SPECIAL REPORT: Diversity In CRE Is Rising, But The Industry's Troubles Threaten Progress
This is the fourth annual installment of Bisnow's DEI Data Series, an ongoing investigative project that examines the diversity of the boards and executive leadership of the biggest companies in commercial real estate. Over the years, this award-winning series has amassed a cache of data that continues to shine a spotlight on racial and gender inequality at the highest ranks of the industry. To read the entire series, please click here.
The year 2023 will be remembered by real estate for many things — a rise in layoffs, bankruptcies and foreclosures, and a decline in property values and transactions.
But despite the grim reality of the moment, the leadership ranks at the industry's largest firms have never been so diverse.
People of color make up 12.8% of the C-suites at 89 of commercial real estate's largest brokerages, developers, finance firms and real estate investment trusts, up from 11.6% in 2022 and 10.9% in 2021. Women in the C-suite have seen their representation increase to 26.2% this year from 25.6% in 2022 and 23.5% in 2021.
Elevating women and people of color to the highest positions of power requires an intentionality that often gets lost when executives are focused on dollars and cents, Cresa's Ditmars said.
Cresa's female representation stands out. Six of the firm’s eight top executives are women, and at the board level, there are five female representatives out of 13.
Sharon Morrison, Angela Roseboro and Suellen Ravanas are some of the board’s more recent additions. They were appointed to help the firm achieve its growth objectives, and the hiring and promoting of diverse talent plays an important role in those efforts, said Ditmars, who is also a board member.
“If you’re just one woman in a room, it’s tokenism,” she said. “But now we’re part of the discussion. They’re not listening to what I have to say because I’m a woman. I just happen to be one, and I happen to be the voice in the room.”
Proclamations around the importance of diversity are being tested, and Jarvis said leaders of major brokerages are having to prove their mettle.
Savills doesn’t have any people of color in its C-suite or on its board, but Jarvis said elevating vocal advocates like himself to the position of vice chairman goes a long way in proving the firm’s commitment to DEI.
“There’s only four African American vice chairmen in the industry,” he said. “These are the steps to take to groom people and to expose people to the company.”
Future brokerage leaders have to start somewhere, but the business is notoriously difficult to break into because of its commission-based pay. That is why Savills’ junior broker development program gives recent college graduates a 15-month salaried opportunity to advance their careers in CRE. These types of tools are critical in recruiting people from disadvantaged groups who might otherwise shy away from CRE’s commission-based pay structure.
“It’s really difficult business to be a successful broker. It takes a different level of risk profile, and historically it’s taken a different level of support,” Ditmars said. “I don’t think it’s by accident that it was wealthy white men who were in commercial real estate, because they could actually afford to have a bad year.”