How to develop the commercial awareness property recruiters expect
Commercial awareness is an essential skill for a career in property – one assessed in the graduate recruitment processes of all property employers. But, while graduates are generally confident about their commercial understanding, it seems that they rarely show off that quality at interview: ‘In my experience, many graduates have a good general understanding of commercial awareness, but comparatively few demonstrate it at a deep enough level,’ Karen Poulton, graduate recruitment and diversity manager at Cushman & Wakefield, says. An experienced graduate interviewer at Jones Lang LaSalle agrees with this, saying that commercial awareness is a ‘more scarce’ quality than leadership potential. Perhaps there is a misunderstanding of what graduate recruiters mean by commercial awareness.
What does commercial awareness mean in the property industry?
Commercial awareness in a property industry is essentially:
- an awareness that everything that affects the economy affects a client’s property portfolio
- a general knowledge of trends specific to the property sector, such as what’s happening with RICS (the Royal Institution of Chartered Surveyors).
Remember that recruiters are not looking for the ‘finished article’ – as Nick French, a professor in real estate at Oxford Brookes University, says, you won’t really achieve that until you’ve successfully completed the assessment of professional competence (APC) with RICS. Rather, recruiters want to see that you have potential – the ability to think laterally and spot repercussions and opportunities for clients.
What commercial awareness interview questions can property graduates face?
Interview questions that test your lateral thinking
It is unlikely that you will be asked in detail about the press releases issued by firms’ about the performance of various property markets. You’re more likely to be asked to reason or speculate about how an event reported in the news would affect a property portfolio. ‘I always start by asking a graduate about a news item that has interested them and proceed from there,’ says Karen. It’s best if you can suggest a news item yourself, but if not the interviewer will suggest one. At the time of the volcanic ash clouds, for example, Karen asked candidates how they thought airlines’ property portfolios would be affected in the short and long term.
You can prepare for this type of question before your interview. Get into the habit of reading the financial pages of newspapers, the Financial Times and the property trade press to follow events, and start thinking about how newsworthy events would affect real estate. For example, how could the growing trend for shopping online instead of in store affect a retailer’s need for property? Could this mean less of a need for high street shops and an increased need for depots? Karen’s top tip to practise this type of thinking is to follow a specific company that features regularly in the news and speculate about the impact of any events.
This sort of question might be phrased differently, such as: ‘What do you think is the biggest concern (or opportunity) for commercial property clients at the moment?’ If you’ve done the preparation outlined above, you’ll be able to call upon your reading to extrapolate an answer.
Become a commercially aware graduate
1) Get work experience
2) Seek out the opportunities on your course
3) Read the business pages and do what Karen from Cushman & Wakefield says: follow one business and consider how events affecting it will have an impact on its property needs.
Bear in mind that recruiters aren’t interested in whether you get the ‘right’ answer – in fact, most of the time there won’t be one. They are just interested in how your mind works. As our interviewer from Jones Lang LaSalle puts it, ‘a candidate who can generate a reasoned argument from even a small knowledge base’ can easily show ‘a genuine interest in property and business’.
Interview questions that test your general knowledge of the industry
You may also be asked about matters relating to the industry. Basic questions, such as ‘who is the president of RICS?’, often flummox candidates – something that does not impress our interviewer from Jones Lang LaSalle. ‘Flustered replies such as “I don’t know, but I do want to be president of the RICS one day” are not awe inspiring,’ he says.
He continues: ‘All candidates should make themselves aware of topical subjects in the industry. REITs (Real Estate Investment Trusts) were a big issue for the property industry a few years ago and I was amazed at how many candidates didn’t know what they were and what the implications were. In one instance the candidate thought it stood for “Register of External International Trusts”. Not a good guess! Answers like this show a complete lack of commercial awareness.’
How can your property course help to build your commercial awareness?
There should be many chances on your RICS accredited undergraduate or postgraduate course to develop your commercial awareness. The courses are primarily geared to giving you the practical and academic knowledge to be a competent graduate surveyor; you will need to make use of the extra opportunities to turn yourself into a competent interview candidate – there is a difference. Nick French from Oxford Brookes University, says: ‘Some students embrace the opportunities and develop reasonable commercial awareness; others fail to do so. The former, unsurprisingly, tend to be the students who are successful in finding work.’
The ways in which courses can encourage commercial awareness include:
Reflecting current issues in the degree programme
Academics appear to work hard to keep their curriculum up to date. For example, Luke Bennett, the BSc real estate course leader at Sheffield Hallam University, says that his course ‘has been enhanced to increase the focus on skills relevant to a “downturn”. All students now study a core diet that covers property development, property finance and corporate real estate. Our second year students can also take a module that looks at professional practice law specifically from the point of view of current market conditions by focusing on increased valuation negligence claims, property scams, management of risks to vacant premises and repossession processes.’
Many courses – including those at Oxford Brookes and the University of Sheffield – also require students to consider the wider effects of the economy in vocational case studies. As Cath Jackson, programme director of the University of Sheffield’s MA in commercial property and MA in planning and development, puts it: ‘From their first few weeks, students are explicitly encouraged to relate economic issues to portfolio management scenarios, both in class discussions and in formal property portfolio assignments, and this continues right through to later assignments and valuation reports.’
Running field trips and site visits
Many courses also run field trips and preliminary site visits, which help to develop students’ commercial awareness as well as their practical skills. Cath says: ‘Before modules begin, we take students on a tour of local markets, led by local practitioners, where they hear not only about deals that have been done, but why values change both in response to the economy and to occupier requirements.’
Encouraging work experience and year-in-industry placements
‘We find that our final year students – when they return from placement – have come to realise the importance of getting the best out of their remaining year of study’ says Luke. The onus is on students to secure their own placements, but universities do provide support from departmental placement tutors and careers advisers to help you.
Inviting guest speakers, employer presentations and mentors
Most universities invite guest speakers from the property profession to talk about current issues and give tips. Go along to the events with questions that prove you’ve done your research. Most careers services match up students with alumni in professional fields, so if your course doesn’t offer this go to your careers service.
