Wells Fargo Real Estate Investment Banking

Date:

Sabey And National Real Estate Advisors Llc Close $50m Capital Investment From Wells Fargo

Interview: Wells Fargo Investment Banking
  • 07.30.2021

Washington, D.C. Sabey Corporation and National Real Estate Advisors, LLC , announce the closing of a new $50 million investment by Wells Fargo Real Estate Capital Investments, LLC. Wells Fargo has invested through National, which is acting as the investment manager, and this $50 million investment is part of $320 million in capital raised by National in 2021, supporting the growth of Sabey Data Center Properties LLC .

We are pleased to partner with Wells Fargo to continue expanding our nationwide data center footprint, said Dave Sabey, Chairman & President, Sabey Corporation. Demand for digital capacity will continue to increase and, through our strategic partners, we are poised to meet that demand.

Wells Fargo is excited for this unique opportunity to invest with National and Sabey, two highly-valued and long-tenured Commercial Real Estate clients, said Sean Barlas, Head of Real Estate Merchant Banking at Wells Fargo. SDCP built an attractive portfolio of high quality assets in top markets which provide both stability and growth.

Sabey is a leading data center operator and developer with a proven track record, said Renee Logan, Managing Director, Real Estate Banking at Wells Fargo. Were excited to expand our 20-plus year relationships with both Sabey and National with an investment in an attractive asset class that will help enable SDCPs future success.

For more information about Nationals investment strategy, visit www.natadvisors.com.

Investment Banking Industry Groups: Real Estate

Real Estate Investment Banking Definition: In real estate investment banking , professionals advise entire companies in the REIT, gaming, lodging, homebuilding, development, and real estate services segments on raising debt and equity and completing mergers, acquisitions, and asset sales.

You have to be careful with this definition because many firms, such as CBRE and Jones Lang LaSalle , also have real estate investment banking groups.

In most cases, however, these groups help raise debt and equity for individual properties, not entire companies so it is not actual investment banking.

Similarly, banks such as Goldman Sachs might have separate Real Estate Financing teams, but these groups raise capital for deals involving individual properties.

If the group advises entire companies on equity and debt issuances and M& A deals, it is REIB otherwise, its more like a brokerage role.

The main verticals within REIB are usually:

  • Real Estate Investment Trusts These entities constantly raise debt and equity to acquire and develop properties, and theyre subject to special rules that eliminate or greatly reduce their corporate taxes. There are also mortgage REITs that invest in loan portfolios rather than property equity, but they operate more like commercial banks and may be covered within FIG.
  • Gaming Casino companies, but gaming sounds more sophisticated. Restaurant and live-event operations may also be included.
  • Lodging Hotels, resorts, and cruise lines.
  • Is This Opportunity Right For You

    Program structure and desired qualifications include:

    · Full-time program for seniors. Program length is 2 or more years. Analysts start with a six- to eight-week training program in Charlotte, NC before beginning work with their business unit

    · Summer internship for sophomores and juniors. Program length is 9 or 10 weeks. Summer analysts will participate in an immersive five-day training session located in Charlotte, NC

    · Placement in one of the following program tracks: Investment Banking, Asset Backed Finance, Eastdil Secured, Sales & Trading, Investment Portfolio, Public Finance, Research & Economics

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    New Markets Tax Credits

    NMTCs are available on a competitive basis to supplement funding of commercial , community-oriented, and mixed-use projects that positively impact qualified census tracts through job creation, neighborhood revitalization or provision of vital human services targeted to low-income communities. Typical deal profiles consist of:

    • 7-year construction/term loans, often interest-only or with minimal amortization.
    • Usually sponsor equity or market rate senior debt coupled with NMTC supplemental or B loans supported by the tax credits.
    • Financing is structured to fill gaps in the capital stack and/or operations for otherwise financially feasible projects.

    Recruiting: Who Gets Into Real Estate Investment Banking

    Trending FOX BUSINESS News: Wells Fargo Advisors to pay ...

