Summer 2005 Internship Experiences
Name: Jeff
Hendricks
Company: Wells Fargo Bank, N.A.
Location: Washington, D.C.
My twelve week internship with Wells Fargo was in the Washington, DC office of the Real Estate Group (“REG”), part of the company’s Wholesale Banking division.
About the Real Estate Group
The REG
provides financial services to experienced real estate
developers and real estate investment trusts. Our customers have
extensive experience in the industry and have proven their
expertise through several real estate cycles. The most common
services we provide are construction loans, land acquisition and
development loans, and secured and unsecured lines of credit for
various property types. Loan sizes range from $5 million - $100
million and the average is above $10 million (larger
transactions are typically syndicated). The REG has 24 offices
across the United States.
Summer Experience
This summer, I primarily worked on annual credit reviews for
three existing clients. This involved analysis of clients’
financial statements as well as their real estate portfolios. We
also conducted market and strategic analyses, and we put all of
this into final documents for review by the chief credit
officer.
In addition to the
annual financial reviews, I assisted in the underwriting of
two potential mixed-use developments: one in Newport News,
VA and the other in Kansas City, MO. Both of these
developments will be a mix of retail and condominiums, with
project costs of $42 million and $100 million, respectively.
The most valuable components of this experience was the
exposure I had to several different property types as well
as the in-depth credit analysis of the most successful real
estate companies in the region.
Name: Tommy
Huey
Company: Trammell Crow Company
Location: San Francisco, CA
I spent this past
summer in San Francisco, CA working as a Summer Intern for
Trammell Crow Company (TCC). TCC is a full service real
estate provider including development, project management,
building management and brokerage. My role this summer was
to support and help grow the brokerage services in the
Northern California region. I managed and worked with two
junior interns to develop business development strategies
and processes that will be replicated in other markets,
specifically San Jose and Silicon Valley. I also worked
closely with the brokers to better understand their needs
and to understand the brokerage business. I also worked
with the Area Managing Director in brainstorming and
developing a survey to analyze how large corporations make
real estate decisions. The goal was to determine if
companies were making the wrong real estate decisions based
on “flawed” analysis and how a company like TCC can add
value to them.
Name: Matthew
Stone
Company: Nomura Securities International, Inc.
Location: New York, NY
Areas of Internship: Commercial Mortgage Backed Securities (CMBS) / Fixed Income Rotational Program / Real Estate Private Equity Project
About the Nomura Group
The Nomura
Group is one of the largest global investment banking and
securities firms (largest investment bank and retail broker in
Japan). The company is based in Tokyo, and has 10,000+
employees in Japan. It has 4,000+ in London, and about 1,200 in
New York. Other worldwide offices are much smaller.
Summer Experience
The internship was 2 months. I worked in CMBS, but also
participated in a 3 week fixed income rotational program
through sales and trading, research, derivatives and risk
management, as well as about 3 weeks of classes in the
evenings with new hires. My project was to draft a
formation plan and financial model for a new $500mm Private
Equity Fund that will be levered to about $1B. I drafted a
40 page written document outlining the plan, worked up a
detailed, flexible financial model in Excel that would
incorporate 3 different classes of investments and up to 60
individual investments on a monthly cash flow basis over 10
years, and I presented my work to a group of about 20 Nomura
employees, including 5 Managing Directors, for about one
hour during the last week of the internship. I couldn’t be
happier with the experience. I learned a tremendous amount
about the complex world of fixed income, particularly
mortgage backed securities, as well as a lot about principal
investment / private equity.
Name: Heather
Densmore
Company: INVESCO Real Estate
Location: Dallas, TX
I interned in Dallas at INVESCO Real Estate, a large investment management firm. INVESCO manages the real estate portfolios for large institutions and pension funds. When I first arrived on the job, the firm sent me to a three-day Argus training class. Learning Argus was a great experience and will definitely come in handy for me in the future.
I spent the first half of the summer doing property valuations, mainly for multi-family properties. Once I became familiar with Argus as well as with the Excel model used at INVESCO, I began working more as an acquisitions analyst. I built several Argus models from scratch, mainly for large retail properties. The acquisitions manager I worked with helped me understand how to model certain things in Argus and how to analyze the returns and create deal structures. I found the acquisitions side of the business very interesting.
