Industry Chat: Real EstateSeptember 2017

Todd Carson

Senior Associate Director

MBA Career Management

Agenda• Working with MBACM

• Real Estate• Introductory Overview

• Trends

• Functions, Roles and Internships

• Company Relationships

• Career Pathways

• The Job Search• Offer Statistics

• Recruiting Strategy and Timeline

• Hiring Data• Offers, Compensation and Sponsorship

• Real Estate at Wharton• Wharton Real Estate Club

• Zell/Lurie Real Estate Center at Wharton

• Events and Resources

• Q & A

MBA Career Management: Advising from experience

Todd CarsonCareer Advisor, Real Estate (since 2011)

Pre-Wharton CV

• Private Equity: Pension Corporation LLP (London, UK)− Member of investment team responsible for management of $1bn portfolio of private

operating company assets− PC funded with $2.5bn total capital from JP Morgan, JC Flowers, Swiss Re and

others

• Investment Banking: Goldman Sachs (London, New York)− EMEA TMT Advisory: worked on advisory mandates for several mega funds including

Blackstone, TPG, Carlyle, and Providence Equity− Prior experience in European High Yield Capital Markets and Fixed Income

Operations

MBA Career Management

3

MBA Career Management Real Estate Team

Career Advice

• Self-assessment & decision making

• Networking

• Industry Insight

• Resumes, Cover Letter & Interview Prep

Corporate Relationships

• Develop employer outreach strategy with RRM

Programming

• Develop programs for students interested in Real Estate

TODD CARSONSENIOR ASSOCIATE DIRECTOR

Corporate Relationships

• Strategize best recruiting approach for variety of employers

• Co-manage employer relationships with Career Advisor

• Manage recruiting events

Student Support

• Assist students with logistics of on-campus interview process, job board postings, etc.

JAMIE HENDELRECRUITING RELATIONSHIPMANAGER

Partner with Real Estate Club, Zell/Lurie Real Estate Center

Representative Outreach List: Summer 2017

How can MBACM Help?

• Helping ‘Career Switchers’ find their path

• From X Real Estate Development• Firms to target

• Networking strategies

• Resources to utilize

• Timing

• Offer negotiation

Real Estate at Wharton – A Strong Franchise• Robust, global alumni base

– Global alumni community of c.1,600+ across development, asset management, private equity, advisory, brokerage

• Supportive, tight-knit group at Wharton– Historically, c.25 students accept full time roles in real estate each year (2-

3% of class)

• Strong placement on the buy-side

7

56%50%

WG17 Full Time Placement*

Development Acquisitions *Excluding Advisory roles

Foundation for SuccessSome notable alums in real estate

• Jeff Blau, President, Related Companies• Richard Bloch, Founder & CEO, H&R Block• Jonathan Gray, Senior Managing Director, Blackstone• Jeffrey Katz, President & CEO, Sherwood Equities• Edward Lewis, Chairman & CEO, Oxford Development Company• William Mack, Founder, CEO & President, Mack Company & Apollo

Real Estate Advisors• Dan Och, Founder, Och-Ziff Real Estate Advisors• Mort Zuckerman, Co-Founder and Chairman, Boston Properties

8

Industry Overview

Real Estate: Industry Overview

• Entrepreneurial, relationship-driven business = enterprise search

• Real estate is an asset class; job function is either advising or investing

• For buy side roles (apart from Development), prior real estate and/or finance experience are differentiating

• Asset management can be pathway to Acquisitions

• Commercial and Residential Development – most entrepreneurial

10

Recruiting Trends• Market remains robust, subject to global market volatility and end of ‘free money’• Career switching absolutely possible, but heavy competition from experienced talent;

need to demonstrate passion with research/knowledge• Private Equity can be a challenging search for those without prior buy-side experience• I-banking likely to hire in similar numbers to prior years. Compensation is rising,

lifestyle challenges being acknowledged and addressed (RE lighter than Corp.)