    The same types of candidates who are competitive for other investment banking roles at bulge brackets, elite boutiques, and middle market firms are also competitive for real estate IB roles.

    So, it mostly comes down to the quality of your university or business school, your GPA, your previous work experience, and your networking efforts and technical preparation.

    You have an advantage if youve had previous industry experience, and you probably have an even bigger advantage here because real estate is specialized.

    But youre probably wondering about this question: Can you use other RE roles, such as lending or brokerage, to break into REIB through the side door?

    The best answer I can give is: Maybe, but dont hold your breath because its harder than you might expect.

    The problem is that the skill sets are quite different because in most other RE roles available to university graduates, you dont work with corporate entities the same way bankers do.

    So, its possible to use one of these RE-related roles to move into IB, but its more realistic to use them as an entry point into something like real estate private equity.

    If you want to use this strategy to get into banking, you should look for a RE-related role at a large bank it will be easier to transfer once youre already inside a big firm.

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    Real Estate Trends And Drivers

    The trends and drivers depend heavily on the sector, even within a specific area such as REITs.

    For example, a nursing-home REIT is influenced by different forces than a multifamily REIT or an industrial REIT, even though theyre all real estate investment trusts.

    And once you go outside of that vertical, a high-end casino operator is even more different from, say, an affordable home builder.

    Real estate is all about location, which means: How many people/businesses are moving into an area vs. moving out of it?

    For example, companies like home builders and multifamily REITs are driven by demographics, average income levels, and rent vs. homeownership costs in specific areas.

    If younger, higher-income people move into an area at a high rate, and new homes are relatively inexpensive next to renting, new home demand will be higher.

    Sectors such as office REITs are driven by business activity in the region and whether companies are expanding, shrinking, or telling employees to work from home.

    In the gaming and lodging verticals, consumer discretionary spending drives growth.

    These areas are tightly linked to economic conditions and income levels, and they suffer disproportionately when theres a downturn.

    Theyre also affected by factors like barriers to entry and the areas surrounding their key properties.

    Finally, technological shifts play an increasingly important role in real estate.

    For example, consider the impact of more white-collar professionals working from home:

    Real Estate Investment Trusts

    Representative Large-Cap, Global, Public Companies: Weyerhaeuser Company , American Tower Corporation , Equinix , Prologis , Simon Property , Welltower , Ventas , Public Storage, Boston Properties , Equity Residential , and AvalonBay .

    There are thousands of REITs worldwide, but fewer than 100 are public companies with over $1 billion USD in revenue.

    The largest REITs are based in the U.S., but countries like Australia, the U.K., France, and Canada also have a good number.

    REITs allow normal people to invest in the property sector without buying entire properties.

    So, if someone wants exposure to hotels, apartment buildings, or healthcare facilities, they can just buy a few shares in REITs that invest in them.

    REITs tend to specialize in certain geographies and property types, and some even focus on core, value-add, or opportunistic strategies.

    But their unique feature is that they pay little to nothing in corporate income taxes if they comply with certain requirements:

  • Dividend Distributions A high percentage of Net Income must be distributed as Dividends. The percentage varies, ranging from 90% in the U.S. to 75% in South Africa to 100% in some countries.
  • Revenue or Net Income High percentages of these must come from real estate sources. Its 75% of Revenue in countries such as Canada and Germany and 75% of Net Income in the U.S. and U.K.
  • Since REITs are always buying, selling, and developing properties and issuing Dividends, there are several consequences:

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    Wells Fargo Commercial Real Estate

    • 2

    It’s suprising that you have an interview but don’t know what the group does.

    Anyway, that’s their lending group. The group primarily does construction and bridge lending to investors, developers, and PE shops, but has been moving into the term space recently.

    I have a friend in that program and he likes it enough. The group is structured differently than at other BBs. At WFB you go from Analsyt> Lender where you have your own clients, source deals, close deals, and manage your book after you’ve closed. Other banks have the roles seperated .

