On Wednesday, August 12th the NextGen group met with three seasoned professionals in the Commercial Real Estate Banking/Finance Industry. Ivan Gamboa with TriCity National Bank, Stephen McGuire with US Bank and George Justice with Town Bank gave us their insights into the industry.
How do you get into the industry or is there a large barrier to entry?
Often when getting into this industry, people start as a credit analyst, move to a JR RM and then to a RM. You should be open to relocating and willing to move to where the jobs are. Make sure that you have some sort of expertise to offer your clients. You need to add value to clients and use your experience to distinguish yourself. Milwaukee is competitive, figure out how to stick out in the crowd.
How is the downturn with the pandemic different than 08’?
All three suggested that the government and the banks are being more proactive, than they were 2008. Banks are willing to modify notes in order to help people carry through. The real issues may show up next year, (potential foreclosures etc). It’s really too early to understand how everyone is being affected. Liquidity is also a big difference; in 2008, there were no buyers, sellers or lending. This time around, the government has pumped in a lot of liquidity. Different sectors were hit at different times. Right now, hotels, hospitality and retail are taking big hits; in 2008 it was housing. National credit tenants have proven harder to work with. They aren’t quite solid as they were previously viewed. Local tenants have been more proactive and willing to work with the local banks.
Did they ever consider a pandemic being the cause of a major recession?
Not necessarily, but they all knew that a “black swan” event could be out there. They are rare and you don’t expect them, but they do happen. Additionally, we had been on such and economic boom that there was the feeling that something was coming down the line. Steve thinks the next black swan could be really high interest rates like previous events in history.
Words of advice:
-Keep your head down and stay focused, maintain discipline even during the good times
-Start with your end in mind, work backwards to get there
-Understand the importance of networking
-CRE is a marathon, keep putting in the energy and it will pay off in the long run
-Check your ego at the door, confidence is good, ego is not
-Hardworking attitude is more important than talent