Finding, motivating and retaining top talent has become essential in today’s highly competitive marketplace.
REAL ESTATE FIRMS CONTINUE to elevate the importance of “getting the right people in the right spots at the right time.” Motivating, rewarding and retaining outstanding talent has become one of real estate CEOs’ top priorities (No. 4 of the top 12). Nearly 60 percent of public and 38 percent of private real estate firms surveyed in the 2015 NAIOP Commercial Real Estate Compensation Survey (conducted by CEL & Associates, Inc.) are now developing formal talent management plans, which may include new recruitment techniques, core competency hiring practices, a robust onboarding process, mentorship, a comprehensive training program, career development, performance scorecards, employee recognition, updated compensation practices and year-round team-building activities. Nearly 67 percent of companies surveyed indicated that they were making improvements to training and leadership development in 2015.
Nearly 77 percent of surveyed real estate firms are having a hard time finding, recruiting and hiring skilled talent. To address this challenge, 73 percent have increased their use of social media, online resources and pregraduation recruiting, and are using recruitment techniques that fit each potential candidate’s needs and expectations. Nearly 56 percent of real estate firms conduct employee satisfaction surveys to independently monitor employee attitudes and satisfaction.
Another area of focus and priority is the creation of succession plans for the company’s CEO/president, all C-suite positions and all “mission critical” positions. Identifying, perfecting, training and mentoring high-potential employees has become a key priority for many boards of directors and CEOs. Nearly 45 percent of real estate firms surveyed are now creating succession plans for non-C-suite positions. Approximately 61 percent “are concerned” about losing key talent, particularly high-potential individuals and successor candidates.
Approximately 92 percent of respondents offer merit increases, while nearly 24 percent are or have recently restructured their annual bonus plan. The current talent shortage in the real estate industry has caused 79 percent to carefully assess increases and allocate greater increases to high performers. Nearly 31 percent are considering adopting or changing talent management policies (for example, work/life balance policies, social responsibility policies, environmental practices and new communication vehicles) to attract and retain millennials. The array of benefits policies designed to enhance the workplace environment, attract talented employees, adapt to employee needs and support company culture continues to grow and spread from large companies to smaller ones.
Faced with higher health care costs, competitor recruiting and a lack of skilled real estate professionals, the industry is faced with a number of critical personnel-related questions, including the following:
- How do I pay more to keep great talent and still produce operating margins that equal or exceed industry standards?
- How do I pay more to get a great professional and then balance the pressure to pay existing, already employed peers the same compensation?
- How much of the significant increase in health care costs do I pass along to each employee?
- How do I manage legacy employees who are not as productive or energized as some of the available younger talent?
As real estate firms look to the new year, it will be important to remember that nothing in the real estate industry gets done — value is not created, nor is success achieved — without great talent. The need to upgrade capabilities in order to remain competitive will mandate a more robust talent management plan. It will also require an empowered human resources director to “get it done.” Planning for and attending to one’s team of talented professionals will be a must in 2016 and beyond. Without talent, success will be an elusive goal.