Real Estate Private Equity Hierarchy
This post examines the hierarchy of the real estate private equity career path. All real estate private equity firms adhere to this hierarchy. Please note, different firms have different titles for the same role at the more senior levels of the hierarchy. For instance, a principal at one fund might be a vice president at another fund. To keep thinks comparable between firms, I have bucketed the most common titles into comparable tiers. These buckets are my own device to more easily communicate the layers of management -- don’t go quoting “Tier 1” in your interviews.
Tier 1: Analyst & Associate
Analysts and associates comprise the bottom tier of the real estate private equity hierarchy. This is the junior tier. Analysts and associates often work in tandem, with the associate taking point on managing the final deliverable.
The defining characteristic of the junior rung is input/output. Analysts and associates are asked to do work, and they do the work. Any questions or management that the junior personnel do is generally related to finding and answer to a question that has been asked of them by their managers.
Real Estate Private Equity Analysts
Analysts are fresh hires either directly from undergrad or with less than two years of experience at other real estate shops or investments banks. Analysts grind on whatever requires attention. Analysts will read through lease documents, spread rent rolls, and build real estate LBO models. Analysts rely on everybody above them to provide input and direction.
Real estate private equity analysts enjoy the most clear-cut work requests out of anyone else at the fund. Analysts are expected to complete specific tasks on tight timelines. However, there is little uncertainty as to what needs to get done. As analysts gain experience, the uncertainty increases. The asks shift from “please standardize this data” to “can you figure out what’s going on with this debt?” Once an analysts gains comfort with uncertainty, they are slated to become an associate.
Real Estate Private Equity Associates
Associates perform similar tasks to analysts. The key difference is their responsibility. Associates have been tapped as effective workers who know how to get results. If their asks them to “figure out this ground lease,” they will figure out every element of the ground lease and its impact on valuation. Associates strive to hone their skills in managing analysts and effectively chasing down answers from counterparties. Once an associate demonstrates capacity to keep the ball rolling, they are slated for promotion to the next tier.
Tier 2: Senior Associate, Vice President, Principal, etc.
This second tier is junior management. Common titles for positions in this stage of the real estate private equity career path are senior associate, vice president, and principal. When you make it to this stage, you are expected to ask and receive.
Contrasting with the analyst/associate tier, this junior management tier doesn’t dive directly into the weeds of source data to build models from scratch. Rather, junior management will review models and check for high-level correctness. They will typically run several processes at once, all worked day-to-day by teams of analysts and associates.
Tier 3: Senior Vice President / Director / Managing Director
This is the management tier. Professionals here are in their late thirties to early forties. The responsibility at this stage shifts to managing entire business units of the real estate private equity firm.
For example, an SVP of west coast office would be the senior point person for all things related to office investing. Any questions from the C-suite go to that person. This position is where a lot of grooming happens.
This tier also makes serious decisions regarding investment. Whereas the junior management tier manages a deal process, they usually aren’t calling the shots that make or break a deal. However, if an SVP/Director/MD greenlights a deal, there is an extremely high likelihood it will pass through investment committee. This is because managers will shop their ideas around before formally proposing anything to gauge its acceptance and success. Also, managers stake their reputation on the success of their investments.
Tier 4: Partner, Managing Partner, C-Suite
Once you’ve moved beyond SVP/Director/MD, you’ve been anointed as some form of partner role. This means you’re a key stakeholder in all business decisions. If at megafund, most partner-level investors have extensive experience across geographies and business units. REPE funds expect their partners to quickly manage the vertical chain of command. Once you’ve made partner, you’re effectively at the top of the food chain.
Tier 1: Analyst & Associate
Analysts and associates comprise the bottom tier of the real estate private equity hierarchy. This is the junior tier. Analysts and associates often work in tandem, with the associate taking point on managing the final deliverable.
The defining characteristic of the junior rung is input/output. Analysts and associates are asked to do work, and they do the work. Any questions or management that the junior personnel do is generally related to finding and answer to a question that has been asked of them by their managers.
Real Estate Private Equity Analysts
Analysts are fresh hires either directly from undergrad or with less than two years of experience at other real estate shops or investments banks. Analysts grind on whatever requires attention. Analysts will read through lease documents, spread rent rolls, and build real estate LBO models. Analysts rely on everybody above them to provide input and direction.
Real estate private equity analysts enjoy the most clear-cut work requests out of anyone else at the fund. Analysts are expected to complete specific tasks on tight timelines. However, there is little uncertainty as to what needs to get done. As analysts gain experience, the uncertainty increases. The asks shift from “please standardize this data” to “can you figure out what’s going on with this debt?” Once an analysts gains comfort with uncertainty, they are slated to become an associate.
Real Estate Private Equity Associates
Associates perform similar tasks to analysts. The key difference is their responsibility. Associates have been tapped as effective workers who know how to get results. If their asks them to “figure out this ground lease,” they will figure out every element of the ground lease and its impact on valuation. Associates strive to hone their skills in managing analysts and effectively chasing down answers from counterparties. Once an associate demonstrates capacity to keep the ball rolling, they are slated for promotion to the next tier.
Tier 2: Senior Associate, Vice President, Principal, etc.
This second tier is junior management. Common titles for positions in this stage of the real estate private equity career path are senior associate, vice president, and principal. When you make it to this stage, you are expected to ask and receive.
Contrasting with the analyst/associate tier, this junior management tier doesn’t dive directly into the weeds of source data to build models from scratch. Rather, junior management will review models and check for high-level correctness. They will typically run several processes at once, all worked day-to-day by teams of analysts and associates.
Tier 3: Senior Vice President / Director / Managing Director
This is the management tier. Professionals here are in their late thirties to early forties. The responsibility at this stage shifts to managing entire business units of the real estate private equity firm.
For example, an SVP of west coast office would be the senior point person for all things related to office investing. Any questions from the C-suite go to that person. This position is where a lot of grooming happens.
This tier also makes serious decisions regarding investment. Whereas the junior management tier manages a deal process, they usually aren’t calling the shots that make or break a deal. However, if an SVP/Director/MD greenlights a deal, there is an extremely high likelihood it will pass through investment committee. This is because managers will shop their ideas around before formally proposing anything to gauge its acceptance and success. Also, managers stake their reputation on the success of their investments.
Tier 4: Partner, Managing Partner, C-Suite
Once you’ve moved beyond SVP/Director/MD, you’ve been anointed as some form of partner role. This means you’re a key stakeholder in all business decisions. If at megafund, most partner-level investors have extensive experience across geographies and business units. REPE funds expect their partners to quickly manage the vertical chain of command. Once you’ve made partner, you’re effectively at the top of the food chain.