Why all the new real estate heads?

January is typically the time of year when there is a blast of announcements on senior hires and promotions in private real estate. It is unusual when multiple new global heads of real estate are announced in quick succession.

Blackstone, UBS Asset Management and Partners Group each made top leadership changes in real estate within the space of a week. Last Thursday, the New York-based mega-manager promoted global co-head of real estate Ken Caplan to the newly created role of co-chief investment officer. With Caplan’s promotion, head of real estate Americas Nadeem Meghji was elevated to the global co-head role alongside current global co-head Kathleen McCarthy.

This news was followed a day later by UBS Asset Management unveiling a new global head of ex-DACH real estate, Jon Hollick. The firm’s head of real estate, EMEA ex-DACH was also promoted into a newly created role and will be reporting to Joe Azelby, who remains head of the overall real estate and private markets division.

Then on Tuesday, private markets investment firm Partners Group announced it had hired Karim Habra as its new global co-head of real estate, starting in mid-March. Formerly the head of Europe & co-head of Asia-Pacific real estate at Ivanhoé Cambridge, Habra will co-lead Partners’ real estate business with current global head of real estate Mike Bryant.

The three firms have different circumstances driving these leadership changes. For Blackstone, it is both the growth of the real estate business – which is the firm’s largest at $332 billion of assets – and the overall company, which reached $1 trillion in assets last year. This dramatic expansion required another layer of leadership, and one including a top real estate executive. KKR took a similar approach in December, when it appointed two co-presidents for its real estate platform, which has scaled to $65 billion of assets and 1,000 employees across 11 countries.

UBS’s real estate business also has grown significantly, but for a different reason: its acquisition of former rival Credit Suisse Asset Management last year. In some ways, however, Hollick’s appointment can be seen as replacing rather than adding leadership, since the merger resulted in the departure of Robert Rackind, global head of real estate at Credit Suisse Asset Management, last June.

Meanwhile, Habra’s hire reflects Partners Group’s continued growth in direct real estate investing, having first made a name for itself in the indirect space. This involves a shift towards investing in more operationally intensive real estate assets – an area where Habra is understood to have significant expertise. As Wendy Norton, managing director at New York-based executive search firm Norgay Partners, told us this week, such a high-level appointment enables firms to communicate to the market where they are placing value.

As with many senior promotions, retention factors also come into play. The thinking behind new roles and expanded responsibilities is to motivate senior management to stick around, as one market observer told us. Indeed, in the case of the promotions at Blackstone, KKR and UBS, all of the executives had been at their firms for more than 10 years, and in some cases, closer to 20. This added layer of leadership provides firms with a more robust bench and built-in succession plan.

Such top-level changes are more typical at large managers, given the size of their teams and portfolios. But while this last week’s senior human capital events shared a common growth theme, they also were outcomes of their firm’s own, particular circumstances too.