INVESCO made every
effort to ensure that I had a great internship experience.
They encouraged me to speak with people from all areas of
the company and to learn as much as possible. Not only did
I get great exposure to the valuations and acquisitions
areas, but I was also invited to attend the weekly
investment committee meetings and even went on several
property visits with the asset management team to better
understand their role in the big picture.
Name: Jeff
Lahr
Company: USAA Real Estate Company
Location: San Antonio, TX
I spent half the summer in Acquisitions and half in Portfolio Management. The Acquisitions division analyzes potential purchases for the USAA portfolio which is primarily comprised of office, industrial and hotel properties. The process begins when USAA receives a potential deal (usually from an outside broker) via fax or email. If the deal fits USAA parameters then an offering memorandum is requested; the memorandum contains information about the building(s), market and economic conditions as well as an Argus file which contains financial projections over, usually, a 10 year period. Next, an analyst (or an intern) revises the broker’s assumptions and generates a new Argus model along with an Excel discounted cash flow model in order to determine whether or not a bid should be made on the deal.
Portfolio Management is, as the name suggests, the management of properties within the existing portfolio. It involves the review and modification of: budgets, capital expenditures, tenant improvements, leases & commissions and any other issue that might arise with owned property. This division is much more involved with the day-to-day operations of a property and a position within Portfolio Management requires greater familiarity with individual leases, tenants and specific properties.
Finally, I completed a
research study on the Atlanta hotel market which focused
specifically on the submarkets of Buckhead and Midtown. The
project involved analyzing the existing and future hotel
market, economic conditions, construction and growth trends
as well as a cursory look at other development such as
office and residential projects. I was able to present the
study to the Real Estate Investment Committee during my
final week of the summer.
Name: Edgar
Cardenas
Company: Interurban Development
Location: Austin, TX
Company Description:
Interurban Development is a local condominium developer
focused on creating unique urban communities. In addition
to financial analysis in evaluating future equity capital
sources, I had the opportunity to be involved in various
aspects of projects in different stages of development.
These included implementation of sales/marketing
strategies, architectural and design sessions and general
contractor bid process and negotiations. I also had the
chance to learn first hand the documentation and support
required by lenders to release the first construction draw.
Name: Daniel
Campbell
Company: Schnitzer Northwest
Location: Seattle, WA
This summer, I had the opportunity to work in Seattle for Schnitzer Northwest, a leading regional real estate developer. I began the summer working with their Capital Markets group where I had the chance to participate in their strategic planning process, during which I reviewed and conducted financial modeling of each of the firm’s current office, industrial, and condo projects which total over 5.22 million square feet of development and over a billion dollars of project costs. As part of the Capital Markets group, I also assisted the team in sourcing potential joint-venture partners and securing financing for several land and building developments.
The rest of my summer
was spent creating a financial model to review the
profitability of the firm’s 7 million square feet of
property management operations. This included modeling the
fees and expenses associated with third party managed
properties, affiliated properties, and properties owned by
the firm.
Name: David
Probert
Company: McCaslin Properties Group
Location: Dallas, TX and Costa Rica
I worked for a real estate development group from Dallas for two months this summer. McCaslin Properties is owned and managed by two brothers: Carl and JD McCaslin, both UT graduates and with more than 20 years experience in most development types. My internship consisted in being the company’s man in Costa Rica. Activities included conducting due diligence for the loan prospects, as the company holds a portfolio of loans involved in real estate projects. Analysis included revising the project’s permits and architectural design, economic and financial model and project viability, design issues vs. local regulations, any legal issues and construction contracts as well as being the company’s liaison with the clients in Costa Rica.
The venture is
structured as a partnership between McCaslin Properties and
two bankers: Randall Harris of mainland bank, who serves as
point-man for the Costa Rican operation and visits San Jose
and Jaco for about 10 days each month; and Stacy Smith,
manager of a private equity fund. The loans authorized
totaled more than $1.5MM. I also participated in the
management of a condominium property on the Beach town of
Jaco, devising a series of actions to increase sales of the
restaurant and bar division. Finally, a case study for one
of the loan projects is in the works and should be submitted
by the end of the semester.
