In a recent survey of corporate real estate executives at corporations globally, 87 percent reported that their base salary increased from 2017 to 2018, by an average of 5.3 percent. In addition, 80 percent projected further increases of roughly 4 percent on average in 2019, according to a survey conducted by CoreNet Global and FPL Associates.
Total annual remuneration, including long-term incentives, for a global head of corporate real estate was $385,000 in 2018, compared to $339,000 in 2017.
“Salary increases continue to be the predominant practice for CRE and other real estate sectors. The prevalence of bonus increases, however, continues to be split between firms indicating increasing awards (~50 percent) and no change from the prior year. We have found this is largely due to firms indicating that performance-based incentives are falling at or near target,” said FPL Associates.
The function of corporate real estate is an increasingly strategic function of the corporation – directly tied to many others, including workplace strategy and design, corporate finance, site location and often overall corporate branding.
Corporate real estate professionals have strategic responsibility for their corporations’ total real estate footprint of owned and leased space; they generally manage portfolios with millions of square feet of property spanning multiple continents. Corporate real estate touches all classes of property, land and buildings such as office facilities, data centers, manufacturing facilities, logistic centers, corporate headquarters, distribution facilities, retail stores and hotels.
The average corporate real estate department that participated in the survey manages 505 locations and more than 35 million square feet. The companies represented had an average of 41,000 employees and an average of $40 billion in annual revenue.
“We know that corporate real estate for the last several years has become an increasingly strategic function within the corporate hierarchy, which is why compensation levels have been consistently increasing year to year,” said Tim Venable, senior vice president at CoreNet Global. “This year in particular, CoreNet Global completed FutureForward 2025, which is a projection of how the profession will continue to evolve and how CoreNet Global will respond. We believe that corporate real estate will become a broader function that encompasses the overall employee experience.”
In the third quarter of 2018, FPL worked with CoreNet Global to develop a questionnaire for the purpose of gathering compensation information relevant to internal CRE organization employees in the current market.
For this year’s survey, 166 end user (occupier) members provided thorough responses, classifying them as participants.
The participants represented 143 companies, many of which are Fortune 500 firms in a variety of industries including technology, financial services, and manufacturing.
Ninety-four percent of participants’ internal CRE organizations currently have operations and/or staff located in the United States, 55 percent in Europe, 50 percent in Asia, 41 percent in Canada, 35 percent in Australia/New Zealand and 31 percent in Latin America.