Executive Summary
The report presents the activities I accomplished at the Capital Investment Realty Group, located in Los Angeles, California. I was an intern in the department of finance and auditioning as an asset management analyst. The company falls within the property management industry. The Capital Investment Realty Group specializes in the sale and lease of a commercial and residential building. I was engaged in job-related roles such as preparation of presentations, supporting administrative tasks, researching market trends/competition/pricing, creation of relevant financial analysis reports, and supporting the underwriting/due diligence phases. The company should improve its financial reporting by incorporating different sustainability indicators.
Company Overview
History
Founded in 2013, the CIRG operates in the real estate sector and has focused on selling or leasing commercial and residential houses targeting the entertainment and sports sectors. The company is known for its high performance in the record-breaking leases and sales (CIRG, 2018). In the last three years, the company has expanded the service bracket to offer customized real estate products to global and local customers (CIRG, 2018). At present, the organization operates under the full-cycle service charter, which merges the client’s resources, roster, and an impeccable network. As a result, the company functions as a powerful brokerage firm with a diverse service charter.
Products and Services
The primary service charter for the company is categorized into a commercial for lease, a commercial for sale, residential for lease, and residential for sale. The services are further categorized into real estate brokerage, asset management, vocational rentals, commercial lending, and commercial brokerage (CIRG, 2018). The company also offers other specialized real estate services such as property searches, conducting due diligence, and paid consultation. CIRG credits itself for the ability to source real estate deals that are not easily accessible to the open market (CIRG, 2018).
Real Estate Asset Management Industry
CIRG operates in the dynamic, expansive, and multifaceted real estate management industry. Focused on the Los Angeles market in California, CIRG has become a primary player targeting the sports and entertainment celebrity market segment by offering this unique customized real estate services (CIRG, 2018). This industry is characterized by high competition, expansive customer needs, and unpredictable market swings. It is estimated to be worth more than $1 trillion in the US (CIRG, 2018). The real estate management industry is further segmented into brokerage, asset management, and planning/construction sectors. Fortunately, CIRG has expanded its operations to capture all the sectors and is currently among the market leaders in the Californian real estate management industry.
Competitors
The primary competitors of CIRG are AVR Realty, True Blue Realty Group, and Simone Company. AVR Realty is CIRG’s top competitor since it also concentrates on the celebrity market. The company has been in the Los Angeles real estate management market for more than a decade and offers purchase or lease financial services. In the last financial year, AVR Realty’s annual revenue surpassed CIRG by 10% (CIRG, 2018). The Simone Company is also a strong competitor due to its focus on the commercial rental and sale market. Moreover, the company has been in the market for more than 20 years and has an expansive market network (CIRG, 2018). Lastly, the True Blue Realty Group has expanded its operations beyond Los Angeles, thus has higher equity than CIRG. The company has also focused on the business support services sector by offering 100% financing option for buyers and renters of different real estate properties across the US (CIRG, 2018). Despite this competition, CIRG has managed to expand its operations through product diversification, competitive pricing, and a series of free after-sales services.
Asset Management Analyst Internship
My Position and Description of Duties
The internship period at CIRG lasted for two months. The eight weeks was adequate to understand and apply class knowledge into the labor market. Specifically, I was assigned to the finance and audit department as an asset management specialist. The typical duties associated with this position are;
- Support the due diligence/underwriting phases of acquisition transactions.
- Assist in creating and providing useful financial analysis to the Investment Team on a need basis.
- Stay up to date with market trends, pricing, and the competition to keep the marketing team and other departments updated.
- Prepare presentations and support with various administrative tasks as needed, such as the arrangement of files, research, clerical duties, and locating different documents.
The activities under the asset management analysis job description run concurrently in any typical workday. These roles were spread across the day and begun with preparation for the presentation and supporting administrative tasks. The activities ended with closing files for complete sales or lease agreements. The typical day during the internship started at 8.00 am and ended at 3.30 pm. However, when the workload was high or during special projects, the day would end at around 5.00 pm. The offices were closed on Sundays and during public holidays. The office hours for Saturdays are from 8.00 am to 2.00 pm.
Strategy Analysis
The asset management analyst job description is very complex and requires a deep understanding of financial analysis skills. For instance, in calculating the asset turnover, I had to apply different financial analysis tools such as ratio to effectively measure the organization’s utilization of the available resources to generate sales (Damodaran, 2016). Moreover, the job description required a skill set for financial evaluation aimed at maximizing the value of the property for every investment alternative. Due to the complexity in the real estate management capital market, as an asset management analyst, I had to establish ways of managing the potential financial risks, audit the risk proportions, and recommend less complex selling or leasing process. These valuable improvements were integrated into the tax and regal rules controlling the investment property market (Nobes, 2014). The hardest role in the asset management analyst job description is portfolio management since it combines asset allocation, research, revenue forecasting, and data analysis.
