Generalize, don't specialize. That's the credo being heard throughout the real estate industry today as a back-to-basics approach to management is resulting in a new crop of real estate generalists.
Downward trends in empowerment, decision-making at the "lowest" functional levels, and increased involvement in corporate goals make it more important than ever for real estate professionals to have a generalist's background and education. As companies continue to merge, expand and diversify, the role of the asset manager is gradually disappearing, resulting in property managers assuming a broader spectrum of responsibilities.
Perhaps there is no more important job function for today's real estate generalists than building connectivity, or what Kevin Kelly, author of New Rules for the New Economy, refers to as "relationship technology."
As Kelly notes, "Nowadays talk is cheap. Knowledge is becoming commoditized; it's difficult to add value when news and strategies are readily available on the Internet without a charge. What becomes more valuable are things that can't be copied - like attention, trust, integrity, experience and knowledge. Firsthand knowledge of the client's situation is the value that you bring to the table."
In today's environment, portfolios turn and churn. It's not the property specialty that matters but how managers create value for the real estate investment that really counts. Very simply, today's real estate practitioners recognize that they can't afford to spend their time on things that don't add value.
Owners and investors are no longer looking for individuals who are highly specialized, who only focus on specific product types in specific market
areas. The aim is to become a generalist, a CEO of the property. They want people whose careers are tied to the performance of the particular asset they're managing and nowhere else.
The traditional functions of management and leasing have given way to a greater responsibility for the entire asset. The industry is leaning toward an approach of general management, that is, on-site expertise at each property that can provide a variety of sophisticated business initiatives on behalf of the investment community. Generalists are needed who can be in charge of client and tenant relations, operations, personnel, financial controls and marketing.
Real estate professionals need to broaden rather than narrow their base of skills to match the diversity of services being offered to clients of today's large real estate organizations. Employers are looking for people with broad-based education and experience.
Obtaining technical skills in such areas as due diligence, asset management, financing, valuation strategies, performance measurement and strategic investment analysis are all at the top of today's managers' learning to-do list.
In order to make value-enhancing decisions, today's real estate professionals must know how to gather data, understand its implications and develop their own conclusions that will work for the real estate investment. An emphasis on benchmarks and comparing not just property against property, but property performance against other portfolios such as stocks and bonds or REITs will have raised the level of analytical skills needed for property and asset managers.
However, "soft" skills such as leadership, time management and culture programs aimed at teaching real estate professionals about the company's goals and objectives are equally important.
As Mark Skiff, director of management services for Grubb & Ellis Management Services, suggested during a recent IREM-sponsored Education Leadership Forum, "Business writing, leadership and marketing for non-sales professionals are all areas that will come more into focus."
Today's real estate practitioners must be technologically savvy and willing to constantly update their education. Someone whose education is three years old in today's environment may need to update his/her skills.
The Institute of Real Estate Management has responded to this need for a variety of education through its flexible and convenient education program. Real estate practitioners can choose from 24 courses in either a one- or two-day format or one of seven series of courses for a sustained educational experience.
In this way, real estate managers can select the education that they need most to build their personal portfolio of value-added skills. Courses cover a broad range of topics and skills from asset management, legal issues and risk management, to maintenance, marketing and financial operations, as well as business development.
Above all, today's real estate generalists need to be excellent communicators. Owners' and investors' motivations have changed, and real estate practitioners must change with them. Real estate managers need to know how to work in a team context required in today's more sophisticated, strategic and tactical approach to ownership.