Property brokers fear bank-style jobs cull
With much of the European real estate market on its knees, the painful death of job security is now haunting property brokers as well as investment bankers.
ASDA to create 9,000 jobsHigh-flying real estate dealers are leaving their favourite tables at expensive London restaurants vacant, awaiting a purge that will have much in common with the one that has rocked Britain's banking sector this year.
Property booms fed and were fed by the global credit boom that ended abruptly last year when U.S. mortgage defaults began to mount, and investment demand in the UK and U.S. property markets has crumbled in the credit crunch that followed. Now other European markets are wilting fast and job losses may not be confined to those frontline bear markets.
"Property is a cyclical business and contraction will be inevitable as firms look to be more streamlined," warned British Property Federation Chief Executive Liz Peace.
Rumours abound that some of the biggest employers in real estate are bracing for a phase of redundancies which could cost up to 5,000 property professionals their jobs across their European, Middle Eastern and African EMEA.L operations.
Not everyone agrees headcounts are under such strain.
"Markets like Eastern Europe, Russia, Ukraine, Turkey are still growing so it would be ludicrous to downsize European businesses anywhere near that figure," said Paul Bacon at property consultant Cushman & Wakefield, referring to the rumours of 5,000 job losses.
"We have absolutely no plans for wholesale redundancies in the UK," said Bacon, who is head of Europe, Middle East and Africa business.
Major emerging markets have so far escaped the worst of the credit crunch. However, the credit boom that preceded it fed foreign investors' appetite for property as well as other assets in emerging markets.
"There are a number of markets where (property) prices have risen very quickly," said Robert Maciejko, managing director for Central and Eastern Europe at global management consultancy Oliver Wyman. "The issue is when the Brits or the other foreign investors are no longer investing, or even looking to sell, and that's when prices can really go down."
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