How to start a career in commercial real estate? It begins with understanding three key steps:
- Explore the Industry: Gain a solid grasp of what commercial real estate (CRE) entails, from brokerage and development to property management.
- Educational Path: Secure the necessary education and certifications, often starting with a bachelor's degree in business or finance.
- Networking and Experience: Build connections through networking events and gain experience via internships and entry-level roles.
The commercial real estate industry is vast, contributing 17% to the U.S. GDP and supporting millions of jobs. This landscape offers diverse and lucrative career paths beyond the field of residential real estate. Whether it's designing a skyscraper or managing a commercial portfolio, each role plays a vital part in shaping the spaces where people live and work. Choosing your path in CRE wisely is crucial, as your career can be shaped by the deals you engage in and the networks you build.
I'm Ashley Gawley LRE, and with over a decade of experience in commercial real estate, I strive to empower both newcomers and seasoned professionals. By leveraging market insight and strategic growth, my goal is to help you steer the exciting journey of how to start a career in commercial real estate.
Stay tuned for a deeper dive as we explore the array of opportunities awaiting you in this dynamic field.
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Understanding Commercial Real Estate
Commercial real estate (CRE) is a broad and dynamic field that encompasses a variety of property types and roles. Unlike residential real estate, which focuses on homes and apartments, CRE deals with properties used for business purposes. This includes everything from office buildings and shopping centers to warehouses and hotels.
Industry Scope
The scope of the CRE industry is extensive. In the U.S. alone, it contributes about 17% to the GDP and supports over 2.9 million jobs. This industry is responsible for creating and maintaining the spaces where we work, shop, and play. The value of U.S. commercial real estate is approximately $20.7 trillion, highlighting its significant impact on the economy.
Career Roles
The roles within commercial real estate are diverse and can be custom to various interests and skills. Here are a few key roles:
Broker: Facilitates the buying, selling, or leasing of commercial properties. Successful brokers are self-motivated, have excellent communication skills, and build strong client relationships.
Developer: Focuses on the creation of new properties or the redevelopment of existing ones. Developers often work on large-scale projects and require strong project management skills.
Property Manager: Manages the day-to-day operations of commercial properties, ensuring they are well-maintained and tenants are satisfied.
Investor: Provides the capital needed for real estate projects. Investors can be individuals or part of larger investment groups and often benefit from passive income and tax advantages.
Attorney: Specializes in the legal aspects of real estate transactions, ensuring compliance with zoning laws and negotiating contracts.
General Contractor: Oversees construction and renovation projects, coordinating with subcontractors and ensuring that projects meet specifications and timelines.
Each role plays a crucial part in the CRE ecosystem, and there are many paths to explore. As you consider how to start a career in commercial real estate, it's important to understand these roles and how they align with your skills and interests.
Stay with us as we dig deeper into the educational requirements and steps to launch your career in this exciting field.
Educational Requirements
To start a career in commercial real estate, having the right educational background is crucial. While there are various paths you can take, understanding the basic educational requirements will set you on the right track.
Bachelor's Degree
Most entry-level roles in commercial real estate require a bachelor's degree. This degree doesn't have to be in real estate specifically, but relevant fields can give you a significant advantage. Common majors include:
Finance: Understanding financial markets and instruments is vital, as real estate deals often involve complex financial transactions.
Business Administration: Offers a broad understanding of business principles, which is beneficial in managing real estate operations and transactions.
Economics: Helps in analyzing market trends and economic indicators that affect real estate values.
Urban Planning: Provides insights into land use, zoning laws, and sustainable development, which are critical in real estate development.
Relevant Fields
While a bachelor's degree lays the foundation, diving into relevant fields can further improve your expertise and attractiveness to employers. For instance, courses in real estate law, property management, and investment analysis can be incredibly beneficial. These areas of study equip you with specialized knowledge that is directly applicable to the industry.
Certifications
Certifications are a great way to stand out in the competitive real estate market. They demonstrate your commitment to the field and provide you with specialized skills. Some notable certifications include:
Certified Commercial Investment Member (CCIM): This designation, awarded by the CCIM Institute, covers critical topics like financial analysis and investment strategies. It is highly respected in the industry and can boost your credibility.
