2017 has been a year of surprises. Brexit is on the horizon and there are mixed messages coming from the real estate industry on whether this will impact business performance. And of course this will affect any hiring intentions. However, I continue to see optimism and signs that real estate firms will ride out this period of uncertainty.
Following on from a busy year at the senior end of the market, we are now seeing an increase in junior to mid-level real estate roles, both newly created and replacement positions. This ties in with the Office for National Statistics statement that in the ﬁrst quarter of the year UK unemployment fell to 4.6%. This is the lowest level since 1975, and many real estate sectors (such as property management, development and valuations) are showing positive signs for the months ahead.. Acquisitions in the UK and Europe have also increased over last year. So my prediction for 2018 is that consultancies won’t have problems ﬁnding new work, but they’ll be challenged to find the skilled candidates they need to ﬁll the available positions.
A closer look at the Brexit effect
The real estate sector has been expanding despite the uncertainties we all know about. Manufacturing is also growing which seems to have been export led, supported by the depreciation of the pound following the referendum result.
More people have been looking for a job in real estate this year, as EU citizens rushed to ﬁnd employment in the UK ahead of Brexit. In fact there was a 12% month-on-month increase in those seeking jobs in London’s real estate industry this year. That compares very favourably with a 14% drop during the first half of last year.
Fed up with waiting
There’s further evidence that Brexit isn’t yet having a negative effect. Many clients I’ve been speaking to tell me they’ve become “bored” with waiting for something to happen and are hiring staff as normal. They cite strong growth in ﬁnancial services, IT and small business occupiers looking for premises in London as well as investment managers acquiring assets in regional UK markets such as Aberdeen, Edinburgh, Leeds and Manchester.
A mixed bag
As things stand, there have been both positive and negative stories of the real estate recruitment sector performance, but it is still early days and hard to make any firm predictions. Access to EU employees seems to be weighing heavily on the minds of some clients, particularly pan-European funds and investment managers who are headquartered in London. However, for now at least, most sectors continue to show a positive outlook. I’m fascinated to see how this all pans out in the coming months.
Real Estate Market Insights 2017
The decision to leave the EU has, without doubt, led to a slow-down in real estate recruitment. With the depreciation of sterling, acquisitions have seen a rise in activity as UK assets have become more affordable for overseas buyers. As a result, I expect to see general recruitment into real estate begin to increase.
Over the last 12 months, it’s become increasingly more difficult for consultancy-side candidates of any level to make the move to clientside. Even after three years in a consultancy and developing a good foundation of general practice many have struggled to make the transition. This is largely because they lack exposure to pure asset management or transaction management and don’t have the good numerical skills needed to model cashflows.
Despite the slow start in Q1, placements moved up a gear into Q2, with little change in Q3. This shows that the real estate recruitment market is buoyant, which, given the economic and political uncertainties globally, may surprise you. It’s very much a candidate’s market right now, with the likes of private equity firms, funds, REITs and consultancies recruiting for positions that exceed the number of suitable candidates.
What skills are in demand?
In Q3, we found even more of a demand for valuation surveyors in the market, ranging from newly created roles to boosting established valuation teams. We’ve seen more landlord and tenant positions, which would indicate a busy period for private practices in London. What’s more, my clients are also looking for candidates with one to two years of general practice experience incorporating mixed areas of professional work such as valuations and lease advisory for sought-after Asset Manager positions as Associate level.
I’ve also seen a lot of of recruitment within Business Rates roles at the senior level between £60,000 – £75,000. However, there’s a real lack of candidates within the Rating sector with this experience. Clients are often looking for MRICS along with business development experience at this level but firms are having to be more flexible and looking at candidates from wider professional services who don’t have business development experience.
We’ve also seen an increase in European opportunities both based in London and continental Europe, typically in locations such as the Nordic speaking countries, France, Germany and Iberia. This is down to pan-European investment managers continuing to look at investing in locations outside of London. This has created more opportunities for senior individuals in those countries as well as those bi/multi-lingual individuals in London that may have previously felt London was the only viable option to establish their real estate careers.
Within consultancies and private practices, Associate to Associate Director level candidates are in high demand, particularly in development, closely followed by valuations. Clients are also looking for extensive financial modelling experience, especially when paired with chartered status or a general practice background. Commercial awareness paired with strong technical knowledge is becoming a must-have.
Many capital markets teams, both on the clientside and consultancy-side, are finding that the pool of candidates at Associate level has shrunk. Despite a reasonably flat year for markets generally, most consultancy-side firms were inundated with work and struggled to keep on top of headcount.
