This interview features valuation and financial analysis commentary provided separately by Suleman Iddrissu.
Laying Down the Foundation Q: Okay, let’s get started with your story and how you broke in.
You might expect to see similar offerings from construction equipment (Deere and Deere Finance) or even automotive (ex: GM) makers.
Demand for houses is the strongest indicator of where this sector is going – in a poor economy with high unemployment, home building is not a great place to be.
There are pockets of activity around the globe known for this segment – Las Vegas, Atlantic City, and Macau come to mind (see page 19 here).
The key driver here is how well casinos can keep gamblers inside the casino and spending money (hence all those free bottles when you gamble away your bonus in Vegas…).
Proximity to other major cities is a driver in the Asia market, as is transportation infrastructure (See here for an example of a lodging company’s overview).
Unlike residential or commercial buildings, which feature long-term leases, hotels have “lumpier” and more seasonal revenue – which presents both a challenge and an opportunity.
For example, would you ever be involved with selling or financing the acquisition of a regular apartment building?I don’t think too much of what I’m saying here is specific to real estate – networking in any area of investment banking is the same.Here, you just need to be certain that you show passion for the sector to maximize your chances of being placed in our group. so let’s jump into what you actually do in a real estate group at a bank. A: Real estate is one of the broader coverage areas in investment banking, and each sector is quite a bit different: Real Estate Investment Trusts (REITs): These firms are sort of like private equity firms, but for properties rather than companies.Certain bankers might also cover aggregates, which are related to the materials used in home building or even infrastructure development (NB: companies in this space include Martin Marietta Materials, or Vulcan Materials).Gaming: They should just call this one “Casinos,” but I guess “Gaming” sounds better.
Lodging: Mostlyhotels and resorts (cruise lines sometimes fall under transportation).