In this ever-evolving environment, we are seeing continuing demand for interim leaders to fill specific functions at senior levels across the real estate industry. 11% of all UK senior interim placements in the past year have been within the property / construction / real estate industry (Institute of Interim Management, 2023).
Traditionally, interim hires haven’t been commonplace in our sector, but things are changing. For organisations grappling with a senior exit, a new strategy to implement or just a rapid stage of growth and development, a short-term expert with the experience to jump in and lead can deliver substantial benefits. In the past year, we have seen the requirement for interim c-suite operational and financial roles increase.
Interim leaders have a defined function, with specific delivery objectives within a set amount of time. The combination of tangibility and flexibility can be very attractive for senior real estate executives, not to mention lucrative. Companies benefit not only from an experienced talent delivering specific goals, but skills that they can transfer to the team. Significantly, these leaders are often uniquely objective and can bring a vital dose of neutrality to teams and situations.
Our clients have particularly benefitted from this when expanding specific capabilities or developing their presence in new areas. Short-term, senior consultants can check the viability of projects or expansion with less financial risk. Covering maternity and, increasingly, paternity leave for six months or more is also beneficial when the work cannot be covered effectively internally.
Experience is the key requirement, so the average age of interim hires tends to be higher than those of their permanent counterparts. According to the Institute of Interim Management 2023 Survey, 68% of interim managers are between 40 and 60. With an uncertain market prevailing, we expect the need for senior interim hires to remain high within the real estate business. If you are interested in discussing interim options for your leadership team, please do get in touch.
Tom McNally co-founded Madison Lincoln in 2020, having identified a need for a boutique real estate executive search firm that delivers material value to organisations.
Because many real estate companies are ‘waiting and seeing’, there’s a danger they won’t be prepared when things start to pick up. The problem is that we’ll see many firms get into a pattern of ‘desperate recruitment: they need to hire someone and quickly, choosing from a pool of available candidates rather than headhunting the best person for the job. As a result, they could be repeating the same process within the year.
The minimum time to hire senior talent is five months. Companies should be planning by looking at succession forecasting, talent loss and mapping who’s in the market.
Leadership means something different today than it did 20 years ago. The ability to connect with others and lead in a more collaborative way will continue to be essential. Tech skills will become increasingly important for those taking on senior roles in our industry.
With a degree in Finance and Business, the aim was always to get into accountancy or banking. I worked at JP Morgan after graduating and was spending too much time on Excel for my liking, so I started to think about other industries. I decided on recruitment and began to think about which sector would be most interesting. Real Estate appealed because you can tangibly see the fruits of someone’s labour. For example, when I place a Development Director it’s then incredibly exciting to see the resulting buildings and schemes.
Everyone calls it executive search, but we see ourselves as a retained business partner. We have a unique insight into the nuances of our clients’ businesses and the roles they need to develop and fill. This means we can communicate the opportunities to candidates more effectively and attract the right people for the business.
I started a renewables desk 12 years ago when it was in its infancy, placing people within solar, wind and wave power. Recent Government pressure has created a huge demand for renewables, generating a huge opportunity for us with both extensive real estate and renewables experience.
We’re going to see new teams with varied experience to harness the opportunities of renewables, hiring from different sectors. This will change the face of the real estate industry which, up until recently, has been very traditional. These will be very exciting times.
McKinsey estimates that by 2026, global renewable-electricity capacity will rise more than 80 percent from 2020 levels, two-thirds of which will come from wind and solar.
It’s not just oil and gas companies shifting their strategies in response; institutional investors and players in manufacturing, shipping and private-equity are making renewable energy a significant element of their investment strategies. During a PERE Logistics webinar in September 2022, attendees’ renewable energy investments were focused on two areas: Solar (86%) and electric vehicle charging (14%).
Some of the biggest challenges are not only identifying and securing the land required to develop and invest in, but also acquiring these assets at speed. Land sites previously earmarked for residential or industrial purposes are being aggressively targeted by renewables investor and developers.
