Trying to map out a real estate private equity career path may seem daunting if you don’t know where to begin. Whether you are fresh out of college or have 15 years’ experience, there are a variety of opportunities awaiting if you know what to look for. Here are five career paths that will help you search for that perfect job.
Performing investment property analysis is a critical role in the investment process, and it serves as a training ground for advancement in your career. Analysts will build pro formas (a financial model that projects the profitability and investment returns that an investment should generate), perform due diligence, create market studies, verify in-place rents and lease-up assumptions within the marketplace. The real estate private equity model that is generated serves as the foundation for the investment manager or investment committee’s decision to acquire a property.
Larger firms will often employ portfolio managers who oversee a number of investment properties. Often, portfolios are divided by geography, asset class (e.g., multifamily, industrial, retail, etc.), or both. Responsibilities may include monitoring financial performance and comparing to budget, staying abreast of market trends that may affect the portfolio in the future, refinancing loans that are maturing, and reporting performance to groups such as management, investment committee, and investors. Portfolio managers may also be responsible for compliance with company or regulatory policies.
A property manager is responsible for the day-to-day management of an asset, whether it be a single office building, a complex of apartment buildings, or an industrial park with a host of individual properties. Property managers oversee and authorize repair and maintenance activity, leasing of vacant space, marketing, rent collection, and capital improvement projects.
Real estate projects generate significant accounting activity and there are a host of jobs that account for the flow of money. Rents and expense reimbursements from tenants, expenses such as property taxes, repairs and maintenance, utilities, commissions, and insurance, and capital events (acquisition, disposition, refinance, investor distributions) must all be entered into accounting software, reconciled, and reported.
Careers in investment sales may involve obtaining a real estate brokerage license. Duties involve scouring the marketplace for listings (services like Co-Star, Xceligent, and so on), networking with listing brokers around the country, and negotiating purchase and sale agreements. Traveling to inspect a potential acquisition is common, ensuring that someone on the investment team has personally inspected the property and toured the market to assess the overall viability of the investment. Depending on the size of the firm, asset disposition may also fall under this description.
There are a variety of entry points to a career in real estate private equity, depending on your educational background and work experience as well as your personality and interests. Many jobs will require the ability to create and understand a real estate private equity model, but there are options that focus more on property operations and accounting. Depending on the size of the firm, you may even have the opportunity to work in more than one area.