After over six months and one hundred informational interviews, I began my career in March 2008 at one of the most well respected commercial mortgage banking firms in Boston. I never expected that I would experience such a significant downturn in this stage of my career, but like many others, I've quickly had to learn to adapt.
Twenty six million Americans are either laid off, underemployed, or discouraged enough to have stopped looking for employment. Everyone in the United States, much less those involved in commercial real estate, has felt the effects of this bear market. Mortgage lending and mortgage banking is off 90% from its peak. There has been a dramatic tightening of liquidity and a lack of capital to fill the significant void that was once the CMBS market, which is now non-existent. There are investors with billions of dollars of capital sitting on the sideline waiting to invest in commercial real estate, but there continues to be a major disconnect between buyers and sellers regarding the value of their property, causing sellers to take the property off the market. Lenders are valuing deals more conservatively than they have in recent history and many of the major players are virtually out of the market.
The impacts of all of these can be a cause for great discouragement, disappointment, and maybe even a career change; however, all is not lost. As many seasoned real estate professionals remark, the market is cyclical and will flourish again. When? Who really knows, but until then, there are still valuable lessons to be learned and experience to be gained that can provide a strong foundation for a career in this business. If anything, I consider living and working through the worst recession since the Great Depression part of a training program for future career endeavors.
Although positive monetary incentives may be on hold and transaction volume down significantly, it does not provide an excuse for a lackadaisical effort in the workplace. It is imperative that one continue to work hard and expand their skill set at every possible chance they get. A negative attitude will only damage team morale and sentiment. Become a resource for all those in and outside of your company and make yourself invaluable by specializing in a specific field. Down cycles should be viewed as a time of opportunity to re-invent or fine tune processes and services offered to build a stronger company when the recession is over.
I feel quite fortunate that I have the opportunity to work with and for individuals who have seen at least two or more market downturns. Not only have they lived through these down cycles, they have prospered in this business and continued to stay optimistic about the future of commercial real estate. Aligning yourself with a mentor that you admire and work well with will pay dividends in the future. I am amazed at how much I have learned from simple observation of my mentors in daily tasks or stressful situations.
With less deal flow today, this recession provides for yet another opportunity where you can expand your professional horizon and enhance your learning curve. Some activities that I've found helpful are taking classes or becoming more involved in industry associations by serving on a committee. One of the benefits of this is the relationships formed in these arenas. Taking courses not only reinforce what I am learning on a day-to-day basis, but provide a setting to get to know some of the senior industry professionals who offer their advice and related anecdotes. Networking with classmates or fellow committee members is easy, happens naturally and in my personal experience, is effective and rewarding.
Even though the current financial crisis has severely impacted this industry, it presents opportunities to thrive and grow as individual professionals. It is the nature of commercial real estate professionals to be motivated and tremendously resilient people. Although I, along with many others, will be looking forward to the next bull market, the experience of navigating through these turbulent economic times will be invaluable for decision making moving forward.
Cathryn Minshall is a financial analyst with Q10|New England Realty Resources in Boston.