    Blankster:It’s suprising that you have an interview but don’t know what the group does.

    Anyway, that’s their lending group. The group primarily does construction and bridge lending to investors, developers, and PE shops, but has been moving into the term space recently.

    I have a friend in that program and he likes it enough. The group is structured differently than at other BBs. At WFB you go from Analsyt> Lender where you have your own clients, source deals, close deals, and manage your book after you’ve closed. Other banks have the roles seperated .

    Sorry, didn’t mean to imply I didn’t know what the group did. I was looking more for progression and reputation which you answered nicely. Thanks.

    • 2

    I’m interested in RE lending groups as an entry to the real estate side of finance. I know of this program but are there similar divisions/programs at other large banks, and if so could someone tell me what these banks are?

    • 277

    Selling Or Transferring Ownership

    Moment of Truth: PeerStreet

    Whether youre considering a sale, an exchange, or an inheritance for future generations, we can help:

    • Identify and evaluate appropriate transfer options
    • Oversee property valuation, either to set an asking price or determine your tax deduction
    • Identify and qualify buyers

    Investment and Insurance Products are:

    • Not Insured by the FDIC or Any Federal Government Agency
    • Not a Deposit or Other Obligation of, or Guaranteed by, the Bank or Any Bank Affiliate
    • Subject to Investment Risks, Including Possible Loss of the Principal Amount Invested

    Brokerage services are offered through Wells Fargo Advisors. Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, and Wells Fargo Advisors Financial Network, LLC, Members SIPC, separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company.

    The Private Bank offers products and services through Wells Fargo Bank, N.A., Member FDIC, and its various affiliates and subsidiaries. Wells Fargo Bank, N.A. is a bank affiliate of Wells Fargo & Company.

    Wells Fargo & Company and its affiliates do not provide legal or tax advice. In limited circumstances, tax advice may be provided by Wells Fargo Bank, N.A. Please consult your legal and/or tax advisors to determine how this information, and any planned tax results may apply to your situation at the time your tax return is filed.

    Deposit products offered by Wells Fargo Bank, N.A. Member FDIC.

    CAR-1221-03031

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    Wells Fargo Nyc Is Not Guaranteed

    The real kicker is how Wells does location. Instead of applying, interviewing, and getting an offer for a specific city like every other bank in the world, **Wells places you into a city AFTER you sign the offer**. And what they don’t tell you until you find out for yourselves is that around 70%+ of positions are in Charlotte, not New York City or San Francisco.

    And while there is a group matching process, HR plays a heavy role and almost everyone preferences normal IBD groups in NYC, SF, or LA as their top choice so you can imagine how much of a shitshow that becomes. So after you sign the offer, there’s a very likely chance that you could get placed in something like syndicated finance or asset backed finance in Charlotte, especially with returning sophomore diversity interns taking up a lot of the NYC/SF spots before group placement for junior interns even begins.

    There is the possibility of switching groups between your SA and FT stint, however there tend to be very few or no spots in NYC or SF FT and everyone in Charlotte tries to switch out of cities so people successfully doing it are few and far between.

    You Are Leaving The Wells Fargo Website

    You are leaving wellsfargo.com and entering a website that Wells Fargo does not control. Wells Fargo has provided this link for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of this website.

    Our REIT finance team delivers corporate banking products and services to the public and private Real Estate Investment Trust industry, including corporate-level lending, asset-level lending and capital structure advisory. We utilize our deep REIT expertise and substantial capital commitment to the industry to deliver capabilities across the entire Wells Fargo organization, meeting client needs efficiently.

    Customers:

    • Publicly traded and private REITs

    Our products include:

    We can also help you with the following services:

    • Fixed income management

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    Real Estate Investment Banking League Tables: The Top Firms

    Banks with large Balance Sheets tend to perform well because so many real estate deals are financing-related.

    So, youll see firms like Bank of America Merrill Lynch, Citi, JP Morgan, and Deutsche Bank at or near the top of the league tables.

