COMMENT: The Masters of PERE

In this month’s issue of PERE, which should be hitting your desk this week, we present the results of our inaugural graduate real estate program survey. The survey is accompanied by an overview on real estate education in the US today and is complemented by a similar look at the state of affairs in Europe.

The survey was prompted by the desire to illustrate a better alternative to the private equity industry's alleged standby method for new talent acquisition – crudely put, poaching junior analysts from investment banks. Not only is it becoming harder to continue that bad habit as finance houses crack down on the practice, but potential recruits are becoming disillusioned with the process and frantic pace. It also serves to inform firms about the growing number of universities training talent in the areas of real estate finance and investment that matter most to them.

Thanks to the participation of 24 dedicated graduate-level real estate programs and the research efforts of our edit team, PERE is able to offer you details on a wide array of offerings across the US. Key metrics include the number of real estate classes offered, the number of dedicated real estate faculty, the total cost to complete the program and the number of graduates hired by real estate firms and their average starting salaries, among others.

Although the results doesn’t cover the full range of graduate-level real estate offerings currently available in the US, we do believe we have assembled a fairly representative list of such programs, including most of the best-known ones. Among the universities represented are Columbia University, Cornell University, the Massachusetts Institute of Technology, Northwestern University, the University of North Carolina, the University of Pennsylvania, the University of Southern California, the University of Texas and the University of Wisconsin.

Getting a true count of the number of graduate degree programs currently offered with a focus on real estate was a bit tricky. University officials generally agreed that there are about 40 to 45 specialized Masters of Science in Real Estate (MSRE) programs currently available, many offered through a university’s architecture school. Interestingly, that total has nearly doubled from 20 to 25 programs as recently as the early 2000s.

There was less consensus, however, on the number of Masters of Business Administration (MBA) programs that offer a dedicated real estate concentration or ‘major’. Indeed, the current estimate for real estate MBA programs varies from at least a number equal to the number of MSRE programs to as much as twice as many. The best estimate puts the number of real estate MBA programs somewhere between that, or roughly 60.

More importantly, the number of graduate-level real estate offerings has been on the rise. According to university officials, this can be attributed to an increase in professionalization throughout the industry, the need for investment management skills across a wider breadth of opportunities and the current run-up in the cycle. And more programs are on the way, whether it is a university launching its first graduate real estate program, like George Washington University in 2015, or complementing one degree program with the addition of the other, like the University of Colorado adding an MSRE program to its existing real estate MBA next year.

That said, more programs are not a good thing if the target industry does not know they exist. Hence, the feature and accompanying tables in this month’s issue. It is our sincere hope that this survey will have a positive impact on the market and grow to become even bigger and better next year.

For the results of the survey, click here.