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The Skills needed in Real Estate in 2024

Blog Posts  (23)

Article posted by Tom Enefer on Apr 02, 2024

The past two years has seen huge change in the skills needed within the real estate space for both graduates looking to get into the sector, and for those with experience and in senior positions across both surveying and analytics-focused roles, as it responds to great changes in demand from both investors and occupants.

Part of our new series with Bayfield Training, fellow Director at Cobalt Maria Sinclair & I put together our 30+ years of experience consulting within the real estate sector to showcase how the skills needed in 2024 and beyond are differing from prior years.

The need for a broader understanding of the real estate spectrum

A significant trend in real estate has been the rise of repositioning properties and the transformation of underperforming sites into booming growth sectors such as PBSA and healthcare. We have seen suppressed demand in traditional sectors including office and retail, but these assets can still present an attractive investment opportunity to investors if they have strong repositioning potential. For candidates, this means that they now need the skill-set to understand investment, and also key concepts around planning and development.

Even within investors who continue to purchase office assets and maintain this use class, there is a need for a very robust ESG strategy for the building in order to maintain its value long-term and maintain its tenants. This also necessitates a degree of cap-ex and transformation of the site. Moreover, we find clients may retain an office asset as is – but still push a development angle by having a gym on the ground floor, as an example, or a retail parade.

So however you frame this, those looking to maximise employability within the real estate market in 2024 need to become comfortable and competent with transformation and modernisation strategies for their assets. They need to be open-minded to consider job opportunities within a range of property sectors, as more assets become diverse and mixed-use to thrive in an ever-change economic landscape. In return, the level of exposure candidates with these skills can receive in this market, can be exceptional.

The importance of financial modelling

The need for candidates to have financial literacy has been important since I joined the recruitment market in 2014. The conventional wisdom is that the financial crisis of 2008 necessitated a much more thorough approach in how real estate is appraised to ensure more realistic IRR’s, and mitigate risk.

But this has only become more and more of a demand from my clients in recent years. In virtually all disciplines I recruit across the Surveying and Analytics spaces, the ability to produce an Excel cashflow, and run either an investment or development appraisal, is a huge plus. With the rising of living assets entering the equation, the need to be strong numerically is greater still – as these are operational assets which require an even greater degree of financial ability to assess.

So how has this affected the recruitment process? I would say that the majority of roles I recruit now involve a case study at some stage, the most common being a cashflow to underwriting a development strategy or a new purchase. The level of challenge really depends on the business type, with real estate private equity being the most challenging, and long-income funds typically having a more measured assessment.

The best way for a candidate to prepare for this is two-fold:

1. Use the resources available in your current role to get more involved in the financial side, i.e raise your hand to get more involved in Excel and try to avoid seeing underwriting as a bad thing

2. Use the resources available outside of work such as modelling courses to boost your ability and get you more comfortable with what an Excel cashflow looks like.

We go into this in greater depth in this upcoming webinar on the benefits of upskilling employees with Excel modelling skills, for both employers and employees.

ESG – more than just a buzzword now

Sustainability has always been part of the sector – the term ‘urban regeneration’ has been a part of the sector for as long as we can remember, but the key difference now is that it’s better legislated and under greater public scrutiny - with the tragic example of the Grenfell Tower Fire, or the RAAC scandal in public sector buildings very much encapsulating just how much urgent work is needed to modernise the qualities of buildings in the UK.

Buildings create about 50% of carbon emissions roughly, depending on source, and with 20-30% being targeted across portfolios, ESG and BREAAM knowledge is featuring more and more on the job descriptions for valuers, property managers and analysts – as well as ESG and BREAAM-specific positions – so much so, we even created our own specific department focused on ESG roles in the Real Estate sector two years ago.

There’s no doubt that this will form part of the future of real estate, even more so than it currently is as regulations and reputation become even bigger factors than they are now.

Elevating your real estate career in 2024 and beyond

The real estate sector and the employees within it have a lot in common. They both need to be adaptable, malleable and broaden into new areas to stay relevant.

For a confidential discussion about your real estate career, please get in touch with us via tenefer@cobaltrecruitment.com / +44(0)20 7478 2512 or Maria Sinclair msinclair@cobaltrecruitment.com / +44(0)161 7111 507

Join Bayfield’s Real Estate Analyst Course on Financial Modelling in Excel on April 18th-19th, where Cobalt’s contacts will receive a 25% discount, or see our upcoming webinars with Bayfield here.