ICSC: International Council of Shopping Centers

Industry salaries, bonuses grew in 2015

Publish Date: March 15, 2016

Category: SCT Newswire Articles

ICSC’s latest compensation survey for North America highlights the optimism that prevailed in 2015 as companies hired staff, sweetened bonuses and boosted salaries. “Particularly for real estate companies, compensation tends to be directly tied to performance,” said Josh R. Anbil, a senior managing director at compensation consulting firm FPL Associates, which specializes in the real estate industry and has offices in the U.S. and abroad. The firm produced the 240-page report on behalf of ICSC. “The survey results indicate that 2015 was a strong year for the industry. This drove increases in salaries and bonuses, as well as expanded eligibility for long-term incentives.”

The participating ICSC members, surveyed last summer, provided details about salaries, bonuses, long-term compensation and other fundamentals for nearly 100 positions in retail real estate — from junior level to the C-suite. Approximately 80 percent of these responding companies are private. Roughly 77 percent of the companies said they raised salaries last year, with the average increase being 3.6 percent. Nearly 70 percent of the respondents said they plan to keep raising salaries this year. “This is in line with compensation trends in other sectors and slightly above the long-term historical average,” Anbil said.

Cash bonuses increased at 56 percent of the companies, stayed the same at 23 percent of them and were lowered at all the rest. The level of equity or long-term compensation was generally flat relative to the year before, the report says. Some 70 percent of those responding went into 2015 confident that performance would be better than in 2014, Anbil notes. “It is not as though 2014 was a bad year, or even 2012 or 2013,” he said. “The industry has climbed out of recession, and most of these firms have experienced successive years of improvement. In other words, the year-over-year results in 2015 were on top of a pretty strong baseline.”

Nearly 90 percent of the respondents were in hiring mode last year, with demand particularly strong for specialists in property management, leasing and accounting, notes Lindsay M. Pankratz, FPL Associates’ survey director. Demand was also high for construction and development experts, said executive recruiter Chris Rollbusch, president of San Diego–based CenterNet Search Group. “These professionals are still hard to find, because so many left the industry after the recession,” he said. “Assistant managers started to return for some. But several years ago you could hire an assistant manager for less than $50,000. Today it might take $80,000 or more to attract good talent.”

But all the optimism notwithstanding, there are those who lean toward caution about the near term. “We are starting to hear some cautionary notes in the marketplace,” said Jeremy I. Banoff, a senior managing director at FPL Associates. “We have had this great run-up over the past few years, but the question is whether we are at a plateau or maybe the tip of an iceberg. We have already seen some pullback.” Rollbusch says some of these jitters may reflect uncertainty over the U.S. presidential election. “Some companies are starting to prepare for recession by reducing staff and slimming down,” he said, “but others don’t have that sentiment.”

In conducting the survey, FPL Associates saw an 18 percent increase in participation over the previous year, Pankratz noted. “Any company that participates in the survey receives a free copy of the report of findings,” she said, “which is a great incentive to participate and help build upon this research.”

The full report is available for purchase from ICSC here.

See More News