Leveraged Breakdowns

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. Do you think this is an absolute waste of time to continue going for...

Introduction This article focuses on how you should personally prepare for real estate private equity interview questions. Most students will just download a guide and memorize responses to questions. But this practice does not develop a strong mental model. In fact, interviews exist to probe your understanding. Your interviewer’s job is to hit you from every angle to expose your weaknesses. If your only defense is a rote understanding of common interview questions, then you will not hold up against a seasoned interviewer. So, what can you do to best develop true understanding ahead of your interview? Always practice for interviews by speaking out loud When preparing for real estate private equity interview questions , it’s all too easy to allow your brain to go on auto-pilot. Thus, I always make my mentees practice their interview questions out loud. Yes, it probably feels uncomfortable to speak out loud when you are alone. But get over it. Preparing for interviews by speaki...

The key to landing your first job in real estate private equity is to crush the interview. As an outsider to the industry, though, you run the risk of looking like an outsider if you don’t know the terminology forward and backward. No one wants to see that look on the interviewer’s face when you just said something that proves that you don’t know what you’re talking about. At Leveraged Breakdowns , we are committed to helping you become fluent in the language of real estate private equity and common interview questions. We also give you hands-on training with our real estate investment analysis online courses . Why isn’t it Just A Prepayment Penalty? Lenders love to throw in penalties in the event a loan pays off early. The early payoff could be due to the borrower refinancing or it could be due to sale of the property. The lender doesn’t really care. When lenders deploy capital, they do not want to see it come back early. They are managing cash flows and earning the spread be...

One of the questions we often get is whether there is a real estate private equity certification that will help applicants stand out from the crowd. There are a few certifications available, but they validate the experience a person already has. Put another way, most certifications require documented relevant experience in order to receive certification. If you already had experience, you would already stand out in the real estate private equity interview process ! Don’t let that deter you, however. Continuing education and certification can be a benefit to you long term, both in terms of skill development and in growing your professional network. There are a few options to consider. Certified Commercial Investment Manager (CCIM) The CCIM Institute is a global leader in real estate education, and is sometimes referred to as “the PhD of real estate.” There are over 10,000 CCIMs worldwide in more than 35 countries. Coursework includes financial analysis, investment analysis, us...

This post includes technical questions that I ask when interviewing candidates at my real estate private equity megafund. These questions are softballs meant to test your basic grasp of easy concepts. If you struggle with these real estate PE interview questions to any degree, then you’re not yet up to par. If you need to brush up, I highly recommend you check out Leveraged Breakdowns , the premier resource for real estate private equity education. Practice Until These Technical Questions Feel Like Baby Math Your interviewer considers the following technical real estate private equity interview questions to be easy, baseline checks of your skill. Practice until you’re comfortable in a high-stress interview. Also, make sure your mental math skills are tight. If not, there’s plenty of basic apps and websites out there that will help you practice. What is NOI? Question: What is NOI? What are the most common items included in NOI? Answer: Net operating income (“NOI”) is the st...