Name: David
Bullock
Company: Colliers Oxford Commercial
Location: Austin, TX
My 10 week internship was divided into two parts simply because of the company’s needs. The first 5 weeks I worked with the development group doing acquisition research for potential medical office and light industrial buildings in targeted areas around Austin as the company was trying to fill their pipeline. I found this to be a little boring since I had some previous development experience and I would have rather been working further down the development process seeing the design, site work or construction.
The next half of the summer I worked with a broker helping him show space, coordinate showings, run lease analysis, and search for potential sites for urban infill developers. It certainly helped that the broker and I got along really well and had a lot in common, but I learned much more than I had expected. You learn a lot about commercial real estate that will help you understand what so many of the assumptions on your pro-forma spreadsheets such as why occupancy will never be 100%, how long it may take to lease space, how much is usually offered as TI’s, how variable TI’s may be, what is negotiable with lease terms, what type of companies own the office buildings, how different needs use different space, and it is a great way to network with many industry professionals in the area you work.
Although brokerage
might not be my next career move, it is a great way to gain
a much better understanding of your spreadsheet inputs and
assumptions. You will also meet a ton of people, be out of
the office a lot, and learn how a specific market works
(maybe the one you want to stay in). Also, don’t give up
searching for your internship-I didn’t get this one until
June!
Name: Jeff
Folkmann
Company: Parkway Properties
Location: Jackson, MS
I interned for Parkway
Properties, a Real Estate Investment Trust (REIT), located
in Jackson, MS. I had the opportunity to work in their
Acquisitions Department, underwriting multi-tenant office
buildings located throughout the country. I underwrote
buildings in Atlanta, Orlando, Austin, Dallas, Phoenix, San
Antonio, Houston, and several other locations. I was able
to work on the full cycle of a prospective property, from
underwriting, to making an offer, to due diligence
and ending with Parkway assuming management of the
building. I was given an opportunity to work on various
other tasks that dealt with operations, accounting, finance
and the strategic vision of Parkway. One of the interesting
projects I was given was an economic feasibility study of
the Phoenix market. Parkway wanted to determine if the
market was going to continue to sustain its growth and
continue to be a market that was appropriate for them. I
was given meaningful projects and a more than expected
amount of responsibility, especially surprising because I
did not come from a real estate background. Overall, it
was a great experience.
Name: Sarah
Seeche
Company: ProLogis
Location: Chicago, IL
My summer internship was with ProLogis, a global REIT and leading provider of industrial property with more than 2,040 facilities owned, managed, and under development in 75 markets throughout North America, Europe, and Asia.
The internship was a rotational program geared to provide an overview of several key jobs in the regional offices as well as to understand the operating structure of the company. I worked with people in the following roles: property management, project managers, marking representatives, market officer and VP/regional manager. Additionally I was assigned a research project to work on for the 10 week internship program. My project was to analyze the main drivers of Funds for Operations (FFO) specifically focusing on the relation between FFO, occupancy, and rent growth. Then provide recommendations to improve ProLogis’ long-term leasing strategy at various points in the real estate cycle.
There were seven interns in the program. Three worked at headquarters in Denver and four, along with myself, were in various regional offices: Dallas, Atlanta, and LA. I worked in the Chicago office which was near O’Hare airport.
The internship program
began and concluded at the company’s Denver office. The
orientation meeting provided an opportunity to meet
ProLogis’ executive management team and to hear
presentations from each of the division heads to obtain an
overview of the company. The wrap-up was an “intern summit”
where each of the interns was given 20-30 minutes to present
their project to the executive management team and regional
VPs.
Name: Teddy
Dykoski
Company: ProLogis
Location: Dallas, TX
My summer internship was with ProLogis in Dallas, Texas. ProLogis is a REIT that owns and operates over 320 million square feet of industrial properties in North America, Europe, and Asia.
The internship offered a rotational program that enabled me to work with and learn about the operational structure of the company. The 10 week program rotated me through the development, property management, and project leasing groups. For example, during the development rotation, I was able to learn by evaluating different properties such as a 520,000 square foot development in Mesquite and a 200 acre piece of raw land just south of Dallas. In addition to the rotational program, each intern was given a project to analyze and present at the end of the summer. My project was to identify and evaluate Federal, State, and Local economic development incentives and their impact on the development activities of ProLogis.