2018. A look into my crystal ball
It’s difficult to predict what will happen over the coming year. Speaking with others in the real estate sector, as well as other recruiters, I wouldn’t be surprised if recruitment activity continued to increase, so things look promising. This will impact on the need to recruit, with firms struggling to keep their heads above water and turning work away. If that’s the case, I expect to see more newly qualified surveyor roles being created to pick up the slack where they haven’t been able to attract Associates or Associate Directors.
Expansion and restructuring
We’re experiencing a busy end to the year as most firms are still making replacement hires where there has been churn or are still looking to expand their valuations, transactions and portfolio management functions. We’ve also seen teams being restructured to find the right blend of skillsets and personnel. I expect core roles such as valuations, development, rating and property management roles to be high on the agenda, together with many opportunities across development and asset management.
The tech effect
The significant interest in Proptech globally has seen an increase in start-ups offering specialist expertise in this area, as well as major consultancies such as JLL and CBRE forming strategic partnerships with technology partners to launch proptech platforms. The likelihood is that this is only going to continue over the next 12 months with what is proving to be the biggest disruption to the tech industry since the Big Bang. Meanwhile, the ever-accelerating move to the Cloud continues to grow through the real estate sector. Artificial Intelligence is also improving and simplifying roles for employees across a range of sectors from Property Management to Transactions Management.
Retaining the best
This year we’ve seen a rise in newly qualified surveyors moving roles and we predict this to continue in New Year. We’ll probably therefore see more clients trying to retain employees by promoting from within rather than recruiting externally from competitor firms. This will make it more difficult for surveyors to move sectors, such as from valuations to development or rating to landlord and tenant.
On the clientside, I expect to continue to see the need for Analysts with excellent modelling skills to increase. I also expect to see that Asset Managers will continue to be in demand (in particular those with value-add experience) due to high investment in regional assets in the UK that require active asset management, particularly redevelopment initiatives.
A 2018 checklist for employers
Counter offers – These are happening more often than not. Firms don’t want to lose good staff and have to go through the recruitment process. Here are some ways to help avoid this:
- Move quickly– Prove your interest in the candidate. Don’t let a slow decision-making process be the reason you lose them – good quality candidates are on average interviewing at three or four firms.
- Sell in the role– Enthuse them with what can they gain from the role, how they can improve their skill set and how they can progress?
- Sell in the firm – Be open when talking about the culture of the team and the firm.
Engage candidates – It’s key that you work with us to engage the candidates you’re interviewing and help them get a real feeling for the role and the people they’d be working with, your culture, values and future goals. Remember the interview process is a two-way process and candidates that are interviewing for several firms need to feel an attachment to YOUR business. Talk with us about how we can paint a picture of what a career with you means to prospective candidates.
Benefits – Show off your benefits, as this may be important to your potential new employee.
Recruitment partner – Choose a recruitment partner with a solid track record of recruiting into your sector. One with knowledge and experience of how to eliminate the risk of counter offers happening.
A 2018 checklist for jobseekers
Counter offers are rife in a candidate short market and it is easy to be flattered by these. But, take the time to remember why you’re looking for a new role in the first place.
Don’t use a generic CV – Make sure you spend the time tailoring your CV according to each role you apply for, especially if you have a varied skill set.
In this busy market, particularly at mid-level, you may be involved in more than one process at a time resulting in more than one offer. Make sure you find out everything you need throughout the interview processes to help make the right decision. A reputable recruitment consultant should be able to keep you updated at every stage of the interview process, plus provide feedback and advice on areas you can improve.
Always be prepared – Give real thought prior to attending interviews about what really resonates with you in terms of the role and the company. It is important for firms to be convinced that you want to work for THEM and that you can add long-term value. An established headhunter or recruiter should run through extensive preparation with you beforehand, including company background, role profile, details on the person you’ll be meeting as well as interview practice and sample questions
Think carefully about your motivation – Before you even start your job search, it’s key to really know why you are looking for a new role. A simple ‘I’m bored’ or ‘I want progression’ isn’t enough. Dig deep and understand what a new challenge needs to offer you and what progression looks like for you. This way, recruiters can help you target your search with more focus.
“It is not often that a man can make opportunities for himself. But he can put himself in such shape that when or if the opportunities come he is ready.”
― Theodore Roosevelt
Wishing all our clients and candidates a very Happy Christmas and a healthy and prosperous 2018. If you are considering career options, or have a vacancy to fill, call us on 0203 865 6207 or email email@example.com.