Classic real estate employment theory dictates that, a decade into an economic expansion, acquisitions and development job postings would be in a decline and property management jobs would be increasing. Today’s real estate job market defies that logic.
Acquisitions positions continue their steady increase and now represent 9% of all commercial real estate job postings, according to the latest SelectLeaders Job Barometer report. Development job opportunities also remain strong at 7% of all openings, well above the historic average of 4%.
“Hiring in acquisitions and development is extremely strong, and undoubtedly aided by investment ramping up within the 8,700 opportunity zones nationwide,” said Dr. David Funk, managing editor of the Job Barometer, adding that if even a fraction of the $2 trillion in unrealized gains available are invested it is enough to influence real estate hiring. Acquisitions jobs jumped past property management openings as the third-most job posting after openings in finance/investment and asset and portfolio management
Strong acquisition and development hiring typically characterizes coming out of a down real estate cycle, not at the cusp of a decade-long economic expansion. Yet the report says that these now represent two out of the top five commercial real estate job postings. “Equity chasing real estate deals combined with attractive debt pricing exacerbates the challenge in finding opportunities, which has added pressure to building out acquisition team talent and depth,” said Funk, adding that robust hiring of development talent underscores the rush to get in on opportunity zone projects before the end of 2019. “We will see whether hiring in acquisitions and development continue into 2020 as the benefits from opportunity zones tapers off.”
As the U.S. unemployment rate has hit a 50-year low of 3.5% and labor participation rates continue to rise, not surprisingly commercial real estate employment has shifted to a peak seller’s market.
Commercial real estate job seekers in Q3 2019 were the most selective on record, and in response employers are expanding their recruiting strategies. Jobs seekers’ selectivity in their job applications in this economy were dubbed as “The Pickiness Factor,” which rose to new levels during the summer of 2019 as real estate opportunities spiked.
Overall real estate job postings for Q3 remained on par with the same period last year, and followed the traditional decline in hiring activity during the summer.
Half of all commercial real estate jobs are found in just three states – California, New York and Texas – with a strongest demand coming from applicants in New York. New York represented 18% of all job postings in Q3 2019, yet 35% of all applications came from job seekers in the Empire State. In the first four months of 2019 even The Pickiness Factor waned for highly popular jobs such as acquisitions and development. The opportunities in tech-fueled new growth cities like Austin, Texas, is continuing to support the demand for acquisitions and development counter-cyclical real estate hiring.
The SelectLeaders Job Barometer, published since 2006, is the foremost survey of employment opportunities, trends and hiring practices in the commercial real estate industry.
Susan M. Phillips is the CEO of SelectLeaders, LLC, which powers the career centers for 12 premier real estate industry associations (whose members control or direct 90 percent of commercial real estate) and offers unequalled access to the real estate community.