• There is mobility in the industry once you are ‘in’. If lacking prerequisite experience, some paths ton consider that are most open to career switchers

• Consider roles in leasing/investment sales• Brokerage, consulting, corporate real estate (eg. Google’s real estate portfolio)

• Summer internships likely to be ‘easier’ to secure than full time roles; can evolve into full time roles for 2nd years. Sometimes offers are made from summer employers later in the spring

• Networking is a significant part of the process and you will develop this skill!

Roles in Real Estate

Development Complex skillset and diverse responsibilities

Buy land, work through entitlements and project design, pro formas, source potential tenants, project financing, ongoing leasing

and eventual disposition

Acquisitions Investing, underwriting, sourcing, valuations, deal experience

Investment Banking

Financial modeling/valuation, overall sector knowledge

Advise PE firm on acquisition of portfolio of several thousand

residential mortgages

Private EquityRegional market knowledge, deal

experience, financing markets experience

Network/identify investment opportunities; manage purchase/sale

process; fundraise

Corporate/Asset Management

Management/development/retail experience, relationships with

builders, zoning laws, city planning

Tenant communications and marketing of sustainability initiatives. Summarize critical lease dates and

deliverables

Manage due diligence on acquisitions/dispositions, valuation & sensitivity analysis (Argus & Excel)

Typical Skillset Sample Responsibilities

Sample Internships2017 Development Summer Intern: This position will be responsible for managing several phases of the development of multifamily rental communities. This includes market analyses, financial analyses and budgeting, design conceptualization, management of the entitlement process including presentation before municipal and other regulatory boards, and participation in the construction/lease up process.

Summer Associate – Leadership Development Program: Summer Associates spend 10 weeks working with a Tishman Speyer team in a core functional areas. This is an opportunity to gain hands-on real estate experience, while contributing in a meaningful way to Tishman Speyer's business.

Past rotations have included the following areas: Acquisitions, Development, Asset Management, Leasing, Design & Construction, Portfolio Management, Equity Capital Markets, Finance, Emerging Markets, New Business Initiatives

Summer Associate (Acquisitions & Capital Markets): The individual will work closely with senior management to underwrite potential acquisitions and perform analysis related to the firm's capital markets activities. • Underwriting potential corporate and asset acquisitions• Preparation of ARGUS & Excel models to support valuation & structuring strategies• Supporting analysis on secured and unsecured debt acquisitions• Compilation of loan request books & other financing materials for portfolio properties• Communicating with executive management regarding ongoing project status

Companies That Made Internship Offers in 2017

A - M1 N - Z1

• Allianz Real Estate of America• AvalonBay Communities• Caesars Entertainment• Crescent Communities• Exeter Property Group• GoldOller• Greystar• Hines Interests

• PGIM• RLJ Lodging Trust• Scannapieco Development

Corporation• Somera Road• The JBG Companies• The Related Companies• Tishman Speyer• Trammell Crow Company• China Vanke Company

Companies That Made Full-Time Offers in 2017

A - I1 J - Z• Brookfield• CBRE• China Fortune Land

Development Co.• China Vanke Company• Corigin• Cortland Partners• Elmington Capital• Goldman Sachs Urban

Investment Group• Greystar• H/2 Capital Partners• Imperial Companies

• Jaguar Growth• JDS Development• Madison International Realty• Miami World Center Associates• The Related Companies• Trammell Crow• TRX Residential LLC

Employer Feedback • ‘Pre-qualified’ coming from Wharton - strength and rigor of the real estate program is

widely recognized

• Networking is most effective way to find opportunities. One on one interactions are more memorable than just attending info sessions

• Stay current on newsworthy items from firms that interest you; understand their business and don’t ask questions you could have found the answer to yourself

• Have a researched pitch as to why you want to work for a certain firm in a certain geography

• Treks are a great way to get to know firms – rarely will any say no to hosting, especially if there is an alum at the firm

• While future hiring is expected to remain steady, easy financing conditions have led to more than adequate supply