What Type of Work that I Do
My job description was an asset management specialist. This position involves several duties in a typical working day. I would report in the morning and help with clerical and administrative duties such as arranging and sorting files from the previous working day and in progress sales or lease documents. This was followed by preparation of the room for a brief meeting with the chief accountant and auditor, depending on the agenda of the say.
At around 9.00 am, I would move to my office cubicle to commerce research on the market trend, competition, and pricing for on progress files. The research activities were unique to each file and often required application of the principles of financial management framework knowledge acquired from the classroom. In the afternoon, I was engaged in supporting the due diligence or underwriting the phases of acquisition transactions. During this activity, I applied the financial and auditing tools I acquired during the last semester. For instance, I had to follow the basic financial analysis skills such as balanced book of accounts to ensure that the transaction phases are accurately recorded.
I spent most of the evenings assisting in creation and provision of useful financial analysis alongside the company’s asset management analysts. These reports were generated for closed sale or leasing deals. The process of preparing these reports required application of basic accounting principles such as accurate forecasting, ratio analysis, and inventory management. I had an opportunity to visit some of the properties under sales or lease process as part of the procedural auditor requirements. Most the visits were done on Wednesday in the afternoons or when the workload was low. These visits presented an opportunity for understanding how due diligence is carried out and relevant instruments to apply. For instance, during one of the visits, I was given an opportunity to gather the relevant knowledge with the guidance of one of the asset management analyst. The information gathering process requires application of organization and writing skills I acquired across the semester.
Something I Did There that I Learned from School
I excelled in performing due diligence in the rental and lease agreements by applying the limited liability exposure skills I learned from school. I was able to effectively gather the needed resources and apportion them strategically to create a smooth transition from on-progress to closed files. As a result of this previous knowledge, I was able to positively impact the portfolio value in the file I was given to create from a scratch with guidance from one of the asset management analysts for the company (Marshall, McManus, & Viele, 2016). Moreover, through application of financial analysis skills I learned in school, I was able to track the expenditures against turnover in a consistent and productive manner. I was armed with basic communication, writing, and organization skills, which came in handy in analyzing the negotiations, lease approvals, and risk mitigation to generate professional files. In addition, I applied forecasting skills I learned from school to contribute in report generation and auditing of different value assurance initiatives (Nobes, 2014). For instance, during one of the random audit visits to the properties in the market, I made substantial contribution in the due diligence execution by confirming the taxation and legal requirements for each type of agreement.
Methodology
The internship opportunity at CIRG was an eye opener in understanding the operational framework for financial analysis within the real estate management industry. Through a practical financial prudence approach, it was possible to study the current trends in pricing, competition, and customer demands while managing efficiency in resource allocation for optimal return (Kimmel, Weygandt, & Kieso, 2014). The financial analysis framework provided a practical approach to correlation of policy and ligation by applying different tools for effective operational model. For instance, the fusion of auditing and financial forecasting knowledge creates an ideal environment for holistic and proactive supervision of different efficiency matrices associated with asset management analysis (Bhattacharyya, 2017). As a result, I was able to apply school knowledge and previous experience as a financial controller and private equity analyst to effectively perform my duties within the asset management analyst job description.
Results
The internship experience was an opportunity for application of school knowledge in a practical work environment. Since I had past experience as a private equity analysis and financial controller in one of the local banks, the internship experience was not challenging. I only made minor adjustments by using the ratios and financial analysis tools that are applicable in the real estate asset management analysis. The work environment was very challenging since I dealt with very sensitive documents and files that required accuracy in financial reporting. Any mistake in the figures would translate into loss or even a legal suit against the company. Fortunately, the company has systems that automatically scan and correct any human error. The internship period was a learning experience about conducting due diligence, auditing a financial process, and reporting efficiency matrices for optimal use of resources against expected outcome. At present, I am well skilled in asset management analysis in addition to other past experiences as a private asset analyst and financial controller.
Conclusion
The report has highlighted my experiences an intern within the finance and auditing department of CIRG. The company is located in Los Angeles and operates in the real estate management industry. I was given an opportunity to conduct due diligence, research, trend analysis, and generate market reports. The internship experience positively impacted on my professional skills in financial analysis and has influenced the direction of my future career.
References
CIRG. (2018). About us. Web.
Damodaran, A. (2016). Damodaran on valuation: security analysis for investment and corporate finance (2nd ed.). New York, NY: John Wiley & Sons, Inc.
Bhattacharyya, A. (2017). Essentials of financial accounting. New Delhi, India: PHI Learning Private Limited.
Kimmel, P. D., Weygandt, J. J., & Kieso, D. E. (2014). Financial accounting: Tools for business decision making (6th ed.). New Jersey, NJ: John Wiley & Sons, Inc.
Marshall, D. H., McManus, W. W., & Viele, D. F. (2016). Loose leaf for accounting: What the numbers mean (11th ed.). New York, NY: McGraw-Hill/Irwin.
Nobes, C. (2014). Accounting: A very short introduction. Oxford, UK: Oxford University Press.