Capital raisers, repositioning experts and executives in emerging operational asset classes are the professionals most in demand in the property sector – and as a result are seeing the most upward pressure on their remuneration packages.
That is the verdict from executive head-hunter Bohill Partners’ latest Compensation Review.
Those in charge of raising equity are in particular demand, as fund mangers look to swell their coffers ahead of any downturn and lowering of prices. Development experts that are able to reposition distressed retail assets are also coming to the fore, as more investors target the distressed sector, while the few professionals who have true experience in emerging asset classes such as co-living and co-working are being sought out as buyers look to diversify away from traditional sectors.
“The demand for development professionals is not so much for speculative development but for those within asset management firms that can undertake redevelopment or repositioning,” says Bohill partner Thomas Hughes.
“This often means turning shopping centres into mixed-used assets with lots of residential. There is a persistent demand for development director-level people who can do this in the UK as well as across Europe.
“Development capabilities as well as operational capabilities are needed, too, in alternative asset classes such as co-working and co-living, as well as student accommodation and hotels, as those markets mature. There is still masses of demand for capital raisers at every level but there is particular demand for ‘strong number twos’ as a lot of those in the top jobs moved last year and are now on the lookout.”
Managers of individual funds have arguably seen the least upward pressure on salaries. There are several reasons for this, including corporate activity resulting in the merging of funds and (in some cases) fewer roles, an increasing focus on core rather than opportunistic funds and the character profile of those in the industry, according to Hughes.
“A lack of changing of seats suggests salaries are more likely to be flat. The actual fund manger role has seen the least amount of movement. They tend to be quite stable folks and often stay in situ for a while. There has also been an increasing focus on core and core-plus, which (outside the biggest names in the industry) tends to be a space that sees lower total compensation than opportunistic.”
Hughes estimated that remuneration gains had been normal to modest (around 5%) across the industry, but that Brexit had not affected recruitment decision making at the top level. Some employees, however, have taken relatively conservative approaches to their remuneration requests when taking new jobs, with a greater focus on salary and less on bonus.
“Brexit has not made a material impact and there is the same amount of caution on decision making as there ever has been. People think it is late cycle but we don’t see people not making decisions to hire an investment professional or fund manger or strong asset manager. They tend to need people in their businesses now – or they will miss an opportunity,” he says.
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