The Inaugural SelectLeaders Job Barometer -- Spring 2007
Results from the first SelectLeaders Job Barometer report, the real estate industry's first assessment of the U.S. job market, forecast solid hiring and compensation growth, while also revealing some worrisome trends. The inaugural version of the report, conceived and developed by SelectLeaders (the company behind the online Career Centers of the industry's professional associations including the CCIM Career Center), and compiled and written by Cornell University's Program in Real Estate, provides a never-before-available look at the state of the human capital markets in commercial real estate. The assessment of national job postings, which centered on eight primary online job boards, captured real estate postings nationally during a two-week period in February and April 2007, resulting in a high level of sampling confidence within the study. Analysis of the job postings highlighted where the jobs were, and 287 senior executives and hiring managers were surveyed for the added insight of their firms' hiring and compensation outlook. Finally, analysis of resumes submitted for openings over a six-month period revealed where job seekers were applying. The results were broken down by sector, geography and job functions/career categories, essentially developing a new standard for analyzing the real estate industry's human capital market. The findings were reported by Anthony J. LoPinto , CEO of Equinox Partners, a retained executive search firm, and founder of SelectLeaders, in collaboration with Dr. David Funk, director of the Cornell University Program in Real Estate. “Hiring and compensation provide a barometer for trends in the commercial real estate industry, as well as for the U.S. economic outlook,” Mr. LoPinto says. Summary of the Report's Findings Among the notable findings in the SelectLeaders Job Barometer are the following: • Job postings showed a dramatic growth in the commercial real estate industry, soaring by 35 percent in the first quarter 2007. • 66 percent of senior executives expect compensation to increase in the next six months, and over 60 percent of industry employers expect to increase hiring over the same period. • The Southeast region, led by the Atlanta and Charlotte markets, had the fastest job growth of any region, experiencing a 60 percent increase in job postings in the first quarter, and, surprisingly, the Midwest region, led by the Chicago market, experienced a 43 percent increase in job postings, making it second in job growth nationally. • New York and California are the hottest areas for real estate finance jobs, but New York attracts twice as many applicants as California , which has led to a talent shortage on the West Coast. • Despite the rapidly growing demand for asset and property managers, the majority of job candidates seek the highly desirable “deal-making” positions that revolve around acquisitions, development, capital raising and investment banking – jobs that are not as abundant in numbers. • With the exception of careers in the multi-family sector, which consistently ranks between third and fifth spot for most jobs in every region, jobs by sector vary greatly from region to region. • Job functions and career categories seem to reflect the business activity and property types typical of the different regions of the U.S. For example, property management jobs are most abundant in the Southeast, Midwest and the Western regions, while Mortgage/Loan Origination and Underwriting categories show up in the highest concentration in the Mid-Atlantic, Southeast and the Midwest . Not surprisingly, openings in finance and banking seem concentrated on the coasts (Northeast and West), while development professionals have the most new opportunities in the Southeast and the West. • This study confirms what graduates of master's programs in real estate have experienced: a remarkable 20 percent increase in starting salary compensation over the past three years and starting salaries that outpace other MBAs. • Nearly 50 percent of employers are posting multi-sector jobs, indicating a clear demand for candidates who are able and willing to work across sectors, so job seekers are advised not to specialize too soon, but, instead, to develo p s kills applicable across multiple sectors and job functions. A War for Commercial Real Estate Talent Has Emerged “Candidates should pay close attention to regional and sector opportunities,” advises Dr. Funk. “If the candidates are willing to pursue prospects in other states and sectors, they will broaden their options as well as their resumes, and with multi-sector jobs accounting for 46 percent of all postings nationwide, cross-sector experience makes a candidate extremely appealing.” According to Mr. LoPinto, there are several reasons why the industry is currently experiencing a shortage of talent. “One of the major reasons is ‘The Brain Drain,' or lack of up-and-coming talent caused by few entering the real estate industry during the bust of the ‘90's, coupled with the baby boomers exiting the business and heading to the beach. Also, there has been an enormous influx of capital into real estate, fueling tremendous growth, and a corresponding demand for talent.” Dr. Funk adds, “With more companies going public, and greater institutionalization in the industry, the bar has correspondingly been raised on the caliber and qualifications for real estate job candidates.” “Notwithstanding the residential sector's less optimistic viewpoint, which the study concludes is sector-specific, the industry is quite optimistic,” observes Mr. LoPinto. “The question remains as to whether the hiring and compensation bubble will get so big that it will burst, or if the current optimism is indicative of a lot more runway in the current economy,” notes Dr. Funk. The need to attract accounting and financial talent is a problem beyond commercial real estate's borders, and it is clear that firms and senior managers are becoming increasingly motivated to do what it takes to recruit these candidates. And it gets no easier moving forward, as U.S. demographics, led by an exodus of baby boomers from the workforce, portend that 10 million jobs will go unfilled nationwide by 2010. The results from the survey of senior and middle managers is a good news story for job seekers and an affirmation for employers that their peers in the commercial real estate industry are looking to hire and pay more for real estate talent. It is a seller's market if you've got commercial real estate skills, and job seekers should find their options open as they evaluate opportunities in commercial real estate. The promising outlook for the commercial real estate job market should also sound an alarm for employers that they will need to work harder to gain the hiring edge on the competition. Can We Extrapolate to the Overall U.S. Economy? Commercial real estate development is reflective of the overall economy and a barometer of the amount of capital available for investment. The assessment of the job market is consistent with recent stock market performance and capital availability. The commercial real estate business, in turn, is a harbinger of jobs in the economy, and of business and housing needs. The latest report from the U.S. Department of Labor—indicating a reduced number of overall job openings relative to recent years —would appear to be a relatively short-lived phenomenon. The commercial real estate industry is optimistic, as investors with an eye to the coming years will note. About The SelectLeaders Job Barometer The SelectLeaders Job Barometer utilized data collected from three sources: a comprehensive sample from 8 primary job boards of all online job postings for professional commercial real estate positions, surveys among senior C-Suite and middle management in commercial real estate companies, and 74,853 resumes from job applicants submitted on the SelectLeaders site, as well as the SelectLeaders Job Network, comprising 11 real estate professional organization career centers, of which the CCIM Career Center is a member. The SelectLeaders Job Network includes the following partners: BOMA, CCIM, CMSA, NAIOP, NAREIT, NMHC, PREA, RICS, SIOR, ULI and GlobeSt.com, the real estate industry's premier online news site. The SelectLeaders Job Barometer will be a semi-annual report, with findings presented in spring and fall of each year. Additional points of data, as well as historical comparisons, may be added to each consecutive report, therefore expanding on previous reports' findings and providing ever more comprehensive picture of job market in commercial real estate and how it relates to the overall level of activity in the industry, and the economy. To download a free copy of the SelectLeaders Job Barometer, visit the CCIM Career Center at http://ccim.selectleaders.com/network/ (look for ‘The SelectLeaders Job Barometer' link). Employers can find Intern Jobs on the home page of CCIM Career Center , available on CCIM.com. For more information and to post internships for free, visit http://CCIM.selectleaders.com/internJobs .
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