Cobalt news
A view from the front line in property recruitment
Timothy Rowe
14/03/2008
As specialist recruiters in the real estate market, on a global basis, many people ask us for our views on the market and where it is going, not just in terms of the trends in human capital but also a more macro view of the market. Whilst the cheeky answer is tell them that we will recruit them a sector research specialist to answer that very question, in a fully analytical way, we do understand that due to our broad involvement with the industry we are able to offer an interesting incite into it. We clearly see our client’s appetite for expansion through their recruitment plans and their sentiment towards new geographies and sectors for the same reasons. In developing new business areas the first initiative for a client is to recruit a senior individual or team in order to enable them to fulfil their business plans. By the same token we also hear from candidates when their roles or organisations are in decline, or worse when they are the victim of downsizing.
Despite the current mixed sentiment in the market we have not seen redundancies on any material scale except in the CMBS/credit markets. The current blockage in the finance market means that the investment banks are having to deal with their existing exposures rather than develop new lending business and therefore there is a downsizing in those teams that are hit hardest. Apart from that area we are not seeing a significant amount of fallout, however we are finding good quality candidates are more open to hearing about new opportunities, of which there are many. This is an encouraging change as there has been a dearth of supply of talented individuals in the last few years.
Rather than being despondent about the real estate sector many of the more successful and significant organisations in the sector are seeing that the readjustment in the market (as some are calling it) as an opportunity rather than a threat. Whilst the ability to do deals is limited by the decrease in the level of debt available out there, those that have strong equity reserves or sources of equity and well established banking relationships are actively doing business in an environment where pricing is becoming more realistic. Falling values of investment grade assets is clearly creating opportunities, and after a period of yields matching borrowing costs there is an arbitrage opportunity again in some situations. For us this means that those active clients are looking to hire well established investment professionals who can realise the business opportunities that they have been identified.
Equity sources have changed and the sovereign fund driven investors are active recruiters in this market for obvious reasons. This investment is not exclusively on the direct investment side, we are also finding that there are requirements for investors and asset managers on the distressed debt side where investors are also again becoming active. Our banking teams are able to source experienced professionals from across the world and take advantage of the experience that has been established in different markets, notably Asia, over the last decade. That is the great advantage of working in a global market that works in different cycles.
Various property development markets are in full swing particularly in the emerging markets, where Cobalt are very active, and many clients are very confident for the medium term prospects of the market, so we are not seeing many schemes being put on ice. The other area that is probably on balance a beneficiary of the new market sentiment is the asset management side, where the requirements for high quality property professionals is very much active in order to sweat the assets in our clients portfolios and drive returns.
That is the view from the front line in property recruitment, you asked!...