Development vs. Acquisitions [Real Estate Careers]
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- čas přidán 29. 06. 2024
- Development vs. Acquisitions - Real Estate Careers // In commercial real estate, acquisitions and development roles are often lumped together when discussing career paths, but each provides very different experiences.
These differences include day-to-day responsibilities, the people you'll be working with, and considerations for real estate entrepreneurs planning to go out on their own, and in this video, I want to talk through the main differences between a career in real estate acquisitions and a career in real estate development.
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🕒 Timestamps 🕒
0:00 Introduction
0:35 Development
3:03 Acquisitions
5:06 Other Considerations
#realestatecareers #commercialrealestate
*Nothing in this video should be construed as tax, legal, accounting, valuation, or financial advice or recommendation. All information in this video is intended solely for educational purposes, and you are advised to consult with your own personal professional advisors regarding your personal investment decisions.
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Research and articles referenced in this video:
reason.com/2023/10/26/damning...
www.sfchronicle.com/sf/articl...
fred.stlouisfed.org/series/WP...
sfplanning.org/permit/developers
www.glassdoor.com/Salary/Hine...
www.glassdoor.com/Salary/The-...
www.glassdoor.com/Salary/Star...
Which of these paths are you most interested in?
Your comment about how your previous roles in the industry will influence whether or not you become a developer or an acquisitions professional is spot on.
I think it takes a certain type of person to be a developer IMO. It’s not an industry for everyone, you have to be patient, extremely optimistic but also not be bothered by disappointment.
Seeing an area go from nothing, to apartments, retail, etc is something I personally love.
Completely agreed - thanks for adding this!
I was literally just searching CZcams last week for videos of you talking about development as a career, glad you made one!
Can you make a video discussing the pros and cons of being in an acquisitions position as an LP vs GP? Comp in early years vs comp later on? What are the main questions to answer when deciding which path to go?
I have worked in both sides of the industry, and although Acquisitions has a lot of potential for scalability, I still prefer development. You just have to be a kind of professional that is comfortable with risk and uncertainty but could be incredibly rewarding if done right and diligently.
Hi Justin,
I’m an architect with 4 years of experience working for a developer across all aspects of the project side, but I am keen on venturing into development as an entrepreneur, as a more long term goal. As a move to learn more about the business side of real estate I’ve decided to undertake a masters in real estate which will focus on RE finance. Considering a developer also needs to understand how capital/debt markets and mechanics work, post graduating from my masters would you suggest a few (2/3) years in an acquisition focused role to better understand said mechanics or would you suggest working on the business side at a development shop (ie. Corporate finance/strategy etc.)?
Looking forward to hearing from you!
Thanks,
Karan
Hello Justin! Couldn't reach you on LinkedIn so I will try to get your advice here. Can someone from your team help with career traction for my personal situation? Do you have some career consultation in Break into CRE?
Whats kind of jobs would offer a role that involves both? I dont want to be stuck doing only one thing, working in both would be ideal.
I’m 52 hoping to end the rat race by 60 with above $1M. I know money is a liability to be exchanged for assets with real value like real estate (properties for rent) stocks (dividends) bonds (interest) But, what is it with bitcoin? I hear a lot about it and I'd love to diversify my portfolio.
bitcoin does not pay any yield but will reward you with growth that you can't find in any other asset class
look at the charts, bitcoin has outperformed every stock and banking product ever developed even after multiple pullbacks over the last decade. not a financial advisor but I know what i'm saying
The key is diversification. Personally, I delegate my investing to an advisor, cos my job doesn't permit the time to perform market analysis myself. Thankfully, my once ago stagnant portfolio has now 5X in barely 4 years, summing up almost 7 figure as of today.
i'm blown away! more info please? i am a young adult living in Miami where i've encountered several millionaires, and my goal is to become one... they all seem to be involved in either real estate, stocks, or crypto
Can't share much here, I take guidance from Evelyn Infurna a renowned figure in her industry with over two decades of work experience. I'd suggest you research her further on the web.
Would you say working in development is more excel/numbers heavy or design/people relations heavy?
The latter for sure
Would you say that working as an Acquisitions analyst for a value-add developer is a nice middle ground between both areas of the sector? I'm looking to move from being an analyst for a brokerage firm and go into development, so I can eventually do my own deals. I would love to see your take on this Justin.
Great question - in my experience, I've found that even when working on acquisitions with a heavy value-add component, it's relatively rare to get too far in the weeds in the construction process and learn the things you'd need to learn to be a skilled developer. If at all possible, transitioning straight into working on land acquisitions and ground-up development projects after your time in brokerage would be ideal.
Would like your take on this, I am currently a broker (2 yr experience) and will be moving to larger market/ state. I've been taking your modeling courses for a while now and am interested in looking into acquisition and development positions. Would an acquisitions/ or dev. role make more than a broker at a top 5 shop, or move into a brokerage role then transition to an acquisitions role later on.
If you're looking to maximize comp, in more "normalized" market conditions (not the ~70% YoY drop in transactions we've seen in 2024), high performing brokers at top 5 shops (CBRE/JLL/Cushman/Eastdil/Newmark) will typically make more than their counterparts working in acquisitions or brokerage roles ~5-7 years in to their careers. It's also usually significantly easier to transition from investment sales to acquisitions than vice versa (assuming you have a strong technical skill set), so staying in brokerage in your new market and transitioning into acquisitions or development after ~2-4 years could be a great move. Good luck!
@@BreakIntoCRE Awesome, that was my thought process as well, thanks for the input
I prefer dev for my private portfolio & acq for 3rd parties
Thanks for adding this! Very interesting - any specific reason why that's the case?
@@BreakIntoCRE I’d assume dev for private portfolios bc of the amount of control compared to that with 3rd parties.
How much is your program ?