Certified Commercial Advisor (CCA): Offered by the National Association of Commercial Real Estate Professionals, this certification focuses on areas like marketing, valuation, and contracts. It's designed to improve your ability to steer complex real estate transactions.
- Real Estate License: Depending on your state, you may need a specific license to practice commercial real estate. This typically involves completing pre-licensing education and passing an exam.
By combining a bachelor's degree with relevant certifications, you'll be well-equipped to tackle the challenges of a commercial real estate career. These educational steps not only provide you with necessary knowledge but also open doors to various roles within the industry.
Next, we'll explore how to effectively start your career in commercial real estate, including obtaining a license and choosing the right brokerage.
How to Start a Career in Commercial Real Estate
Starting a career in commercial real estate involves several key steps. From education to choosing the right brokerage, each step is crucial in building a successful career.
Pre-Licensing Education
Before you can start working in commercial real estate, you'll need to complete pre-licensing education. This is a requirement in most states, including California. Courses typically cover real estate principles, practices, and legal aspects. They give you the foundational knowledge needed to pass the licensing exam and start your career.
Licensing Exam
Once you've completed your pre-licensing education, the next step is to take the licensing exam. The exam tests your understanding of real estate laws, practices, and principles. Passing this exam is essential to becoming a licensed real estate professional. In California, the exam is known for being challenging, so make sure to study thoroughly and take practice tests if available.
Choosing the Right Brokerage
After obtaining your license, it's time to choose a brokerage. A brokerage is a firm where real estate agents work. It's important to select a brokerage that offers mentorship and training programs. Mentorship can provide valuable insights and guidance from experienced professionals, helping you steer the complexities of the industry.
Look for brokerages that have a strong training program. Training programs equip you with the skills needed to succeed, such as negotiation and client management. They also help you understand market trends, which is crucial for making informed decisions.
Building a Network
Building a strong network is vital in commercial real estate. Start by conducting informational interviews with industry professionals. These interviews can provide insights into the industry and help you build relationships with potential mentors and colleagues.
Attending industry events is another effective way to expand your network. These events are opportunities to meet other professionals, learn about the latest market trends, and gain exposure to different areas of real estate.
Don't forget to leverage LinkedIn. It's a powerful tool for connecting with industry professionals and staying updated on market trends. Make sure your profile is polished and reflects your career goals. Join relevant groups and participate in discussions to increase your visibility in the industry.
By focusing on these steps, you'll be well-prepared to launch a successful career in commercial real estate. Next, we'll explore how to gain practical experience through internships and entry-level positions.
Gaining Experience
Gaining hands-on experience is crucial when starting a career in commercial real estate. It helps you apply what you've learned and develop essential skills. Here’s how you can gain that valuable experience:
Entry-Level Positions
Begin your journey with entry-level roles such as analyst positions, property management, or leasing. These positions offer a solid foundation in the industry:
Analyst Roles: As an analyst, you'll dive into financial modeling and market research. This role is perfect if you enjoy working with data and want to understand the financial side of real estate deals. Analysts are key players in evaluating potential investments and helping make informed decisions.
Property Management: If you prefer a more hands-on approach, property management might be for you. You'll learn how to handle daily operations, deal with tenants, and manage budgets. This role is ideal for those who enjoy problem-solving and have strong organizational skills.
Leasing: Leasing positions are great for those who enjoy interacting with clients. You'll learn how to negotiate lease agreements and understand tenant needs. This role can help you build strong communication and negotiation skills.
Internships and Job Shadowing
Internships and job shadowing offer a glimpse into the real estate world and are excellent for gaining practical experience:
Internships: Look for internships at commercial real estate firms. These positions provide exposure to various aspects of the industry and help you build a network. Internships are a fantastic way to apply classroom knowledge in real-world settings and learn from seasoned professionals.
Job Shadowing: Spend time shadowing experienced real estate professionals. This allows you to observe their daily tasks and gain insights into different roles. Job shadowing can help you decide which area of real estate interests you the most.
Both internships and job shadowing provide opportunities for mentorship. Learning from experienced mentors can accelerate your skill development and offer guidance as you steer your career path.
