When Stan Ross began his real estate career in 1961, the industry wasn't nearly as sophisticated as it is today. Career opportunities were limited to development, construction, property management and basic finance. The concept of tenant representation had not yet been introduced. The U.S. Congress had just approved the creation of real estate investment trusts, opening the door for smaller investors.
Today, with the industry broadening, deepening and globalizing at a rapid pace, the possibilities are endless, says Ross, chairman of the University of Southern California's Lusk Center for Real Estate and governor of the Urban Land Institute.
"Few people are aware of the breadth of career options within real estate," says Ross, author of The Inside Track to Careers in Real Estate. "Most people think about housing or development. As an industry, it's surprisingly misunderstood and often overlooked."
But that's quickly changing. For the last three years or so, interest in real estate has skyrocketed, driven by a booming housing market. With the residential side of the industry now flattening, interest has suddenly shifted to the commercial side of the business. "Students have been very quick to adapt," Ross says.
Now in its 20th year, USC's Masters in Real Estate Development program is a prime example of the diversity in modern real estate education. USC trains students in fundamentals, such as design, zoning and construction. On the vertical side, students are exposed to various product types. There's also a heavy emphasis on finance - cash flows, modeling, instruments and securities - and on international real estate. Enrollment varies from about 45 to 75.
There's good reason the classrooms are filling up. Lusk Center MBA graduates in the Class of 2006 commanded average annual salaries of $76,700 plus a $17,000 bonus for careers in asset management. For brokerage, construction or law, salaries averaged $100,000. Finance posts paid an average of $79,000 with a $28,300 annual bonus; and development paid $95,200 with a $29,000 annual bonus.
Nearly half (47%) of Lusk Center grads opted for careers in the single-family or multifamily sectors, followed by mixed-use (20%), office/industrial (18%), retail (11%) and land (4%).
Future demand, Ross says, will come from these traditional sources. It will also stem from rebuilding efforts following disasters and from the burgeoning area of "green" or sustainable development. Finance will continue to be hot, as will international real estate.
Despite the uptick in interest, there's a shortage of young, qualified real estate talent to meet the demand. Many were scared off by real estate's downturn in the early 1990s. Later that decade, it was all about technology and Internet commerce. This dearth of qualified candidates is particularly true for non-sexy segments of the industry like real estate valuation, says Donnie Sherwood, managing director at Integra Realty Resources.
"Most get into real estate thinking about development because it's glamorous and a little more razzle-dazzle," he says. "Secondly, they look at the brokerage side because of the unlimited revenue potential."