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An Assessment of the U.S. Job Market in Commercial Real Estate

2013 January-May Update & Emerging Trends Job Barometer

Commercial Real Estate Jobs Rise 25% In Q1 2013

Cornell/SelectLeaders Job Barometer Finds Development Jobs Have Rebounded to Pre-2008 Levels

ITHACA, NY. – The pace of job opportunities in commercial real estate just left walking and has officially broken into a jog, and development may be ready to sprint. The Cornell/SelectLeaders Job Barometer reports that the commercial real estate job market continued its positive momentum from 2012 with job postings up 25% in the first quarter of 2013 compared to the same period the previous year. This continues the trend observed in 2012 where job postings were up 27% over 2011. This momentum is reflective of wider improvements in the economy with nonfarm employment up by 958,000 in the year to May and the unemployment rate down to 7.6%.

“The positive momentum in commercial real estate job postings are a strong signal that the sector has a renewed sense of confidence” said David Funk, Director of the Baker Program in Real Estate at Cornell University, “while nonfarm employment is still 2.5 million jobs below the pre-recession peak and the economy still has some way to recover, the outlook for commercial real estate employment looks positive.”

Real Estate Developers look to fill depleted bench

A strong improvement in the development field has had a significant impact on the growth in overall job postings over the last two quarters. Development firms constituted 17% of all job postings in both of the last two quarters, up from just 7% a year ago. This is a level unseen since the Cornell/SelectLeaders Job Barometer started collecting data in 2007. “May broke all recent records, thanks in part to Full Service Development Firms again posting. SelectLeaders had more jobs posted on the site this May than we had on average in 2007, the benchmark year for job creation in our industry,” said Susan Philips, CEO of SelectLeaders.

Investments and Asset Management firms still represent the largest field hiring in this survey at 25% of postings, but is down from a peak of 32% in Q4 2011. Consulting and Advisory Services were down from 17% to 10%.

Job Function

A similar trend emerges when looking more closely at the functional makeup of the real estate job postings – development roles including project and construction management have expanded significantly over the past three quarters and now comprise almost 10% of all postings in Q1 2013, up from 2% in 2009.

Property Management remains the largest of the 40 job function tracked by the Cornell/SelectLeaders Job Barometer, stabilizing at about 15% of postings. The trend towards increased accounting and control personal has also continued into 2013, with 13% of postings. While asset management roles peaked in 2011, this seems to have tapered off in recent quarters, with only 6.5% of postings in this category in Q1 2013.

Job Sector

Single-family activity is recent front-page news but quietly office is improving with resulting job opportunities. Q1 2013 has seen the trend towards increased job postings in the office sector continue with postings up 3% on the previous quarter. The quarter has also seen the dramatic rise in opportunities in the single-family sector taper off 20% this quarter to total 8% of jobs posted. Whether this represents a maturing of the REO to Rental Initiative or a temporary readjustment remains to be seen.

Multi-Sector, Retail, Multi-family continue to be the three sectors dominating job openings in 2013 as they combine to make up almost 60% of postings. However, the Job Barometer has seen a trend downwards in multi-sector postings – down 15% on an annualized basis. The Retail and Multi-Family Sectors were stable at 20.5% and 17% respectfully.

The Banking sector has continued its fall in Q1 2013 with postings down to 7.5%. This is a significant movement for the sector, which made up 24% of postings in 2010.

Cornell/SelectLeaders Industry Employment Matrix

The Cornell/SelectLeaders Commercial Real Estate Industry Employment Matrix was developed for the Job Barometer as a comprehensive model for organizing jobs within the industry. Organizing jobs within a three-part matrix by sector, business field, and job function not only provides a structure for understanding employment, but also serves as a model for understanding the structure, activity and roles within the commercial real estate industry as a whole.

The Matrix begins with the identification of the 13 broad sectors in the commercial real estate industry. Sector refers to the broader area of the commercial real estate industry within which the position operates. It typically is defined by the product focus of the role. Once the sector has been identified, the position is classified by its business field. The 14 business fields represent the company’s focus, their main line of business. It does not reflect the specific job duties, rather the broader context within which the position is placed.

Job functions truly capture the specificity and diversity of activities and jobs within the industry: A total of 40 distinct commercial real estate job functions are identified. The job function reflects the fundamental job duties that make up a substantial portion of the employment position.

The Cornell/ SelectLeaders Commercial Real Estate Industry Employment Matrix thus provides a structure for understanding activity in the industry and establishes a model for appropriately coding and organizing jobs within the industry.

Baker Program in Real Estate

The Baker Program in Real Estate at Cornell University offers a comprehensive, professional graduate level curriculum that educates the next generation of real estate industry leaders taught by the largest on-campus real estate field faculty in the country. Cornell is also home to the Cornell Real Estate Council, an extensive network of industry leaders, the Cornell Real Estate Review, conferences, research and industry news, and more. Further information regarding the Cornell Program in Real Estate can be found at baker.realestate.cornell.edu. Visit often to discover real estate at Cornell.

About the SelectLeaders Job Barometer

The SelectLeaders Job Barometer, published since 2006, is the foremost survey of employment opportunities, trends, and hiring practices in the commercial real estate industry.

About the SelectLeaders Real Estate Job Network

SelectLeaders powers the Career Centers for 9 premier real estate industry Associations (whose members control or direct 90% of commercial real estate). Jobs are from all sectors and all levels with 29% paying over $100,000. SelectLeaders Job Network offers unequalled access to the Real Estate community. To learn more visit selectleaders.com or visit our Job Network Career Centers: BOMA, CCIM, CREFC, GlobeST.com, NAIOP, NAREIM, NAREIT, NMHC, PREA, Project REAP, ULI, NRHC

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