Students awakening to the possibilities of a career in Canada’s commercial real estate sector have typically done so through the medium of American textbooks on investment and finance. Instructors in the handful of undergraduate and graduate level degree programs across the country that offer a specialization in real estate have long relied on imported sources for the basic theories and their own network of expertise to cover a sweeping range of uniquely Canadian market factors.
The newly released textbook, Canadian Commercial Real Estate: Theory, Practice, Strategy, now packages the universal principles and the domestic context into one 500+-page compendium devised to impart a grounding in real estate fundamentals, transactions and the multidisciplinary oversight of income properties. With the association for Canada’s leading commercial real estate companies and institutional investors — REALPAC — serving as the publisher, the textbook is held up as a tool for both prospective new recruits and their employers.
“People entering into the industry won’t have to go through the serendipitous experience-based training that many of us went through early in our careers,” says Michael Brooks, the principal author and REALPAC’s chief executive officer. “They have a baseline they can work from for all those things they previously had to learn by osmosis.”
That baseline follows a 12-chapter learning curve from underpinning philosophies and mathematical methodologies to hands-on deal-making, financing, development and asset management. In addition to Brooks, who has practiced commercial real estate law for 35 years, eight professionals from various industry disciplines contributed sections of the extensive content, while dozens of others reviewed and commented on the work in progress. The resulting representative picture of the Canadian commercial sector has received enthusiastic reviews from educators.
“I’ve read at least 100 textbooks in real estate and this is one of the best,” Cynthia Holmes, chair of the Real Estate Management program at Ryerson University, told a gathering at last week’s official book launch, which also featured a panel discussion on needs and priorities for real estate education and training.
Demand for formal learning support is growing with the relatively recent advent of Ryerson’s undergraduate program, which will deliver its first class of graduates in the spring of 2017, and new master’s level programs at University of Calgary and University of Toronto. Along with longer established programs and/or specializations at University of Guelph, York University and University of British Columbia, commercial real estate might be categorized as a niche academic pursuit with upside potential.
“I see students who are 19 years old saying: Real estate is my thing,” Holmes reported. “They are incredibly engaged in this topic.”
The textbook’s proponents foresee an even broader base of consumers including industry rookies with more general educational backgrounds, neophyte investors seeking to augment their knowledge of the asset class, and researchers from other fields who require clarification of real estate related matters.
While math is math in any backdrop, many defining elements of the market are embedded in Canadian law, land use planning, businesses practices and culture. It doesn’t take a strident nationalist to conclude that approximately USD $784 billion of institutional grade real estate (as Prudential Real Estate Investors estimated in 2012) merits a tailored insiders’ perspective.
“A country the size of Canada with our mature market ought to have its own textbook,” the introductory chapter states.
“This fills a need,” Brooks concurs. “REALPAC is always about leadership, and the textbook is a good fit from the leadership perspective.”
Cultivating a combination of hard and soft skills
Core knowledge of real estate’s more technical elements and procedures can give prospective new hires an initial edge over candidates with other educational backgrounds. Nevertheless, the associated panel discussion frequently turned to qualities that aren’t tied to any specific academic regimen — notably, the ability to communicate, collaborate, and identify and exploit opportunity.
Tackling the wider topic of real estate education and training for the 21st century, the moderator, John O’Bryan, honorary chairman of CBRE, characterized the panel as two suppliers and two end-users. Holmes and Andre Kuzmicki, executive director of the real estate and infrastructure program at York University’s Schulich School of Business, provided frontline insight on preparing new generations of professionals for the workforce, while John Morrison, president and chief executive officer of Choice Properties REIT, and Norm Sabapathy, executive vice president with Cadillac Fairview, offered an assessment of that product.
For senior management, a pool of graduates with focused real estate education is still something of a rarity. “In my experience, people get into the industry by default, not by design,” Morrison observed.
From employers’ perspective, Morrison and Sabapathy enumerated some of the characteristics they often see in young employees regardless of their schooling. Although there is much to praise about the savvy of a generation that has grown up on the status quo side of the digital divide, some skill sets appear to be flagging.
“There is a gap around grammar and basic literacy that troubles me,” Sabapathy said.
“Technology plays a big part in how the generation communicates,” Morrison agreed, as he made the argument that Power Point presentations do not convey information as effectively as written reports. He also commended millennials’ commitment to career advancement, but suggested their envisioned timelines aren’t always realistic.
“I think young people today work hard. They know how to put the hours in,” he added. “Their level of patience is lower. Over time, as the so-called boomer generation continues to shift out of the business, there are going to be opportunities. The question is: do they have the patience to wait for that?”
Neither a textbook nor a degree program can fill in all the gaps, particularly given the variety and complexity of material directly related to real estate investment and management that is the prime teaching responsibility. For their part, Holmes and Kuzmicki endorsed industry mentoring as another important layer of instruction.
“The question of how to balance the hard skills and soft skills is very critical because there are all these hard skills that we are obligated to deliver as part of their education, but many of the soft skills are teachable,” Holmes reflected.
“It’s not about courses; it’s about the entire culture,” Kuzmicki said. He pointed to the annual Developers’ Den, Schulich international real estate case competition, now in its seventh year, as a significant experiential learning exercise with key input from an alumni organizing committee.
Meanwhile, Holmes solicited volunteers for Ryerson’s Take a Real Estate Student to Lunch program — a more informal one-on-one conversation that, having participated, Sabapathy promotes as a learning opportunity for both parties. “It is a tremendously great program for an hour-and-a-half investment,” he affirmed.
Leadership also entails embracing change and relinquishing control when it is time to do so. In this, panellists noted that today’s students clearly offer an antidote to what O’Bryan called the commercial real estate industry’s “pale, male and stale” prototype.
“The truth is, women outperform men as graduates of all university programs right across North America. So the supply is there,” Sabapathy advised.
As a downtown university in one of the world’s most ethnically and culturally diverse cities, Holmes reiterated that her students reflect their community. She challenged employers to do likewise.
“Do you want the best, or do you want people who think like you?” she asked. “Diversity is not a value just because it adds diversity. Diversity is a value because it adds something new.”
Barbara Carss is editor-in-chief of Canadian Property Management.