By starting with entry-level positions and gaining practical experience through internships and job shadowing, you'll build a strong foundation for your career in commercial real estate. Next, we'll explore how to specialize in a niche to further improve your career prospects.
Specializing in a Niche
Once you've gained initial experience in commercial real estate, it's time to consider specializing in a niche. Specialization helps you become an expert in a specific area, making you more valuable and in-demand. Let's explore the various property types and firm types you can specialize in.
Property Types
Commercial real estate encompasses several property types, each with its unique characteristics and demands. Here's a quick overview:
Multifamily: This includes apartment buildings and other residential complexes. Specializing in multifamily properties means understanding tenant demographics, rental markets, and property management.
Retail: From shopping malls to neighborhood centers, retail properties require knowledge of consumer behavior and tenant mix. Success in retail real estate often involves creating attractive spaces for businesses and customers alike.
Office: Office buildings range from skyscrapers in the core business district to suburban coworking spaces. Specializing in office real estate means understanding leasing dynamics and the needs of corporate tenants.
Industrial: This sector includes warehouses, manufacturing hubs, and distribution centers. It's a growing field, especially with the rise of e-commerce, requiring expertise in logistics and supply chain management.
Hotel: Hotels range from budget accommodations to luxury resorts. Specializing in this area requires skills in hospitality management, marketing, and operations to ensure profitability.
Choosing a property type that aligns with your interests and strengths can set you on a path to becoming a recognized expert in that niche.
Firm Types
Understanding firm types can help you determine where you fit best in the commercial real estate landscape. Here are the main types:
Limited Partner: As a limited partner, you invest passively in real estate projects. This role is ideal if you prefer to focus on financial investment rather than day-to-day management.
General Partner: Also known as the sponsor, the general partner actively manages real estate investments. This involves acquiring properties, overseeing operations, and driving the investment strategy.
Advisory/Services: Firms in this category provide specialized services like consulting, valuation, or brokerage. If you enjoy offering expert advice and helping clients make informed decisions, this might be the right fit for you.
Career Roles
Within each property and firm type, there are distinct career roles you can pursue. Consider roles such as:
Investment Analyst: Focus on evaluating potential investments and conducting financial analyses.
Property Manager: Oversee the daily operations of properties, ensuring tenant satisfaction and operational efficiency.
Broker: Act as an intermediary between buyers and sellers, negotiating deals and facilitating transactions.
By understanding the various property types, firm types, and career roles, you can make informed decisions about where to focus your efforts. Specialization not only improves your expertise but also opens up new career opportunities in the commercial real estate industry.
Next, we'll dig into developing key skills that are essential for success in commercial real estate.
Developing Key Skills
To succeed in commercial real estate, developing key skills is crucial. Let's break down the essential skills you'll need, focusing on financial analysis, market research, and negotiation.
Financial Analysis
Financial analysis is at the heart of commercial real estate. It involves understanding the numbers behind every deal and property. Key components include:
Underwriting: This is the process of evaluating the risk and potential return of an investment. You'll need to assess factors like cash flow, expenses, and market conditions.
Investment Analysis: Here, you determine whether a property is a good investment. This includes calculating metrics like the internal rate of return (IRR) and net present value (NPV).
Excel Modeling: Spreadsheets are your best friend in financial analysis. You'll use Excel to build models that forecast financial performance and evaluate different scenarios.
These skills help you make informed decisions and present clear financial insights to investors and stakeholders.
Market Research
Market research involves gathering and analyzing data to understand the commercial real estate landscape. Here's what you need to focus on:
Data Analysis: You'll collect and interpret data on property values, rental rates, and economic indicators. This helps identify trends and opportunities.
Market Trends: Stay informed about shifts in the market, such as changes in demand for office space or the rise of e-commerce impacting industrial properties.
Property Valuation: Accurately assessing the worth of a property is essential. This involves comparing similar properties and considering location, condition, and market conditions.
Being skilled in market research allows you to provide valuable insights and make strategic decisions in a competitive industry.
Negotiation
Negotiation is a vital skill in commercial real estate. It's about reaching agreements that benefit all parties involved. Key aspects include:
Deal Structuring: Crafting deals that align with the interests of buyers, sellers, and investors is crucial. This involves understanding financing options and contract terms.