A skills and labour shortage may curb those organisations wishing to maximise the opportunities that new energy investments bring. 33 per cent of UK workers are at least somewhat likely to leave their current companies in the next three to six months*. The UK renewables market needs thousands of workers, at every level, to deliver on their targets.
A new mix of experience and skills are required. Investors and developers need Real Estate expertise to secure and manage assets, plus energy and infrastructure experience to ensure innovation and robust energy production.
Our founder, Tom, set up a renewables and infrastructure recruitment desk 12 years ago and has a solid track record in building multi-faceted teams with the capability and skills to deliver on new energy investments. This includes experience in attracting talent from infrastructure and private equity companies into real estate and vice-versa.
If you would like to discuss attracting senior talent into a renewables role, get in touch.
*McKinsey Quarterly, July 2022: “The Great Attrition is making hiring harder. Are you searching the right talent pools?”
Both the Build to Rent (BtR) and purpose-built student accommodation (PBSA) sectors remain resolutely buoyant. Annual investment in UK living real estate was a record £18bn in 2022* and investor appetite shows little sign of flagging.
Investors and developers are increasingly turning their attention to the UK living sector in a less certain real estate market because of its defensive nature and resistance to economic cycles. BtR represented 35% of investment in UK living real estate in 2022, with transactions expected to accelerate again in H2 2023 (JLL). For PBSA, current occupancy is at record levels and expected to endure, delivering strong rental and income growth in turbulent period.
PBSA and BtR are emerging as resilient and attractive asset classes for investors because they:
Demand for both high-quality, professionally managed homes and student accommodation in the UK remains high, yet new supply is still not meeting demand. According to StuRents, the UK’s largest student rental service, there will be a shortfall of approx.450,000 student beds by 2025, while the UK rental shortage has been well-documented in recent years. Student accommodation accounted for 45% of investment in UK living sectors in 2022
While investor demand has slowed because of development viability against a backdrop of debt considerations and construction challenges, the market is anticipating a significant upturn in the second half of 2023. Recently, we have seen large deals and significant market activity, such as GIC and Greystar’s recent acquisition of Student Roost, driving current and future activity.
We are actively hiring senior, leadership roles as our clients across the living sector seek experienced c-level executives to pilot this next stage of growth. Please do get in touch if you would like to discuss shaping your recruitment strategy.
Whilst it’s undeniable that the real estate market is suffering the consequences of higher interest rates and economic decline, analysts expect an upturn in property deals later this year*.
This can be a dangerous time for organisations that don’t have a plan to withstand these challenges with the best talent. Often, HR mistakes are made in these periods that may solve a short-term issue but don’t support successful teams long-term.
Key considerations should be:
What’s the plan?
Given how long it can take to recruit a senior executive (a year is not unheard of), developing a three to five-year recruitment plan that supports your business objectives is vital. Who are the people you need in your business? How can you develop the required talent?
What are the risks?
We encourage clients to undertake a mapping process that assesses risk in their workforce. Identify where you could lose potential talent and which skills will be in demand over a longer period. What are the consequences of not meeting future demand from clients or stakeholders?
Plan for eventualities
This mapping process allows businesses to develop contingencies to mitigate the risks identified. We work with companies on strategies that include succession planning, interim talent, and long-term recruitment pipelines. Every business should know their next hire before a resignation or new business comes in. Be prepared!
Who do you want to attract?
Who do you want to attract to your future workforce and how will you do it? We help clients understand what makes a company attractive to strong candidates. Develop your employer value proposition and identify areas for improvement. Many companies are looking at diversity, equity and inclusion targets over the next few years, as well as ‘softer’ issues such as company culture. Madison Lincoln works with real estate companies to develop lasting recruitment strategies and create a rewarding process for the candidates we engage with on their behalf. To find out more, get in touch.
