Getting and Keeping the Right Team Remains No. 1
By: Christopher Lee, president and CEO, CEL & Associates, Inc.
In today’s highly competitive and transforming marketplace, the recruitment, retention and recognition of contributions made by talented professionals remains the No. 1 priority for real estate companies nationwide. That is one of the key takeaways from the recently released “2014 NAIOP Commercial Real Estate Compensation Survey,” completed in partnership with CEL & Associates, Inc.
The increasing recognition that talent can and will create a strategic and competitive advantage has renewed efforts to attract, retain and reward exceptional performers. Real estate companies across the U.S. are dev-eloping robust talent management plans, revitalizing their outdated compensation plans and expanding their internal resources to create an aligned and motivated workforce. Real estate firms are reaching out to hospitality, tech and retail firms to find human resource leaders who can bring energy, change and alignment within the organization. Bridging the growing generational gap while remaining successful in a very competitive environment are additional drivers, beyond getting the right team in place.
Building careers has been replaced by building income security, as employees in the real estate industry shift from the attitude of “it’s a job,” to “it’s a financial opportunity.” While many real estate firms struggle to find the perfect candidates, recruiting, retaining and motivating a collaborative workforce has become an essential core strategy in 2014-2015. A growing number of real estate firms are seeking talent from outside the industry, utilizing a variety of social media platforms (including LinkedIn and others), deploying assessment profiles and streamlining resume screening processes. Employee referrals, industry networking, use of career centers (such as Select Leaders) and strategic partner recommendations remain popular.
In addition to finding new talent, real estate firms continue to enhance and upgrade their talent management programs. A renewed focus on professional development, training for next-generation leaders, mentorship and incorporating a more enterprise-based compensation plan are important actions that many firms are taking to achieve a competitive advantage. In addition, succession planning is becoming an integral part of the strategic planning process for best-in-class firms. Over the next five to seven years, survey data indicates that many real estate firms will experience a significant transition, from founder-based leaders to next-generation leaders. As a result, compensation administration and compensation plan design are becoming strategic priorities. Getting the right people in the right spots at the right time will be an ongoing theme for many real estate companies.
Median base salaries for commercial positions in 2014 ranged from a low of $42,100 for an entry-level retail maintenance engineer/technician to a high of $555,600 for a chief executive officer. The 10 positions posting the largest projected salary changes, for the 75th percentile, between 2013 and 2015 (projected) are shown in Table 1. Average merit increases provided by surveyed companies ranged from 2.8 to 3.1 percent between 2011 and 2013; while companies reported an average 2.9 percent merit increase for 2014 and a projected increase of 3.1 percent for 2015 (Table 2).
More than 400 companies participated in this year’s compensation and benefits survey, which was conducted in the second quarter of 2014. These firms represented more than 120,000 distinct jobs across the office, industrial, retail and residential sectors of private and public companies throughout the U.S.