Client Relations: Building strong relationships with clients helps in negotiations. Trust and clear communication are key to successful transactions.
Closing Deals: The ability to finalize deals efficiently and effectively is essential. This requires attention to detail and ensuring all parties are satisfied with the outcome.
Mastering negotiation skills improves your ability to secure favorable terms and build lasting partnerships.
By honing these key skills, you'll be well-equipped to steer the complexities of commercial real estate. Up next, we'll explore frequently asked questions about starting a career in this dynamic industry.
Frequently Asked Questions about Starting a Career in Commercial Real Estate
How to Get a Commercial Real Estate License in CA?
Starting a career in commercial real estate in California requires obtaining a real estate license. Here's what you need to do:
Research Licensing Requirements: Each state has its own set of rules. In California, you must be at least 18 years old and complete 135 hours of pre-licensing education.
Pre-License Education: Enroll in a state-approved real estate school to complete your coursework. This includes classes in real estate principles, practice, and one elective course.
Licensing Exam: After completing your education, you must pass the California real estate salesperson exam. It's a multiple-choice test that assesses your knowledge of real estate laws and practices.
Background Check: Before applying for your license, you'll need to undergo a background check. This involves submitting fingerprints and passing a criminal history review.
Activate Your License: Once you pass the exam and clear the background check, apply for your license through the California Department of Real Estate.
Getting licensed is the first step to launching your commercial real estate career. With your license, you can join a brokerage and start gaining experience.
How to Break Into Real Estate Acquisitions?
Breaking into real estate acquisitions can be rewarding but requires preparation. Here's a roadmap to get started:
Bachelor's Degree: While not always mandatory, a degree in finance, business, or real estate can provide a strong foundation.
Relevant Experience: Gain experience in related fields, such as property management or real estate analysis. Internships can be a great way to start.
Networking: Build a robust professional network. Attend industry events, join real estate groups, and connect with professionals on LinkedIn.
Analyst Roles: Consider starting as an analyst in a real estate firm. These positions provide exposure to acquisitions and help you learn the ropes.
Skill Development: Focus on honing skills in financial analysis and market research. These are crucial for evaluating potential acquisitions.
By following these steps, you'll position yourself as a strong candidate for roles in real estate acquisitions.
How to Start a Career in Commercial Real Estate Without Experience?
Starting a career in commercial real estate without experience is possible with the right approach:
Internships: Look for internship opportunities in real estate firms. They offer hands-on experience and can lead to full-time roles.
Entry-Level Jobs: Apply for entry-level positions such as a leasing agent or property manager. These roles provide valuable industry insights.
Networking: Connect with industry professionals through informational interviews and networking events. Building relationships can open doors to job opportunities.
Continuous Learning: Stay informed about industry trends and developments. Consider taking online courses or attending workshops to boost your knowledge.
Mentorship: Seek out mentors who can guide you and provide advice based on their experiences in the industry.
With dedication and the right strategies, you can successfully enter the commercial real estate field even without prior experience.
Conclusion
Starting a career in commercial real estate is an exciting journey filled with opportunities for growth and success. By understanding the industry, acquiring the necessary education, and building a strong network, you can lay the foundation for a rewarding career.
Career Growth in commercial real estate is promising. As you gain experience, you'll have the chance to specialize in different property types and roles, from multifamily and retail to office and industrial sectors. This specialization can lead to increased responsibilities and higher earning potential. With the right skills in financial analysis, market research, and negotiation, you'll be well-equipped to steer the complexities of the industry and close significant deals.
Launch Real Estate with Ashley Gawley is here to support you every step of the way. With Ashley's extensive experience and personalized coaching, you can confidently launch and grow your career. Whether you're just starting out or looking to advance, Ashley's custom guidance will help you increase sales and achieve a better work-life balance. Her expertise, gained from leading growth initiatives for top real estate companies, ensures you receive actionable insights that make a real difference.
For more information on how Ashley Gawley can help you succeed in commercial real estate, visit our services page.
The path to success in commercial real estate is built on continuous learning, strategic networking, and the willingness to seize opportunities. With dedication and the right support, your career in commercial real estate can flourish.
