Primary/secondary/tertiary markets in CRE?
Hey guys!, I know that in law/legal sector, there are often references to primary markets (NYC, LA, Chicago, SF etc) and secondary markets/fly over states (Charlotte, St Louis, Seattle, Portland etc.) What does CRE consider primary,secondary markets? And Im more concerned about CRE finance (analysis/research) than brokerage if that helps. Just trying to see how that market that I want to work in is perceived and how the job opportunities are. Thanks!
[{"id": "ct00w6d", "text": "It can vary by product type. For example, the inland empire is primary for industrial, but probably not for other stuff. That being said, just go to Wikipedia and look up the list of most populous metro areas (not most populous cities). The top 10 will likely be primary markets. ", "replies": [], "depth": 1}, {"id": "ct03dvg", "text": "I work in CRE Investment Banking and Finance.\n\nI have a few responses to your questions and you can feel free to reach out if you have more specific ones. In commercial real estate we refer to \"markets\" by the size of their \"MSA\" (Metropolitan Statistical Area). This is the best way to describe markets on a macroeconomic level because it naturally adjusts for density and includes all the counties in the metro area. For that reason the top 8-12 markets in terms of size are going to be considered \"primary markets\" to most people. \n\nThat being said, there is TONS of variation to this especially regarding property/asset type. Let me give you an example on the margins to highlight my point. Consider the property type: Resorts. A primary market for a resort could be somewhere like Aspen, or Miami, or Telluride, or something that is obviously not truly a primary market based on MSA size. But it could be for a specific asset type. \n\nNow, \n\nIn terms of the real estate finance industry itself. We kind of think of primary real estate markets and \"hot\" markets for real estate AND/OR cities that have a disproportionate amount of real estate activity going on in the economy. Think NYC, LA, Chiraq, SF, Dallas....\n\nAll of this being said, Real Estate Finance, especially on the development side, is HIGHLY localized. So even if you were somewhere that isnt a primary market like Charlotte, or Boston, or Denver, or Phoenix etc. it could be extremely fun and a great way to get into CRE as a career. ", "replies": [{"id": "ct0mgl1", "text": "CRE Finance intern here. Great response, thank you. Very informative.", "replies": [{"id": "ct28lbx", "text": "Keep up the good work man! Let me know if I can be a resource to you.", "replies": [{"id": "ct2s82c", "text": "I appreciate that, I will! ", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}, {"id": "ct221ph", "text": "This is a great answer.", "replies": [{"id": "ct28khv", "text": "Thank you. I appreciate that. ", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ct0nlwz", "text": "I don't care for a \"primary\" market, you have core markets which are the obvious NYC, SF, Boston, LA, Chicago, Dallas, Seattle, etc...secondary is anything in an urban MSA with a given population size, Tertiary is anything below that.", "replies": [], "depth": 1}]