October 26, 2016
In this article, Kent Elliott, principal at RETS Associates, a leading national real estate recruiting firm, shares the top three myths about the current CRE market. Tina Prater, director of real estate at Fountainhead Development, shares how her experience from a recent search aimed at bolstering her team to meet an increased development pipeline debunks these myths.
Fountainhead is a Newport Beach, California-based retail developer with more than 25 years of experience in building neighborhood shopping centers and specialty single tenant buildouts.
Kent Elliott’s #1 Myth About the CRE Market: Development is Slowing Down.
According to Elliott, the opposite actually looks to be true. In fact, many companies still have capital that they need to place and are allocating money to the development side because acquisition prices are so high. There is evidence of this trend in RETS’ recent searches for development positions. In 2014, RETS placed 10 senior-level development positions. In 2015, the firm helped to fill nine of the same position, and by the end of the third quarter 2016, RETS has already conducted 11 senior-level development searches. Clearly, hiring continues to be very strong, which is an excellent indicator of the health of the CRE industry and its continued growth.
Tine Prater (TP): For us, development is not slowing down. We have an active development pipeline right now, with nearly 20 deals that we are working on. In the past, our “bread and butter” has been primarily single-tenant, net-lease development; however, we have grown more active in the development of anchored, neighborhood shopping centers over the last 18 months. This increase in activity has not only resulted in growth in our pipeline, but also in growth in our team. To keep up with demand, we conducted a recent search for a leasing-focused team member who could wear multiple hats depending on a deal’s progression and stage. Because we’re a mid-size entrepreneurial company, it was important for us to find someone who understood the development process..
This position is just one of the three or four more that we are looking to fill in the next six months. Things are ramping up for our development pipeline right now and we need to staff for it.