After a Bleak Year, Hiring Starts to Perk Up
Executive recruiters are starting to see a pick up in hiring following one of the most dismal years on record in the commercial real estate industry.
Business plummeted last year at firms specializing in retained searches, as real estate companies continued to consolidate operations amid the deep market slump. But the trend started to reverse over the past few months as the sales market perked up a bit. Some search firms report that assignments are up at least 50% from the lows of last year, according to Real Estate Alert's annual review of recruiting firms, which identified 33 companies that actively place real estate executives (see list on Page 9).
Still, hiring is nowhere near the level during the market peak, and recruiters don't expect activity to stabilize until roughly 2012. "It's an increase over 2009, but we are still looking for it to get back to the more aggressive levels of years past," said Jon Boba, president of Chicago-based Christenson Advisors.
The punishing real estate downturn forced recruiting firms into their own rounds of layoffs and consolidation. But with signs that the market is at or near the bottom, recruiters are dusting off expansion plans and looking to increase staff. Among them: BCGI Real Estate Executive Search of New York, Korn/Ferry International of Los Angeles, Sousou Partners of New York and Terra Search Partners of San Francisco.
When the market soured, BCGI suspended plans to add recruiters. But now, "we'll definitely be expanding by the end of this year," said president Robert Baron.
Likewise, Terra Search is eyeing new markets. It opened a Los Angeles office several months ago, to complement its outposts in San Francisco and Seattle. "We're thinking of other [locations] that would work for us as well," said Matt Slepin, a co-founder and managing partner at Terra Search.
Meanwhile, Korn/Ferry plans to continue adding recruiters as it builds a global real estate team. The firm has handled some real estate assignments in the past, but at the beginning of the year it hired Anthony LoPinto, who formerly led search firm Equinox Partners of New York, to focus on that area of its practice.
The recent pickup in search assignments coincides with the uptick in sales activity. The assignments are coming from real estate firms looking to fill positions left vacant during the downturn or to beef up their bench strength, as well as from companies looking to jump into the market. "People were expecting new ventures to start up last year, and a lot of them didn't," said Jennifer Novack, a managing director of Sousou. "But they have started up now."