Many of the major development projects previously frozen, especially in the key markets of Moscow and St Petersburg, have been brought back on line. The economy is growing, rents have stabilised and investor confidence is slowly starting to return.

The reality for the real estate recruitment market, however, is that it is lagging behind. The big Russian developers have been the most active as they restart their projects. Even where there has been hiring, however, is has tended to be on a role replacement basis. Much of the activity has focused on back office support positions in Legal and Finance departments or in Project Finance and debt sourcing, rather than in the development or investment fields.

On the plus side, major corporations are looking at Russia as a prime market for expansion, and international retailers are once again on the search for new space. Nevertheless, overall investment activity remains limited, with the market still lacking in significant deals and benchmarks. Those investors that have come in have taken the JV route, and are at initial stages in their growth; earlier this year, Ashmore, a UK based Asset Management business, announced that they would replace Deutsche Bank in a real estate JV with VTB Capital, whilst TFI, a unit of the Qatari Diar Real Estate Investment Company, joined up with Gazprombank.

The return to the market of some semblance of international interest has yet to translate into significant hiring mandates. Russia remains a difficult market to invest in; the paradox of the need to move fast when deals present themselves, coupled with un-transparent property laws and business practices that require careful management and attention to the details, will continue to be a entry barrier for many foreign investors. So too will the difficulty of finding good staff. Even in a market where property professionals outnumber positions available, Cobalt has found itself in demand as the recruitment issue remains the quality, not quantity, of candidates.

Amongst the consultants, the story has been one of solid but unspectacular growth; activity levels are high, but fee income is not what it used to be. Clients are demanding more for less, and their consultants have had to face up to the maxim of short term pain, long term gain. The general consensus is that it will be well into 2012 before anything resembling the lucrative pre-crisis market will materialise, and with it the salaries and bonuses once enjoyed.

One former CEO of a major international property consultancy once said that in the world of Russian real estate, the market is either “on” or it is “off”, with little in between. If we follow this line, then things would have to be said to be “off”. However, with the long term fundamentals of the market remaining strong, coupled with the continued acute shortage of high quality product, the taps could well be back on this time next year. The opportunities for the long term careerists in the market will be significant.

By Gergely Stewart