This summer, the M5 hard shoulder around Bristol was full of breakdowns. Hazard lights flashing, faces glum, holiday-making families gathered behind the crash barrier waiting for the rescue van to pick them up. What terrible luck, you mutter, whizzing past.
Bad luck? Well, maybe not. According to the motoring organisations, the surge in holiday breakdowns was not due to engine failures or overheating, but to a lack of petrol. Drivers didn’t put enough in their tank, and when the fuel dial showed red, they carried on regardless, assuming there was plenty left.
There’s a lesson in there – and one that is not lost on senior figures in Bristol’s office scene. Quite simply, they fear their market might also be running in the red zone. And what it’s running out of is the most basic fuel in the property business – talented professionals.
Today, the shortage has pushed wages for some (lucky) senior surveyors up by 30%. Trying to recruit a planner is like looking for hen’s teeth – money can’t really help, because there aren’t any around. If a landlord and tenant specialist is what you want, perhaps you should just save yourself six months of agony and give up now.
In every branch of the property profession, clients, professional firms and recruitment consultants agree that the supply of talent is beginning to look like a real constraint on the market.
Ron Persaud, co-founder of Change Capital, is the developer behind Bristol’s Redcliffe Quarter (pictured), where a 600,000 sq ft second phase is due to be unveiled any day now. He points to a shortage of professionals in both the public and private sector.
“Council planning departments have been starved of resources at a time when there is lots of development activity, and that causes issues,” he says. “And in the private sector, consultancies are also taking on staff, and that puts the local authorities in a difficult position.”
The shortage of professionals comes at the worst possible time. Although office take-up in the first half of 2015 was a shade down on the record-breaking first half of 2014 (250,000 sq ft, says DTZ), the consensus is that the market is still fizzing. There is a development pipeline of about 400,000 sq ft waiting to go (“fingers on the trigger,” says JLL), with a further 200,000 sq ft waiting to see what happens and 500,000 sq ft expected to deliver in the next three to five years.
Meanwhile, there is eight months to go before the temporary permitted development right to convert office to residential comes to an end – which means developers are working fast to get in ahead of the May 2016 deadline. That’s a lot of work for a small pool of professionals and it puts particular pressure on planners (see panel below).
Rupert Stuart-Baker, Bristol-based director at Beach Baker Property Recruitment, says: “It’s very difficult to find the right people. There’s a real shortage of senior surveyors because so few people moved into the profession during the recession, so there are few to promote. We’ve seen a surveyor, two years post-qualification, being offered £40,000 – way above the £32,000-£34,000 you might expect, which is good money.
“It’s very hard to recruit in valuation, commercial property management, landlord and tenant, and agency is getting tougher. Often the only place to recruit for the private sector is from the public sector. I’ve placed property management and landlord/tenant people from Bath & North Somerset council and Bristol back into the private sector.”
Across the board – all specialisms, all disciplines – property professionals’ salary offers are up about 10% compared with late 2013, says Stuart-Baker.
The big consultancies are recruiting furiously in an effort to keep up with client demand. Turner & Townsend has upped its Bristol headcount by 20% in the past year, despite acknowledging a skills shortage. Architect Stride Treglown has grown its Bristol team to 150 – and is still recruiting – and says it is approaching its capacity. Bilfinger GVA’s Bristol headcount is up 10% in 12 months.
Jo Davis, regional senior director at GVA, says: “There is a problem of capacity – not just in Bristol, but throughout the South West. It’s a problem at the local councils, where they let staff go during the recession when the planning department wasn’t busy, and now cannot rebuild those teams quickly enough to keep up with the market.
“The private sector isn’t helping because it is re-staffing too, sometimes recruiting from councils, while fighting off competition from clients who are also growing and are recruiting from us. It’s not just councils being squeezed. The effect for the private sector is that wages are going up sharply.”
Ian Wills, director at JLL, says rival firms are poaching good staff. “There’s lots of it happening,” he says. “There’s been an issue for some time about council planning departments, under-resourced and over-stretched, and the potential conversion of 1.5m sq ft of office space into residential has added to an already-busy case load for them.
“At the same time, the return of demand in the offices market happened more quickly than the resources to cope with it. Professional businesses are still cautious about taking on staff.”
Andy Heath, head of office agency in Bristol at Cushman & Wakefield, says: “Anybody in Bristol who is a senior surveyor or above, and is good and knows it, can demand outrageous sums. We’re seeing newly-qualified surveyors looking to the high £30,000s.”
The big property firms contacted by Estates Gazette – from planners and engineers to architects and surveyors – all say they are interviewing more applicants from outside their home turf (the South West and south Wales). One firm has been talking to people in Dublin, and many more to Londoners.
But London escapees are not seen as the solution. “They don’t have the local contacts, so frankly they are always second choice,” says one insider. “They come here not realising it’s expensive to live here, too, and often their salary expectations are way out,” says another.
The Bristol office market is revving, and developers have their foot on the accelerator. But the tank? Whether there’s enough talent in there to get things moving is, for now, unclear.
Planning for trouble?
Bristol city council rejects claims that it does not have enough planners, which is holding back the office market.
Assistant mayor Simon Cook says: “There have been no cuts to the planning department over the past three years and we have actually created two additional senior job roles this year.
“There was a period when we struggled to recruit for three positions this year, but we filled the gaps using consultants and agency staff and these positions have now been filled.
“We are confident that our planning department has the resources it needs to deal with all applications.”
Some observers say the city’s property business should examine its own record before it blames the council. Peter White, former BNP Paribas Real Estate director, now at planning consultant Origin 3, says: “Planning delivery does not impact on the process. The limited amount of key sites is the real issue. Bristol has never been good at spec building.”
Planning to grow
The shortage of planners is drawing new private-sector entrants to the Bristol market. Planning Potential, a 30-strong Southwark-based business, opened a new office in Bristol in August, run by Dan Templeton and Alan Williams, and is already expanding. “We have another joining next week,” says Templeton.
“The supply of planners is tight, and as we grow, I wonder where the new recruits will come from.”
