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Saturday, Jul 13, 2024

Women Execs Face Obstacles in Commercial Real Estate Career

While their counterparts on the residential side have attained near parity with men when it comes to filling the ranks of upper management, that level of corporate leadership remains the unbroken glass ceiling for most women in commercial real estate brokerage.

That’s the gist of a recent national survey report by the listings platform CommercialCafé, which queried more than 200 management employees across 11 commercial and eight residential brokerage companies.

One clear trend found by analysts was that men outnumber women — 51 percent to 49 percent — in executive positions considered upper management in residential real estate. By contrast, the gender gap in commercial real estate is much wider — 86 percent to 14 percent in favor of men.

CommercialCafé is a nationwide commercial real estate listings platform that is part of Santa Barbara-based Yardi Systems, a provider of data services and technology with regional operations in San Diego.

Seniority Issue

Corina Tarta, lead analyst for CommercialCafé, said researchers sought to determine whether trends identified in an earlier New York City-focused survey, by the regional real estate publication The Real Deal, would be borne out on a national basis.

For the most part, they were, and a big reason is that top-tier commercial real estate positions are selected based on seniority or experience, in an industry that for several decades has mostly employed men. But there is reason for optimism that top-management opportunities for women are poised to improve steadily in coming years.

One indicator, the CommercialCafé study found, is that women significantly outnumber men in middle management — 67 percent vs. 33 percent — among the commercial brokerages surveyed. In residential real estate, middle management favors men, 52 percent to 48 percent.

“With women pushing into middle management (in commercial real estate), it is more likely they will be the roster from which the next generation of leaders will be chosen for promotion,” Tarta said via email.

Tarta said based on respondents’ comments, there are several reasons why commercial real estate currently has a much wider, male-favored gender gap in upper management than its residential counterpart.

“Some of the nation’s most prestigious CRE companies were founded back when many women were still barely entering the labor market, so gaining experience in the much more long-term deal-making of the commercial sector was more difficult,” Tarta said. There were also lingering biases, associating women more easily with seeking a home than setting up a business.

Tarta and other local observers note that the commercial brokerage industry has undergone significant change in recent years, as more women have become business operators and ultimately the decision makers when it comes to matters such as office locations and property acquisitions.

For instance, the Chicago-based brokerage firm JLL, which employs more than 200 in San Diego County and 70,000 worldwide, recently reported that 39 percent of its global executive workforce is female, along with 36 percent of its board of directors, led by Chairman Sheila Penrose.

Misty Moore, an executive vice president in JLL’s San Diego office, said women are represented prominently in all of the major sectors the company serves locally, including tenant representation, capital investment and property management.

Barriers to Re-entry

A nearly 20-year veteran of commercial real estate, Moore said the industry is much faster paced, with bigger deals and other higher stakes than what is seen in residential real estate. The requirements for deal productivity, and tending to multiple ongoing requirements of corporate clients, makes it a much tougher industry for women to return to once they have stepped away to raise a family or make some other type of lifestyle change.

That impacts retention and seniority, and ultimately the ability of women to enter the upper echelons of management at brokerage firms. Moore said JLL maintains a culture and priority system that allowed her to rise at the company while also having children. But with the exception of a few other firms, such as CBRE Group Inc., the commercial brokerage industry as a whole still has not made the necessary pivots that would help narrow the gender gap in upper management.

“It really comes down to companies changing their culture and providing the support to women as they are coming up through the ranks,” Moore said. “There needs to be more of a supportive team approach, and I think we have one here at JLL.”

In its own 2016 national study, the Kansas-based Commercial Real Estate Women Network (CREW), which has a San Diego chapter and more than 10,000 members worldwide, pointed to two other gaps impacting women’s career advancement prospects, related to compensation and aspiration.

CREW’s white-paper research study, including comments from more than 1,000 industry professionals, found that 28 percent of women aspire to the C-suite, versus 40 percent of men.

In the realm of pay, CREW found that the industry median annual compensation as of 2015 was $115,000 for women and $150,000 for men – an average income gap of 23.3 percent. The income gap was widest in the C-suite, at 29.8 percent.

One in five women surveyed said that family or marital status has adversely impacted their career or compensation.

Lack of Mentorships

CREW also referenced its 2015 national benchmark study, in which women ranked the lack of mentorship within their company as the No. 1 barrier to success, “scoring the importance of continuing to focus on mentors and sponsors.”


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