REIT CFO hiring landscape undergoing a seismic shift by Anthony J. LoPinto and Eric Moskowitz
November 2011 An analysis of more than 150 Chief Financial Officers at REITs shows that the industry is placing new emphasis on capital markets experience and diversity.
After three years of depressed activity, commercial real estate is gaining momentum. Transactions in the second quarter were more than double their level from a year earlier and quadruple the post-recession low of $12.9 billion in the first quarter of 2009, according to Real Capital. As a result, and because of more complicated transactions, real estate firms are reevaluating the role of the Chief Financial Officer (CFO). Korn/Ferry International recently completed an analysis of more than 150 CFOs at publicly-traded Real Estate Investment Trusts (REITs) across the United States. The goal of the study was to identify trends in the types of CFOs being hired, as well as changes in compensation. There were three main findings stemming from the Korn/Ferry study:
1. Capital markets backgrounds are increasingly appealing to REITs hiring financial officers, rather than the more traditional accounting.
2. Real estate firms are getting more diverse: a third of publiclyannounced CFO hires in the last year were women.
3. Total compensation is rising as real estate firms prioritize financial risk following the credit crisis and are seeking more seasoned candidates.