• Multifamily oversupply (in certain markets)? • Still opportunities to repurpose corporate real estate (eg. for tech employers)

Real Estate Tech

The Job Search

Two Strategies, One Search

MATUREMATURE ENTERPRISE• Navigate unstructured process

and timeline

• Be ready if an opportunity becomes available

• Prepare for multi-format networking opportunities

• Proactively build & leverage network, pitch solutions and employment opportunities

• Travel to companies and recruiters

• Sustain recruiting efforts throughout the year

• Follow structured process and timeline

• Be ready for when an opportunity is available

• Prepare for and attend “formal” recruiting events

• Market your candidacy and differentiators

• Conduct on-campus interviews

• Manage heavy recruiting schedule in fall/winter

Tailor your strategy to the company/roleto ensure recruiting success

REAL ESTATE

What Real Estate Recruiters Seek…

• Sense of career focus within the industry

• Intellectual curiosity/willingness to learn and work your way up

• Candidates who think beyond entry level compensation

• Strong quantitative and technical skills (i.e. ARGUS, modeling capabilities)

• Marketing and salesmanship

SKILLS

• Relevant industry/functional experience or ability to articulate how past skills are relevant

• Differentiated knowledge of the industry/location

• Marketing and commercial acumen

EXPERIENCE

• Fit with company culture

• Ability to communicate with variety of constituents (investors, construction crews, lawyers)

• Entrepreneurial mindset

• Tenacity – examples of achieving results when odds were stacked against you

SOFT SKILLS

Career Switching

93%

84%79%

75% 75% 75% 73% 71%64%

53%

42%38%

33%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

% FT Accepted Offers – Reported “Industry Change”

Pre-MBA Experience: Real Estate Full Time offers 2017

Investment Banking

33%

Real Estate27%

Consulting6%

Private Equity/VC6%

Investment Management

7%

Diversified Financial Services

7%

Social Impact7%

Manufacturing7%

Is Real Estate a good fit for You? Skills Culture Work/Life• Risk tolerance based on

analytics + gut instinct

• Collaborative approach

• Ability to manage wide range of tasks (analysis, politics, personnel)

• Confident personalities

• Passionate about the sector

• Build many lasting professional relationships

• Entrepreneurial spirit in the industry

• Open to career-switchers (in general) but must carve own niche

• Tangible impact on communities

• Subject to market conditions

• Hours correlated to deal activity

• Better lifestyle potential in Development, Asset Management

• Financial upside typically over the long term (comp. typically initially lower than other industries)

• International opportunities

23

• ‘98-01: Analyst, Investment Banking

• ‘01-03: Wharton MBA

• ‘03-06: Land Acquisition Manager

• ’06-Present: Managing Director, Acquisitions

Career Pathways: Home Builder PE

MBA Career Management

24

Recent Alumni in Real Estate

Development

Acquisitions

• James Kelly – Development Associate

• Matt Towerman – Associate

• Darren Wang – Associate

• Martha Kelley – Associate, REPIA

• Moira Kiernan – AVP, Acquisitions

• Brian Cantrell – VP, Acquisition & Capital Markets

• Chris Rosser – Associate

• Paul Zarian – Associate

• Michael Daschle – Director, Development

More Tips from Alums/Employers

• Employer feedback: general recommendations• “Show connections to particular geography. Family ties, knowledge about the

market, long-term plans, etc.” • “Make your passion evident. Stay current/attend club events” • “Property management or brokerage can be a launching pad to becoming an

investor down the road• “If you aspire to work in RE PE, i-banking can be a good way to build transaction

experience and connections”

• Employer feedback: reasons for NOT hiring Wharton students• Lacking credible-sounding connection to geographic location• Competition was better fit; candidates of interest had other offers• Maturity and ability to demonstrate long term potential, today

