Introduction
Competency-based interviews (CBIs) are now the preferred assessment method across investment banks, real estate private equity, credit funds, advisory platforms, and institutional owners/operators.
In transactional real estate roles — where execution risk, judgment, and pace are critical — hiring managers need to evaluate not only technical strength, but also the behavioural patterns that predict performance under pressure, stakeholder management, and investment judgment.
This guide outlines how to structure a competency-based interview for roles such as:
- Acquisitions
- Asset Management & Portfolio
- Real Estate Finance (lending, underwriting, origination).
- Transaction Management & Capital
- Special Situations, Distressed, or Structured
- Real Estate M&A / Corporate
1. What is a Competency-Based Interview?
A competency-based interview focuses on past behaviours as indicators of future performance.
Instead of theoretical or CV-based questions, the interviewer asks candidates to describe specific situations in which they demonstrated key behaviours — e.g., analytical rigour, deal execution, communication, stakeholder management.
The core principle:
“The best predictor of future behaviour is past behaviour in similar circumstances.”
CBIs are especially effective in transactional RE roles because they reveal how candidates behave during:
- High-pressure
- Negotiation
- Multi-party
- Deal execution
- Ambiguous or time-sensitive
2. Key Competencies for Transactional Real Estate Roles
Below are the behavioural competencies most predictive of success across real estate investment, finance, and advisory roles.
Analytical & Financial Competence
Assesses a candidate’s ability to interpret data, build financial models, synthesise findings, and make investment recommendations.
Sample questions to assess behaviour:
- “How have you validated an assumption that others disagreed with?”
- “Tell me about a time you recalibrated a model under time ”
Commercial Judgment
Critical in roles requiring underwriting, deal screening, or pricing.
Sample questions to assess behaviour:
- “Describe a deal you walked away from and why”
- “Give an example of an investment where you identified risk ”
- “If I gave you €100m to deploy, where would you invest and why?”
Deal Execution & Process Management
Evaluates capability to run and coordinate complex transactions.
Sample questions to assess behaviour:
- “Talk me through a deal where you owned the execution ”
- “Describe a time a deal nearly failed — what did you do?”
Stakeholder & Client Management
Includes internal and external counterparts: lenders, agents, lawyers, JV partners, borrowers, operating partners, and senior leadership.
Sample questions to assess behaviour:
- “Tell me about a difficult stakeholder and how you managed ”
- “When have you had to influence someone without direct authority?”
Communication Under Pressure
Important for roles interfacing with credit committees, investment committees, and senior sponsors.
Sample questions to assess behaviour:
- “Describe a time you had to deliver a difficult message to senior”
- “Give an example of simplifying a complex issue for a non-technical ”
Team Collaboration & Leadership (at senior levels)
Relevant for VP, Director, MD roles managing analysts, external partners, or deal teams.
Sample questions to assess behaviour:
- “Describe a time you mentored or developed a junior team”
- “Tell me about a situation where you led a cross-functional”
Resilience & Adaptability
Especially important in volatile markets or distressed investment environments.
Sample questions to assess behaviour:
- “Tell me about a time you faced significant deal”
- “Describe working through changing macro assumptions and repricing a ”
3. Structuring the Interview (The STAR+ Method)
The most effective structure for competency questions uses an expanded STAR method (“STAR+”):
S – Situation
What was the context?
Industry? Asset class? Location? Strategy?
T – Task
What was the problem or objective?
A – Action
What you specifically did (not the team as a whole).
R – Result
Commercial impact, financial outcome, or strategic value.
+ Reflection
What did you learn? What would you do differently?
This final step (Reflection) differentiates high-calibre candidates (self-aware; improves from feedback).
4. Sample Competency-Based Questions for Real Estate Finance & Investment
Analyst / Associate
- “Walk me through a time you had to rebuild a model on short What changed?”
- “Describe a deal you were responsible for What was your key contribution?”
- “Give an example of synthesising large amounts of data into a concise ”
- “Tell me about a mistake you found in your work or someone else’s.”
VP / Director
- “When have you disagreed with an investment thesis? How did you handle it?”
- “Describe a situation where you led negotiations with brokers or”
- “Tell me about a time you managed conflicting priorities across multiple ”
MD / Leadership
- “Give an example of shaping the strategy of a platform or new ”
- “Describe how you’ve built or developed a high-performing ”
- “Walk me through a challenging capital raising or major transaction you ”
5. What Good Looks Like (Evaluation Markers)
High-performing candidates will show:
Clarity
Clear, structured answers; no rambling.
Ownership
“I did…”, “I led…”, not “we”.
Depth
Specific numbers, deal sizes, responsibilities.
Judgment
Realistic risk assessment; understanding trade-offs.
Self-awareness
Ability to articulate learnings and adjustments.
Commercial mindset
Linking actions to P&L, return, risk or stakeholder value.
6. Common Pitfalls to Watch For
X Overly vague, high-level descriptions
(“We analysed the deal…”)
→ Indicates no real involvement or unclear thinking.
X Inability to articulate financial rationale
→ Risk of weak modelling or poor investment judgment.
X Blaming others for issues
→ Poor resilience and poor stakeholder management.
X No quantification
→ Transactional roles require precision.
X Overreliance on team answers
→ Hard to assess individual contribution.
7. Final Section: Designing a Competency Framework for Your Team
For hiring managers, we recommend mapping competencies to each level:
Analyst
- Modelling accuracy
- Analytical rigour
- Speed & attention to detail
Associate
- Execution support
- Independent ownership of workstreams
- Stakeholder communication
VP
- Deal leadership
- Origination contribution
- External negotiation
Director / MD
- Strategy
- Platform leadership
- Capital raising
- High-stakes negotiation
- Team development
A well-built competency framework creates:
- objective evaluation
- consistent hiring
- reduced “gut feel” bias
- better predictions of on-the-job performance
Summary
Competency-based interviewing provides a structured, objective way to identify high performers in transactional real estate and financial services roles.
At Caravel, we help investment managers, private equity funds, developers, lenders, and advisory platforms design interview processes that reliably distinguish genuinely high-calibre talent.
If you would like support designing a competency framework or running a search, get in touch to see how we can help:
John Lenz
Co-Founder
M: +44 (0) 7572 110867
London office: 8 Devonshire Square London, EC2M 4YJ Manchester office: 21-23 Merseyway, Stockport, SK1 1PN. www.caravelsearch.com
