New Talent Acquisition Strategies Dominate Commercial Real Estate Hiring
Proptech Innovations prompt Job Shapeshifting
NEW YORK, NY. – Commercial real estate hiring remains steady and just off all-time highs, yet the composition of jobs is undergoing a subtle evolution while the shrinking pool of job seekers is driving new, sometimes desperate recruiting strategies.
Commercial real estate job postings through Q3 2018 are up 11% over the SelectLeaders Job Barometer index and have now exceeded the long-term average for five consecutive years, reinforcing an employer sentiment of cautious optimism in the commercial real estate market. Commercial real estate jobs hit their peak in the first quarter of 2015 and outpaced the change in overall jobs, but over the past two years have lagged slightly behind U.S. job growth.
Graph 1: US & Commercial Real Estate Jobs 2007 to Present
Jobs that tend to wane when commercial real estate heads into a correction – Acquisitions and Development – continue to be vital areas of hiring activity with 9% and 8% of all job postings, respectively. “The hiring in development and acquisitions is remarkable given how long we’ve been at this stage in the cycle,” said David Funk, managing editor of the Job Barometer. Jobs in finance and investment continue as the most common opportunities followed by portfolio, asset and property management jobs.
Graph 2: Commercial Real Estate Jobs by Field
In contrast to steady hiring are changing job titles and expectations. Proptech innovation across commercial real estate sectors and fields is restructuring jobs to emphasize the agility to implement technology into fields from asset and property management to investment management and development.
The new job title ‘Occupancy Planner’ recently debuted, which requires adroit use of InSite for workplace planning, relocation, and build-out as well as understanding of 3D modeling software to allow users to visualize and customize space layouts. “This job in the past might have called for an architect or interior designer, but now due to proptech enhancements someone with technology aptitude and agility can fill the position,” said Susan Phillips, CEO of SelectLeaders.
The scale of investment in proptech today underscores the drive to transform how real estate is developed, acquired, and managed through technology-based innovation, and promises that the changing nature of real estate jobs is only beginning. Whether it is JLL’s creation of a $100 million-dollar fund for investment in prop tech companies, or Blackstone, Brookfield and others investing in real estate-related technology companies, a total of $12.6 billion poured into real estate technology companies in 2017 according to RE Tech. While Real Estate Technology jobs currently constitute only 2% of job tracked by the SelectLeaders Job Barometer, that number has doubled in the last three years. One of those new real estate technology jobs seeks a Commercial Real Estate Blockchain specialist to create, manage, and trade fractional interests in real estate, which is unchartered territory for hiring. “Real Estate experience is not the deal breaker in landing real estate technology jobs. Proven experience with a variety of real estate software is the best way to demonstrate the agility to move into this space,” said Phillips and added, “Technology will open up our industry to talent from other industries, but it will also increase the need for career development training to enhance people skills and emotional intelligence, because this is what the new software will be missing.
Challenges in hiring are not limited to real estate technology jobs, however. “Overall US unemployment stands at 3.7%, while commercial real estate is nearing a decade of positive hiring and with new entrants to the industry relatively static the talent pool is getting strained,” Funk continued, “The supply of professionals to the real estate industry is relatively inelastic.” Phillips noted, “The challenges real estate employers are feeling in hiring and retaining talent is borne out by the data that shows low applicant to job ratios and a resounding seller’s market.”
The result is that real estate job seekers today are the most selective, or pickiest, since the Job Barometer began tracking candidates’ behavior. This year job seekers are clicking on almost 58 job opportunities for each application submitted, double the number just two years earlier. “2006-7 was the last time we witnessed a similar level of reluctance to apply to an opportunity, but back then employers started to offer equity to lower and lower levels of applicants to seal the deal,” said Phillips and quickly added, “This economy is different, and employers are not that quick to compromise. They seem reluctant to hire relocations, and often take a longer and longer time to hire.”
Graph 3: Commercial Real Estate Job Clicks per Application
California and New York the top two destinations for commercial real estate jobs, with New York having the largest increase in opportunities in 2018 Q3.
Graph 4: Commercial Real Estate Jobs by State