    Goldman Sachs and Morgan Stanley are also among the top performers, and you can add RBC, Wells Fargo, and Barclays to the top 10-15 list.

    MS and GS tend to be comparatively stronger in M& A and advisory work, and the others are stronger in equity and debt.

    Among the elite boutiques, both Evercore and Lazard perform well, focusing on M& A advisory work.

    In terms of other boutiques in the sector, everyone likes to mention Eastdil Secured.

    Wells Fargo used to own the entire firm, but they sold the private division while retaining the public market real estate investment bankers.

    As a result, the current iteration of Eastdil Secured, while a top real estate firm, is not a true real estate investment bank that advises entire corporate entities.

    On that note, there arent many true boutique banks that specialize in real estate many firms that call themselves real estate investment banks are more like debt and equity brokers for property deals.

    A few legitimate names include CS Capital Advisors , Ziegler , and Browns Gibbons Lang & Company .

    What Does My Future Look Like

    Wells Fargo knowingly helped Ponzi scheme, lawsuit claims ...

    Potential career path after completion of the program could include:

    · Private Equity Analyst

    · Strategy or Operations role at a start-up/VC-backed company

    · Corporate Development and/or Corporate Strategy positions

    · Promotion to Associate

    · Additional opportunities across the Wells Fargo platform, including other offices globally

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    Where Are The Opportunities

    Summer internship and full-time opportunities are located in:

    · Charlotte, NC

    Click link toMeet our Team Members

    Wells Fargo Corporate & Investment Banking is the trade name for the corporate banking, capital markets and investment banking services of Wells Fargo & Co. and its subsidiaries, including but not limited to Wells Fargo Securities, LLC, member of NYSE, FINRA, NFA and SIPC, Wells Fargo Prime Services, LLC, member of FINRA, NFA and SIPC, and Wells Fargo Bank, N.A. Wells Fargo Securities, LLC and Wells Fargo Prime Services, LLC, are distinct entities from affiliated banks and thrifts.

    Wells Fargo is committed to hiring and retaining diverse team members including Military Veterans, Veterans with disabilities, and transitioning Military personnel. We are working to increase diverse representation throughout the company and create an inclusive environment for all team members. When recruiting, we work with talent resources that focus on diversity and Veterans. We attend Veteran-focused job fairs and identify Military Veteran job seekers through resources like Military.com, Recruit Military.com, Hire Vets First, our internal Veterans Team Member Network and others. We invite you to use our Military Skills Translator to search for career opportunities here at Wells Fargo that match your military skills and experience.

    What Do You Do As An Analyst Or Associate In Real Estate Investment Banking

    You can expect to work on the standard transactions: follow-on equity issuances, debt issuances, the occasional IPO, and M& A deals.

    But there are a few differences:

    • Asset Disposals / Spin-Offs Asset-level deals are far more common among REITs and gaming/lodging operators because its much faster and easier to acquire a few properties than an entire company.
    • Highly Variable M& A Deals Its not that common to work on REIT-to-REIT M& A deals because there arent that many publicly-traded REITs. Acquisitions of entire companies tend to be more common in the non-REIT verticals.
    • More Deal Variety Since real estate is specialized, youll be more likely to contribute more to deals like IPOs and debt restructurings that are handed off to other teams when they come up in other industry groups.

    At most large banks, the model is to cover a few of the largest companies in each vertical and be on call for their transaction needs.

    But huge M& A deals are not that common among REITs and a few of the other company types, so youll spend a fair amount of time pitching and working on follow-on equity offerings, debt issuances, and asset deals.

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    Annual Economic Outlook Webcast

    View a replay of our webcast, “Restoring balance in the post-pandemic economy”

    View replay Password needed: WF1209

    You expect your investment bank to understand your company and industry inside and out. With Wells Fargo, you get that and much more.

    We take the time to listen and learn about your business growth opportunities, challenges, and operations. We combine this informed perspective with our product knowledge and market expertise to work with you and your team on a vision for your business, and we have the capital strength to help support your goals.

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