[Illinois Real Estate Journal, February/March 2022]
With an estimated value of $33 trillion at the end of 2020 and a projected growth of 4-5% per year through 2030, the commercial real estate industry is global, growing quickly, changing rapidly and becoming more complex and diverse, which requires more professionals than ever before. New ways to finance investments, expanded inclusion of property technologies, and incorporation of data analytics and transaction analysis have emerged. Initiatives such as environmental, social and governance (ESG) and green building strategies are also elevating the industry.
So, to say the industry is in a dynamic growth mode is an understatement. This presents a number of exciting opportunities for not only those who are new to the industry, but also seasoned commercial real estate (CRE) professionals, especially those looking to make a pivot in their CRE career. Whether someone with a technical background like an architect is looking to switch to a career as a real estate developer, or professionals in accounting, marketing, and more “general” finance for a real estate firm are looking to support broader career growth in the industry, one of best ways for them to understand and gain knowledge about the “other side” of their new CRE path is to obtain a Master of Science in Real Estate (MSRE).
Regardless of their role, CRE professionals should be comfortable with the industry’s terminology and concepts and how they apply to developers, investors, financiers, brokers and property managers. A MSRE provides not only the basic knowledge for understanding the business side of commercial real estate, but more importantly, it also equips CRE professionals to meet the new challenges of the industry. A deep understanding of market dynamics prepares a CRE professional to respond quickly and confidently, which can make the difference between getting a transaction done and missing out, whether that be a sale, purchase, lease or financing. While understanding the importance of issues like ESG and how they apply to developments and existing properties may be the edge a CRE professional needs in the competition for capital and tenants.
Many CRE professionals have been fortunate to have a great mentor in the workplace, which can certainly help someone learn the industry. I know I did, and I’ll always be thankful to my mentors: Steve Smith, Carlos Hodge and Michael Welborn. But I believe the stronger and more direct path to comprehensive CRE knowledge can be achieved through courses taught by industry leaders skilled in the best practices within the many niches and distinct facets of CRE. At the Marshall Bennett Institute of Real Estate, an MSRE student learns all aspects of CRE from several legendary faculty members rather than relying solely on the guidance of a colleague.
The Need for CRE Talent is Real
Let’s go back to why we need so much new talent in CRE and why now may be the best time for you to explore a pivot within the industry. Since the end of the Great Financial Crisis in 2010, there has been an incredible amount of money raised and invested in CRE properties, and those portfolios need oversight and management. New platforms are being created and others expanded to attract additional capital and to manage and invest those funds, requiring talent to execute the strategies.
The CRE industry is also facing a “great resignation” of sorts as many industry leaders who have helped with this growth and expansion over the past 40 years are retiring, providing opportunities for upward movement in CRE organizations. To recoup the talent loss we’re experiencing, what we need is a new generation of energetic leaders ready to further develop and implement exciting initiatives like ESG, proptech and data analytics. Fresh perspectives on how to invest, manage and develop CRE assets will propel us forward as we continue to support, manage and service this burgeoning industry.
But where will these new ideas come from? I know from experience that many of those who will lead the future of the CRE industry will have enhanced their preparation by completing advanced real estate degrees where they will have access to cutting-edge information and exclusive access to top dealmakers.
Advanced Studies = Advanced CRE Opportunities
Pursuing a business graduate degree is often most beneficial for those already in and around that business discipline. For those in commercial real estate, an MSRE is really no different. It is important to see a pathway for the additional knowledge you need that can’t be gained “on the job” and how it can lead to career advancement and greater options
Another post-baccalaureate option is a graduate certificate that focuses on specific knowledge and concepts. For example, a professional may be committed solely to learning the ins and outs of community development and how to partner with private investors, local authorities and community organizations to transform historically disinvested communities through development. In this instance, a graduate certificate in Real Estate Finance and Investment could be just what they need for this targeted knowledge and could be completed in only 12 credit hours.
MBIRE created two graduate certificate programs: Real Estate Finance & Investment and Real Estate Development to respond to the demand from professionals wanting to enhance their knowledge without having to make a two-year commitment to pursuing a graduate degree. At MBIRE, graduate certificates can be completed in two semesters, taking two courses each semester.
Graduate-level studies in CRE, especially for industry participants who are not currently in the mainstream of the business, can support a better integration of the goals and concerns of clients because students gain a better understanding of the practical side of the industry that can be applied to design and feasibility conflicts or budgeting and financial returns. Additionally, for industry participants who are on the public side of community development and public finance, the CRE knowledge gained through the advanced degree will help facilitate a better understanding for negotiations with the private sector for partnerships and planning.
Can one succeed in the commercial real estate industry without a graduate degree? Sure, but the rapidly expanding and evolving industry needs professionals with a broader and deeper understanding of the fundaments, challenges, opportunities and new frontier of commercial real estate. A highly educated workforce will help CRE firms grow and lead the industry into the future.