Conversation on Breaking into REPE, Part One

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Below is a conversation I recently had with a student, which others might find helpful. 

Student: I saw one of your posts on Reddit regarding breaking into REPE and you said you'd be happy to help anyone with questions. So, I decided to take you up on that offer considering a similarity you have with me which is that I come from a non-target (Class of 2018), like you, and have been very interested in REPE. Given you've had great success, I'd like to pick your brain. To start off, I am interested in REPE, development, and deals. I thought that traditional finance was the end-all-be-all as I’m currently in a non-investment role with a Bond AM but have really turned my head onto real estate: the power of leverage, cash-flow, value-add, etc. With that said, I am a CFA lvl 2 candidate trying to produce shine on my resume because that is all that I have to show coming from a small liberal arts school.
  1. Do you think this is an absolute waste of time to continue going forward with this?
  2. Secondly, what is the best way to slowly make that transition to those aforementioned career desires? I thought about getting this recommended RE certification but I am not sure that will add any credibility either with zero experience.
I know this was just a dump of information, but any advice at all would be the greatest gift. Thanks and have an awesome week. 

Lev: Hey! So you’re in Bond AM, from a non-target, and want to transition into REPE? Would you be truly willing to start in REPE as an analyst? And on certifications, they help teach you but I don’t personally have any. I would take them to gain knowledge to help prepare for real estate private equity interview questions. The shine alone will show you’re serious, but I don’t think it will blow anyone away. 

Student:. Yes. I think if I networked hard enough and showed conviction during real estate private equity interviews, absolutely. At this stage, I am trying to figure out the best path which led me to WSO and Reddit. I'm consuming it all. And a bit more color: I work in a back office role at a medium-AUM billion bond shop that specializes in taxable and tax exempt municipal bonds. I was interning there and got a job the first day out of college, so naturally I took it and stayed since. It looks possible that I may be promoted as a credit analyst or Portfolio Management position in the very near future, but I've always had an interest in real estate from an investment standpoint and the parallels of finance in both bonds and PERE intersect in some aspects. I want to best set myself up for a transition into REPE. 

Lev: Okay got it. You could probably recruit directly into a smaller REPE shop. Your background isn’t super relevant (but isn’t totally irrelevant). So you’d just have to network hard and demonstrate strong knowledge of valuation, modeling, and the industry during your real estate private equity interview. If you really want to work at a giant megafund, you may need an intermediate step where you work at a broker or asset manager. Have you seen my website by the way? I have lots of good information to help you with real estate private equity interview questions.
Location: United States

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