26

Hiring Data

Accepted Internship Offers

0

1

2

3

4

5

6

7

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

% of all accepted offers

Source of Internship Offers: Class of 2018

Personal Networking Connections

33%

Wharton Job Posting27%

On Campus Recruiting

27%

Career Fair6%

Wharton Alumni Contact

7%

Source of Full-Time Offers: Class of 2017

Personal Networking Connections

53%Wharton Alumni

Contact20%

On Campus Recruiting

13%

Return to Previous Employer

7%

Trek Networking7%

Timing of Job Postings

0

2

4

6

8

10

12

14

16

18

Aug Sep Oct Nov Dec Jan Feb Mar Apr May

Full-Time and Internship Job Postings 2016-2017

Timing of Internship Offers: Class of 2018

0

2

4

6

8

10

12

14

Timing of Full-Time Offers: Class of 2017

0

1

2

3

4

5

6

7

Internship Salary Breakdown: Class of 2018

Real EstateNumber Accepted 15Number Accepted (with salary data)

15

% of Accepted 2.2%Monthly Salary Range $2,000-$10,00025% Monthly Salary $4,000Median Monthly Salary $6,00075% Monthly Salary $7,444Number with Sign-On Bonus

1

Median Sign-On Bonus $7,000

FT Salary Breakdown: Class of 2017

Real EstateNumber Accepted 16Number Accepted (with salary data)

16

% of Accepted 2.9%Annual Salary Range $60,000-$180,00025% Annual Salary $110,000Median Annual Salary $125,00075% Annual Salary $135,000Number with Sign-On Bonus

7

Median Sign-On Bonus $15,000

Real Estate at Wharton

• NYC Development trek• Prior treks to Boston,

LA, Washington • ‘Make your own’

• Zell/Lurie Real Estate Center

• Fall and Spring meetings

• Winter Career Fair

Wharton Real Estate Club

• Commitment to delivering opportunities for ~150 student members to engage with the Real Estate community and identify career opportunities

• Partnerships with Zell/Lurie, MBACM and facultyClub Mission:

Career Treks Conference

• Guest speakers from Industry

• ‘Day in the Life’ panels• ARGUS training

program• Case competitions• Interview preparation • Social events and more

MBA Career Management37

Workshops

Chris Merriewether, Co-PresidentKeri Tiner, Co-President

2017-2018 Leadership

Samuel Zell and Robert Lurie Real Estate Center• Research center permanently endowed by Sam Zell, Chairman of Equity Group

Investments– Ranked best in country by US News & World Report for quality of faculty and curriculum– Awards fellowships and scholarships to promising real estate students, many of which

are funded by members of the Center

• Hosts meetings and lecture series attracting one of largest gatherings of senior real estate/finance professionals nationally– Meeting keynote speakers typically include leaders from both within and beyond the real

estate industry– Ballard Luncheon series hosts leading figures in Real Estate to meet in lunch setting with

students

• Career Mentor Program– Students paired with real estate professionals throughout the academic year at Wharton

• Center Leadership – Joe Gyourko, Director– Asuka Nakahara, Associate Director– Susan Sessa, Managing Director

38

*Students must be members of the Real Estate Club to participate in Zell/Lurie opportunities

Zell/Lurie Career Fair – Representative Attendees

39

Ackman Ziff Real Estate Group Goldman Sachs Olshan PropertiesAlexandria Real Estate Equities, Inc. GoldOller Oxford Properties

Alliance Partners HSP H/2 Capital Partners PCCP, LLCAmerimar Enterprises, Inc Harvest Equities Pennrose Properties

Arbor Phila. Industrial Development Corp. (PIDC Pennsylvania Real Estate Investment Trust (PREIT)ASB Real Estate Investments HFF HershaAvalonBay Communities, Inc. High Real Estate Group LLC PRG Real Estate

Berkadia K. Hovnanian Progressive Housing Ventures, LLCBlackRock PN Hoffman PrologisBlackstone Hines Prudential

The Bozzuto Group HR&A Advisors, Inc. Related CompaniesBrickman ICSC Resource Real Estate

