you need to stand out from the crowd. Generic candidates don’t get hired. Unfortunately, many candidates struggle to set themselves apart.

As a mentor and interviewer, I have spotted several obvious trends that set the most successful candidates apart from their lackluster peers. This post distills my years of insider experience into a set of best practices for anybody angling for a career in a real estate private equity firm. First, a couple notes on what you might be doing wrong.

Technical skills are a basic requirement, not a unique attribute

Learning technical skills is easy — all you need to do is sign up for my course and commit a few weekends to self study. Yes, technical skill is necessary to get a career in a real estate private equity firm. But also, you’ll never get hired solely for your technical merit. When interviewing for a career in real estate private equity, your goal is to capture attention and get hired.

Too many candidates focus only on developing their technical skills and forget to make themselves interesting. I like to say that funds hiring for careers in real estate private equity appreciate technical skills as much as basic math skills. Put differently, nobody’s going to hire you for saying that 2 + 2 = 4. Yet if you say 2 + 2 = 5, or can’t build an LBO model, you definitely won’t get a career in any real estate private equity firm.

Boring candidates get cut. Generic candidates are boring.

I have seen too many qualified candidates get nixed from our interview process because they spark no interest. Even if they nail the LBO round, generic candidates fall flat in the final stage. If you’re unfamiliar with the various stages of the interview process for a career in real estate private equity, check out this detailed blog post. The next few sections explain how you can stand apart from your broadly generic competition with just a few specific interests.

Understand the Fund’s Strategic View

Each fund has its own strategic view. For example, the legendary investor Sam Zell has done nothing but sell assets over the past five years, hedging against an impending real estate bubble. Singapore’s GIC and Canada’s CPPIB have been hungrily snapping up student housing to benefit from the sector’s alleged counter-cyclicality. Brookfield has bet $15B that luxury malls are undervalued and will surge as the economy continues to perform. Blackstone continues to bid aggressively for hotel portfolios.

How would you expect the narrative of an interview at Sam Zell’s Equity Group to compare against one at Blackstone? Why? How would you prepare differently for an investments pitch at GIC vs. pitching Brookfield? What other sectors are the majors playing in, and what’s your personal opinion?

It is easy to understand a firm’s investment thesis if you follow the money. The data is abundant, yet only you can connect the dots. You need to understand strategy if you wish to embark on a career at any particular real estate private equity firm.

Ask Specific Questions when Networking and Interviewing

Each question you ask while networking or interviewing is an opportunity to set yourself apart. If you ask the same questions as everybody else, you’ll seem like everybody else. To land a career in real estate private equity, you will need to capture attention with specificity.

Below is a list of generic questions that I get asked all the time. These are great questions to ask, but they are not memorable. When reading the questions below, imagine how you might reconfigure them to be more specific to the strategic view of any of the funds mentioned earlier in this post.

  1. What is an interesting transaction you’ve recently worked on?
  2. What is a typical day in the life like?
  3. What is your view on [sector]?

Use the Generic Questions Above as a Framework to Develop Specific Questions

The caveat I want to make here is that these generic questions above are actually decent frameworks. Frameworks are meant to be workshopped into better questions, not parroted word-for-word. Do not ask these questions verbatim — that’s generic and boring.

Instead of asking the generic questions above point-blank, do your research and dive into the details. Tailor these questions to probe the specifics of your interviewer’s particular career in their particular real estate private equity fund. Below are a few examples that properly employ each generic framework to develop a tailored question that stands out.

  1. I read that your team recently invested $200M in a manufactured housing portfolio. What elements of that sector drew your firm into the investment?
  2. Your CEO recently mentioned that industrial real estate valuations are reaching a mature stage. How does this impact your near-term disposition strategy of your Midwestern industrial portfolio?
  3. Earlier in our conversation, you mentioned that you were involved in the acquisition of a public diversified REIT. How did your daily responsibilities evolve as a result of that experience?
  4. I noticed your fund has recently begun disposing its retail assets. What near-term market catalysts are most pertinent to your fund as you execute this strategy?

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