The summer concluded
with an “intern summit” at the ProLogis headquarters in
Denver, Colorado where each intern gave a presentation and
conclusion of their summer project to the company
leadership. After each presentation, the company executives
discussed how the recommendations could be implemented
throughout the company. This experience provided great
satisfaction of knowing that my project could impact the
future profits and decisions of ProLogis.
Name: Jaclyn
Fitts
Company: Cypress Real Estate Advisors
Location: Austin, TX
Cypress Real Estate Advisors is a private real estate investment and development firm, located in Austin, which invests in a diverse group of real estate assets, primarily in the southwestern and southeastern United States. Cypress invests and develops across a wide spectrum of product types, including multi-family, senior living, hospitality, and large-scale mixed-use land development.
A sample of the tasks I performed at Cypress included:
· Worked to source new investment opportunities with a focus on niche markets
· Presented analysis of financial returns and recommendations to investment committee
· Procured
lending for $36 million multi-family asset by developing the
financing request package, providing site tours with lenders
and negotiating terms
Name:
Jennifer Harwell
Company: Billingsley Company
Location: Dallas, TX
Billingsley Company, located in Dallas, Texas, is a real estate acquisition, development and management company. Billingsley oversees investments in office, industrial, retail, multifamily and raw land and has holdings throughout Chicago and Texas. The company was founded in 1978 by Henry and Lucy Billingsley. Lucy Billingsley is the only daughter of Trammell Crow. Billingsley is currently involved in a high-profile mixed-use development in downtown Dallas that will be the future headquarters of 7-Eleven Inc. This development includes 500,000 square feet of office space, 15,000 square feet of retail and 70 condominium units. I was primarily involved in this project.
My direct activities
included analyzing the construction loan proposals provided
to Billingsley from various lending sources to determine
which proposal was the “cheapest” source of financing as
well as which proposal offered the most favorable
non-economic terms and conditions. I also helped to analyze
the various lease proposals for the office space. I also
was responsible for updating and organizing the project
timeline to track all aspects of the development and I
therefore regularly attended meetings related to
construction, financing, legal and marketing. All in all, I
enjoyed the internship and was grateful for the opportunity
to be exposed to other areas of real estate besides finance.
Name:
Michael Levy
Company: Matt Mathias & Co.
Location: Austin, TX
This summer I worked
at Matt Mathias & Co., an Austin-based commercial real
estate brokerage and investment firm. My responsibilities
included researching potential investment properties for
clients, and analyzing purchase and lease proposals
for projects represented by the firm. Additionally, I
worked with the firm on marketing its sites and properties
by developing marketing brochures for specific projects and
assisting with leasing and sale efforts. I also conducted
zoning and site research for some infill multifamily condo
projects in Austin and surrounding areas. I worked with
several product types including land, industrial, office,
retail and multifamily.
Name:
Justin Day
Company: Schnitzer Northwest
Location: Seattle, WA
About the Company: Schnitzer Northwest is a commercial real estate investment and development company focused on Northwest markets. Formed in 1997 by managing investment partner Dan Ivanoff and Schnitzer Investment Corp (A subsidiary of Schnitzer Steel in Portland, OR), in four years the company has developed and leased or acquired over 2.5 million square feet of Class A office space and 220 luxury multi-family units in the Puget Sound and Portland markets.
Specifics
about the Internship: SNWRE is
extremely active in the Seattle market with two condo/office
projects in downtown Seattle and several ground-up
development projects and acquisition candidates in the
Bellevue (east across the lake). For the summer, I worked
on their Acquisitions team, but also contributed to the
Capital Market business unit. During the internship, I 1)
performed in-depth analysis of Denver market by detailing
development firm profiles, in-progress project summaries,
urban growth trends and transportation initiatives, 2)
Contributed to an equity offering memorandum for a $22
million value-added industrial acquisition, 3) Coordinated
the compilation of a historical lease comparables database
and 4) Enhanced a joint-venture cash flow model by adding
switches for long-term and construction lending, equity
pay-down from operating cash flows and equity payback
analysis. I would highly recommend this firm to other MBAs.