Butler Burgher Group iStar Inc. Rialto CapitalCadre The JBG Companies Rubenstein Partners

Candlebrook Properties, LLC JLL Savills StudleyW. P. Carey Inc. JPMorgan Global Real Assets Silverstein Properties

CBRE Keystone Property Group SL Green Realty Corp.CenterSquare Investment Management Landmark Partners Spear Street Capital

CompStak Lazard Square Mile Capital Management LLC/InvestmentsConcordis Real Estate Advisors LCN Capital Partners Stabilis Capital Management

CoreNet Global, Inc. Liberty Group Holdings Starwood Capital GroupCoshare Liberty Property Trust Tishman

Dranoff Properties Lionstone Investments Toll Brothers, Inc.Eastdil Secured Lubert-Adler Partners UC Funds

Fir Tree Partners Real Estate Madison International Realty, LLC UDR, Inc.Found Advisors Meyer Bergman Vornado Realty Trust

Freddie Mac Morgan Properties/Acquisitions & Asset Mgmt VTSFreedom Mortgage Morgan Stanley Real Estate Investing Walker and Dunlop

General Growth Properties NYCEDC Westport Capital Partners LLC

August September October November December January

Work on your Resume

MBACMResume Book training Sept

4-7

EISs begin Oct. 21

Zell/Lurie Fall Member’s

Meeting Oct 27

EISs continue

Treks

Networking Expo

FRP apps. due

Interview Prep Session

Fireside Chats

FRP begins Jan 8

Zell/Lurie Career Fair

Jan 19

February March April May June July-Sept.

Interviews

Receive Offer

Interviews

Receive Offer

Zell/Lurie Spring

Meeting

Interviews

Receive Offer

Interviews/offers

Report your offers

Start Internship

Intern

Research, Strategize & Network

Research, Strategize & NetworkMBA Career Management

Real Estate Recruiting: Timing of Key Events

Real Estate Industry Research Page

https://students.mbacareers.wharton.upenn.edu/job-search-resources/research/research-industry/real-estate/

• Resources

• Company Target List

• Company Notes

• Workshop Archives

Next Steps and Resources• MBACM

─ One-on-One Advising (began 9/5)

─ MBACM Student Website

─ Career Workshops

• Real Estate Club

─ WGA Club Fair

─ WRE Club Info Session (Wednesday, 9/12 @ 6:15-7pm 2401 Walnut, followed by Happy Hour)

• CareerPath

─ Complete your profile and set email preferences

─ Create saved job searches

• Zell/Lurie Center

─ Fall meeting Oct 27

CLASS EMAILS

• Friday delivery (typical)

• Deadlines, workshops, and resources

INDUSTRY ALERTS• Sunday delivery

• Based upon industry preference in CareerPath (opt-in)

• Application deadlines, jobs, and recruiting events

ADVISOR EMAILS• Delivery as needed

• Industry-specific advice

• Recommended resources

• Reminders and deadlines

SOCIAL MEDIA

@WhartonMBACM

#WhartonMBACM

How We Will Communicate With You

Upcoming MBACM Workshops

• Sept 4-7 Resume Book Training

• Sept 12 International Student Resource Event

• Sept 18 & 19 Navigating CareerPath & MBACM Website

• Sept 25 Networking Formula for Success

• Sept 26 & 27 Developing Your Pitch

- Register through CareerPath -

Contact Information

Wharton MBA Career Management50 McNeil Building, 3718 Locust Walk, 215-898-4383

Website: http://mbacareers.wharton.upenn.edu/studentGeneral Email Inquires: mbacareers@wharton.upenn.edu

Todd Carson, Career Advisortcarson@wharton.upenn.edu

Jamie Hendel, Recruiting Relationship Manager jhendel@wharton.upenn.edu

Club Co-President Contact infoChris Merriewether chrjam@wharton.upenn.edu

Keri Tiner kerily@Wharton.upenn.eud

Follow MBA Career Management:

@WhartonMBACM

WhartonMBACM

Questions?