Whilst economic pressures will inevitably impact the real estate market over the months ahead, a guiding star, in the form of the construction sector, is expected to remain relatively buoyant.
ONS* reports that September 2022 showed the highest level of construction output (£15,125 m) since records began in January 2010, despite facing multiple challenges. Although the RICS agrees that construction output is around 6% up on a year ago and 2.5% above pre-pandemic levels, activity does appear to be slowing. The Q3 RICS Construction Monitor** cites upskilling the workforce as the key approach to lifting productivity over the next twelve months.
Developers tell us that robust assets in desirable locations continue to attract funding, adding to an already impressive pipeline for many. To drive this growth, we work with developers to bolster their leadership so that they can build the all-important teams they need to ensure a skilled and experienced workforce.
In addition, the UK construction industry is expected evolve, according to Glenigan***, with areas of growth expected to be in residential (build to rent and single family), life sciences, warehousing & logistics, office refurbishment and fit out, driven by net zero energy use legislation. Meanwhile, increased Government funding will galvanise the education, health, civil engineering and community & amenity sectors. It’s an exciting time working with companies on their recruitment strategies to ensure they can exploit these emerging opportunities with the best individuals at the helm.
Many construction organisations have driven huge cultural change over the past few years with diversity and inclusion at the heart of their recruitment policies. This purpose is reflected in our own business, enabling us to connect with the candidates our clients want to attract more effectively. We specialise in actively encouraging senior candidates from under-represented groups, resulting in impressive shortlists that meet the brief.
If you’re looking to make a senior hire for your real estate business and want to benefit from our extensive industry experience, get in touch.
*Office for National Statistics. ‘Construction output in Great Britain: September 2022, new orders and Construction Output Price Indices, July to September 2022’
**RICS UK Construction and Infrastructure Survey, Q3 2022
***Construction Industry Forecast 2023-2024 for the UK and Republic of Ireland, Glenigan
The #IAMWOMAN campaign is a joint effort between our sister company Madison Berkeley and Black Women in Real Estate (BWRE) to attract more young black females into the real estate sector and retain them.
“The real estate industry has terrible female representation generally” says Nina Zeilerbauer, board director of Madison Lincoln and co-founder of real estate recruitment firm Madison Berkeley. “It stands at just 13%. Our industry is white, middle class and overwhelmingly male and we are working with Hanna Afolabi founder of BWRE (Black Women in Real Estate) to attract a more diverse workforce into our industry. Without it, the sector will stagnate because companies want a diverse workforce, but there are so few candidates who meet that criteria.”
Each day this week the #IAMWOMAN campaign run by @BWRE and @MadisonBerkeley will share a young #womenofcolour’s journey into the UK #realestate industry. How they got there, what they do, why they love it and most importantly how you can do it too.
To follow the campaign, please go to https://www.madisonberkeley.com/i-am-woman/ and https://www.bwre.org/
For International Women’s Day 2022, Board Director Nina Zeilerbauer was interviewed by The Guardian to discuss gender bias, discrimination and stereotyping plus how to improve gender equality in the workplace. Nina discusses these issues from a real estate point of view - Read Here
For more information, on exploring diversity and inclusion focused recruitment campaigns within real estate, please email info@madisonlincoln.com
In the article, Nina talks about the current state of play, what more can be done and shares a number of interesting statistics and facts.
For more information, on exploring diversity and inclusion focused searches within real estate, please email info@madisonlincoln.com
For 2021 and 2022, Madison Lincoln would like to support Tiny Tickers, a charity that is very close to the heart of one of our board members Clare Coe.
A London newspaper recently picked up Clare’s story (https://www.mylondon.news/news/health/london-mum-dads-final-kiss-20973106) and we would like to continue to increase awareness of the charity which aims to improve the early detection and care of babies with serious heart conditions.
Furthermore, here are two links of two fundraising events to help raise funds for the charity.
