Real Estate Analyst Jobs – Acquisitions vs. Investment Sales

All real estate analyst positions are not created equal, and the experience you’ll get in an entry-level role can vary a lot based on the specific part of the industry you choose to pursue.

Investment sales analyst and acquisitions analyst roles are prime examples of this, with these being two of the most desirable entry-points into the commercial real estate industry, but each of these paths can also end up taking your career in very different directions.

If you want to get more clarity on the pros and cons of each of these paths, this article walks through the differences between real estate investment sales analyst roles in brokerage and real estate acquisitions analyst roles on the principal side of the business, and some reasons why you might want to start out in (or avoid) each.

If video is more your thing, you can watch the video version of this article here:

Work Hours

On the brokerage side of the business, analysts working on institutional investment sales teams with high production volumes will see some of the longest hours in the industry, especially in a major gateway market like New York, San Francisco, and Los Angeles.

Even in secondary markets like Seattle, Miami, or San Diego, investment sales analysts will still usually work several hours later than their peers in acquisitions on a daily basis, and even though deal flow does tend to be slightly slower in these markets, analysts will still have times when they’ll be in the office past midnight finishing up a project.

Similar to investment banking roles, investment sales puts you on the sell side of the business, which can create an extremely erratic work schedule based on client or manager demands and can often include deadlines that feel unreasonable or unrealistic.

In brokerage, you’ll also often be working long hours to get a BOV out on time on a listing you know you won’t win, or putting weeks of work into an offering memorandum on a deal you know won’t end up trading hands, which can make these long hours even more frustrating when much of your work won’t result in closed transactions.

Alternatively, while work hours can be demanding on the principal side (especially at major private equity firms in gateway markets), you’ll be working on the buy side of the business, which means that you are the client. This can often provide a little bit more of a work/life balance, and even though you won’t win every deal you go after, your pursuit of a deal and the associated workload is generally going to be directly correlated to how serious your company is about acquiring a property.

In addition, even though the majority of deals you work on in acquisitions won’t end up closing, running a quick initial underwriting on a property is usually going to be significantly less up-front work than pitching a potential client to win a property listing.

It goes without saying that work hours can vary significantly from company to company, but if you’re looking for some general guidelines and rules of thumb to think about between these two parts of the industry, this has been my experience.

Pay

Investment sales analysts working on high-producing teams in major gateway markets are some of the highest-paid young professionals in the entire commercial real estate industry, so while the hours and workload can be demanding, analysts will usually be paid in relation to that effort.

Brokerage is also a great part of the business to work in if you like the idea of pay for performance, with compensation structures that are often heavily determined by the amount of deal volume your team wins and closes. This means that your work quality and ability to sell a deal on paper can make a material difference in how much money you earn.

Many brokerage teams are also set up with analyst “pools”, where producers in the office will voluntarily pick an analyst to work on specific deals. If you’re good at what you do, it’s very likely that you’ll see a significant amount of deal volume come your way, and you’ll very likely be paid in relation to your skill level.

In investment sales, base salaries are usually lower than acquisitions roles on the principal side at the analyst level, but if you’re sharing commission revenue on top of your base pay and your team is doing a significant amount of volume, this can often make your bonus even higher than your base salary.

Analyst roles on the principal side in acquisitions also often pay well, but you’ll usually see a much lower income ceiling than you would in brokerage, and a much less direct correlation between the number of deals closed and your total take-home pay. Acquisitions roles are usually structured with a relatively high base salary and a bonus percentage on top of that, but this is usually going to be based on the acquisition volume of the entire company, rather than your individual performance.

This makes acquisitions analyst roles sometimes feel much less like you’re being paid directly based on output, especially if you’re working at a company that’s only doing a small handful of deals per year. And while a higher base salary can be a good thing during slow times, this can also be frustrating if you’re entrepreneurial by nature and want to maximize your earnings.

Exit Opportunities

Both acquisitions analyst and investment sales analyst roles can open up a lot of doors in your career after spending just a few years in each, but where you want to end up in the industry long-term needs to factor into your decision regarding where to start out.

Exit opportunities for acquisitions analysts usually boil down to more senior-level, deal-sourcing focused positions, often associate roles within larger firms, or associate director or manager roles within smaller, more entrepreneurial organizations.

Acquisitions analyst positions also tend to prepare people very well for real estate entrepreneurship, teaching you how to analyze investment opportunities, how to present these opportunities to equity partners and lenders, and how to get deals across the finish line and added to your portfolio.

These types of roles also often expose you to the intricacies of equity partnership structures, including the implications of these structures on the cash flows to each partner on a deal, which can be really helpful insight to have when structuring your own deals and raising third-party capital.

On the investment sales side, exit opportunities are also very strong, and can often lead to faster early career progression and make it easier to land acquisitions roles at some of the top firms in the industry.

This is especially true if you’re working with institutional clients and seeing a lot of transaction volume in the first few years of your career, since these things will allow you to build relationships with major private equity firms that can make your transition onto the principal side relatively simple.

And because of the transaction volume you’ll have under your belt and the trust that you will have built with your clients over several years, this will also often allow you to come in at a higher level of seniority than you would have otherwise come in at, even when coming directly from acquisitions.

Brokerage is also unique in that it offers two distinct exit opportunities, and if you don’t want to move onto the principal side of the industry after your time as an analyst, you can also stay in brokerage and move into production.

With several years of experience as an analyst, you’ll be ready to build your own book of business, and you’ll also have a track record of successful transactions which you can present to potential clients.

How To Break Into Acquisitions or Investment Sales

Ultimately, both acquisitions and investment sales can be great places to start your career in commercial real estate, but if you’re trying to decide between the two, I hope this is helpful to find the right fit for you.

And if you want to make sure you have the skills you’ll need to land a job in acquisitions or investment sales at a top real estate investment or brokerage firm, make sure to check out our all-in-one membership training platform, Break Into CRE Academy.

A membership to the Academy will give you instant access to over 120 hours of video training on real estate financial modeling and analysis, you’ll get access to hundreds of practice Excel interview exam questions, sample acquisition case studies, and you’ll also get access to the Break Into CRE Analyst Certification Exam. This exam covers topics like real estate pro forma and development modeling, commercial real estate lease modeling, equity waterfall modeling, and many other real estate financial analysis concepts that will help you prove to employers that you have what it takes to tackle the responsibilities of an analyst or associate at a top real estate firm.

As always, thanks so much for reading, and make sure to check out the Break Into CRE YouTube channel for more content that can help you take the next step in your real estate career.