Industry Insights

Career trends in commercial real estate are shifting in 2019. And as the winds of change blow in, professionals in the CRE market must take note of developing patterns and new opportunities in order to stay competitive. New data indicates movement in the US economy and in hiring practices for real estate firms. Here’s what will be different and how to stay ahead of the curve.

CRE Career Trends: Cautious But Optimistic

Last month, Select Leaders, one of the country’s premier networking associations within the real estate industry, released their 2018 year-end survey results. The organization polled scores of real estate professionals – from HR executives to top management to average employees – to identify developing CRE career trends for the new year.

Simultaneously, the National Multifamily Housing Council (NMHC) in partnership with Willis Towers Watson prepared their own “2018 National Multifamily Industry Compensation Survey Report.” This report compiled responses from thousands of real estate professionals from 91 organizations across the US to identify compensation and employment trends for 2019.

The responses and data reported by both groups point to a cautious attitude about the real estate market. While most respondents believe 2019 will be a good year overall, there are several challenges on the horizon to be aware of. The market is changing. But with this change comes a mixed bag of potential hazards as well as significant opportunities.

The State of the Market, 2019

1. Opportunity Zones Investment

The recent Trump tax reform bill created an Opportunity Zones program. The program identifies low-income areas in need of investment and incentivizes investors who re-invest capital gains into building up these areas. These zones pose a substantial opportunity for real estate investment, and US Treasury Secretary Mnuchin predicted $100 billion will be funneled into these properties before long.

2. Abundance of Capital

Many survey respondents voiced concern with an abundance of capital in the CRE market. In 2019, this may likely have the effect of shrinking margins and increasing high-risk investments, weeding out inexperienced CRE professionals and rewarding more stable behavior.

3. Stable but Slowing Growth

The responses indicated increasing concerns that the pace of growth will slow in the real estate market. Prices and demand remain high, but some believe rising interest rates and geopolitical happenings may slow down the bull market. However, optimism remains high as compensation continues to climb moderately. Last year, approximately 65% of respondents reported an increase in compensation. About two thirds reported receiving a bonus. On average, real estate executives saw a 3.5% increase in pay, and companies are budgeting another 3.5% increase for 2019.

4. Shortage in Skilled Talent

A consistent CRE career trend for 2019 is opportunities for qualified talent. 58% of the Select Leaders survey respondents reported difficulty finding qualified professionals. 65% reported not taking their full vacation last year, and a possible explanation is the increased burden on current CRE professionals. Some report having to do the work of two due to the talent shortage. This affords both new and established talent opportunity to find exciting new positions.

5. Data Science Climbing

Data science is the next big CRE career trend. Leveraging data and predictive technology is changing the way CRE companies build, plan, and market. And this new wave is sure to be definitive for the 2019 market. This relatively unexplored niche poses a unique opportunity for those entering the new and changing world of commercial real estate in the next year.

The Outlook

Overall, the outlook seems positive for developing CRE career trends this year. Compensation is up, new areas of specialization are arising, and truly gifted RE professionals have room to grow. However, this optimism should be tempered by the knowledge that market increases will likely slow down in the next year or two. Now is not the time for overly risky investments, but for steady and sensible growth.

​Learn more about Opportunity Zones at NAIOP San Diego’s April Educational Breakfast

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A tight labor market combined with a hiring sentiment projected to be the highest it has been since the Great Depression is makes for a very favorable job market.

According to Manpower’s Economic Outlook Survey, net employment is 20%, a 1% increase from both the first and final quarters of 2018.

Specific to real estate and construction, nationwide, the seasonally adjusted net employment outlook in the construction sector is 23%.

95 of the 100 metro areas surveyed have a strengthening outlook, which is good news for job seekers looking for the next steps in their careers. Bring on 2019!

Read the full summary and find the survey here: Where The Jobs Will Be In 2019

Published on Forbes.com by Vicky Valet on December 19, 2018

With all the talk of the retail market and where it is heading, Macerich is introducing a new retail co-working concept to a few of its major retail centers.

Read more about how the company continues to innovate here: Macerich to Roll Out ‘BrandBox’ Digital to Bricks and Mortar Concept

Published by John Jordan with GlobeSt.com on November 16, 2018

Since Amazon couldn’t just decide on one new headquarters, Amazon has announced that they will be formalizing their presence on the east coast in Crystal City in Arlington, Virginia, and Long Island City in Queens, New York, What does the process look like for these cities now?

Read more at: The Search For Amazon HQ2 Is Over. Now Comes The Hard Part

While income growth is still below what you would expect of a recovered economy nationally, San Diego’s median household is the highest of the 50 largest US metros. Median income rose 5.4% in 2017 to $76,207.

California ranks as the 5th largest economy in the world and as such, the job market continues to tighten, which also has a hand in the growing wages. The job market is still hot, especially for candidates looking for that next step in their career and salary level.

Stay up to date on San Diego happenings here: San Diego ranks No. 1 for income growth in the U.S.

Originally published in the Well Street Journal

The Labor Department recently reported that initial claims for state unemployment benefits dropped to the lowest level it has been since December 1969.

The economy is still in an upswing and it is still a candidate’s market.

Published on Connect.media on September 7, 2018.

New Unemployment Claims Fall to Near 49-Year Low in U.S.