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Opposed to investment banking and consulting, where undergraduates compete for the few summer positions at the top BB / MBB firms, real estate private equity has numerous more inroads.
IB / Consulting have one consensus path to follow — REPE does not. Don’t let this confuse you! It’s actually great optionality.
On the IB/Consulting side, the limited options removes the paralysis of choice. Their peers’ conformity to a narrow band of best options (Goldman, JPM, MS, McKinsey, Bain, etc.) allows undergraduates to rest assured they are making the right decision. It’s obvious which firms you should apply to, and they all have nice online portals where you can submit your resume. Your focus is on breaking into the top firms, because you know a good IB job will open up doors to countless exit opportunities down the road.
In contrast to IB/Consulting, there are many paths an undergraduate could follow to break into real estate private equity. It is exciting that so many paths exist. However, undergraduates choosing their future might feel paralyzed when seeking to perfectly maximize their first career decision (side note, I really recommend “The Paradox of Choice” by Barry Schwartz). I want to highlight that there is no single correct path into real estate private equity.
Any CRE career that teaches you asset underwriting is great prep for REPE
Your core focus should be to learn asset underwriting. You can get this experience at a number of firms, such as CRE brokerages, REITs, debt teams at large banks, and real estate IB groups, just to name a few. Any career that teaches you how to translate fundamental financial statements into a financial model, from scratch, is a great career to prepare you for real estate private equity. REPE funds are most interested in hiring analysts / associates with asset-level underwriting experience, so you must develop that skill. Below, I’ve listed a few of the most common career options that will teach you this skill set.
Common path: CRE Brokerages
As you mentioned, the large CRE brokerages are a fantastic option. National brokerages such as CBRE, JLL, Eastdil, Newmark, Cushman, etc. For a full list of brokerages you can research for internship positions, I would point you toward NREIOnline’s 2018 rankings (https://www.nreionline.com/brokerage/2018-top-brokers?full=1). I wouldn’t put too much weight on any particular firm’s ranking, understanding that most of these firms are full of experienced and knowledgeable professionals. The key differentiator between these brokerages is their size and employee count. Below is a list of a few top firms as ranked by the total value of global transactions:
1) CBRE Group
2) JLL (now merged with HFF: https://therealdeal.com/2019/03/19/jll-buys-brokerage-hff-for-2b/)
3) Newmark Knight Frank
4) Colliers International
5) Eastdil Secured
7) TCN Worldwode
8) Marcus & Millichap
9) CORE Network
10) Avison Young
Real Estate Investment Trusts are also a good option
You could also target a career in a real estate investment trust. Certain REITs can be as hard to break into REPE, but it’s worth a shot. I would recommend focusing on careers in investments or asset management, both will teach you a lot that will come in handy when networking for REPE.
Although you may have set your sights on the REPE megafunds, regional REPE investors are another great option for experience. These will likely not have structured summer internship programs, in which case you will need to make yourself known to the community as a competent undergrad. A quick note on networking below, along with a series that details my networking strategy.
A lot of large CRE shops don’t have formal internships — so you need to network hard!
Unlike IB/Consulting, CRE firms do not always have extremely structured summer internship programs. This does not mean that internships do not exist. Rather, plenty of opportunities exist under the radar. This means you need to put your networking hat on and hit the pavement, contacting any and all connections at firms that could teach you asset underwriting. If you’re looking to improve your networking, I’ve already written my best practices in this series: How to Network into REPE (https://www.leveragedbreakdowns.com/2019/03/21/how-to-network-into-real-estate-private-equity/).