Intro Today, we’re going to learn about real estate private equity models focused on development. Read each of these questions as if you were being interviewed, and practice our responses as if you were responding out loud. This is baseline real estate private equity for beginners, so make sure you understand this information cold before […]
REPE Interview Prep: Development Model Basics Read More »
One of the greatest lessons we have learned in our REPE careers is that you never actually “arrive.” There is never a point when you can say with any confidence that there is nothing left to learn and you actually have things figured out. This points to a critical real estate private equity skill: continuous
Real Estate Private Equity Skills: Continuous Improvement Read More »
As a real estate private equity analyst, you will build complex LBO models and be responsible for their completeness and accuracy. Depending on your employer or the specific fund, your model may take into account the effects of taxes on investment returns. If so, you may want to consider a cost segregation study for acquisitions.
Real Estate Private Equity Model 101: Integrating a Cost Segregation Study Read More »
One of the things you will learn as a real estate private equity beginner is that many industry terms are both simple and complicated. In speaking of cap rates, what we mean is that cap rates have an “everyday” application that is intuitive and simple. Its foundation, however, is much more complicated. As you move
Cap Rates – Textbook vs. Street Read More »
Real estate assets are divided into three major types: Residential, commercial, and industrial. NAREIT (National Association of Real Estate Investment Trusts) tracks a dozen main property types in investment real estate and provides data on the returns realized in those property types (and several sub-types). Most REPE funds, however, focus on one of the five
The Five “Food Groups” of Real Estate Investment Read More »
Serious about a career in real estate private equity? If so, there are several key accounting terms that need to become instinctive. If you even have to think about the definition of these terms, you don’t know them well enough yet. The more natural these terms become, the more prepared you are to crush an
Essential Accounting Terms for a Career in Real Estate Private Equity Read More »
For a real estate private equity beginner, layering sales tax incentives into a real estate private equity model may sound intimidating. Like other incentives, however, accurate modeling comes down to understanding how the incentive is calculated and the timing of receipts. Sales tax incentives are not allowed in all states, but there are enough that
Real Estate Private Equity Model 101: Sales Tax Incentives Read More »
How do you convey the key drivers of property performance to Investment Committee (IC)? The first major hurdle you need to clear as a real estate private equity analyst is being able to construct a reliable and accurate LBO model. That isn’t where your job ends. You also need to be able to test the
Sensitivity Analysis: Quantifying and Communicating Risk Read More »
This is a very interesting time to begin your real estate private equity career path. In the past year (2019) we have seen interest rates begin to climb up from historic lows, then suddenly turn back down to historic lows again. One of the big questions that always lingers in the REPE industry is whether
Do Cap Rates Follow Interest Rates? Read More »
Commercial Mortgage Backed Securities (CMBS) play a significant role in providing liquidity to the commercial real estate market. In many ways, CMBS issuance is a bellwether for the overall health and liquidity in the commercial real estate market. During the Great Recession, CMBS lending essentially stopped for several years, and the first issuers back into
CMBS Basics, Part Two Read More »