Commercial real estate firms expect to pick up the pace of hiring this year amid wider market optimism for a rebound in property sales, according to search firm Ferguson Partners.
Some 47% of public and private investment shops and brokerages surveyed by the Chicago-based firm said they plan to increase staffing this year. That’s up from 37% in 2024, when the sector was still grappling with declining property sales.
But like a year ago, the majority of firms — 53% — don’t foresee staffing growth. Fewer shops expect to trim their ranks, with just 13% predicting a workforce decrease, compared with 30% last year. But a greater proportion don’t expect to add staff either, with 40% saying their workforces will stay the same, up from 33%.
“We are seeing a brighter picture, but not yet a 180-degree turn,” Ferguson president Graham Beatty said. Responses from 170 companies were collected through the first week of November for the Ferguson Partners U.S. Real Estate Compensation and Hiring Pulse survey.
Since then, Beatty said there’s been a marked uptick in requests for search assignments. “We are enthusiastic about a more positive environment for 2025, but we are not ready to say that we are going to see a dramatic increase,” he added. “There will be more opportunity, but time will tell whether it will result in a windfall of new searches.”
While final numbers have yet to be tallied, it appears that 2024 was another lackluster year for large property sales amid a still-costly borrowing environment.
“Heading into 2024, firms were optimistic that yearend would be better compared to 2023, when we saw downward pressure on bonus pools,” said Charlie Apfelbach, a managing director in Ferguson’s compensation consulting group. But 2024 “looks to be a similar story.”
Against that backdrop, bonus pools at most firms are expected to be flat for 2024, he said. “Firms recognize it’s challenging to keep employees motivated with back-to-back down years of bonuses, even if warranted by performance. Further, firms are mindful of the competitive market for mid- and junior-level professionals, and are working to reduce pay volatility, particularly for top performers.”
To that end, 61% of private firms and 53% of public companies that use target-based bonus systems said that payouts to staffers — typically distributed during the first quarter — would come in at 95% to 105% of budget.
A quarter of private firms said that their bonuses would be below expectations (75% to 94% of target), while another 7% said that they would be significantly below (less than 75% of target). Just 7% said the payouts would be above or significantly above target.
Staffers at public companies likely will fare better, with 29% of those entities saying bonuses will be above or significantly above target, while just 18% see payouts coming in below or significantly below target.
Last year, more firms reported that the number of staffers departing voluntarily remained flat. Some 58% of reporting firms said they saw no change, versus 49% in the prior year. Roughly a fifth said they saw a decrease in resignations, versus 32% a year earlier.
While questions remain about the pace at which the Federal Reserve will continue lowering interest rates and the fate of U.S. Treasury bond yields, the consensus is that the sales market will show some improvement in the year ahead. That likely will create job-hopping opportunities for real estate pros.
Demand is expected to be centered on the most popular property types, but it also could include select assignments focused on out-of favor asset classes as more investors search for yield, Beatty said.
“There is more of a strategic shift toward operating in an environment that is different than the historic low [interest-rate] environment,” he said.
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