Real Estate Industry Profile

Companies in this industry buy, rent, or lease real estate, manage residential, commercial, and industrial properties, and provide other real estate related services, including appraisals. Major companies include CBRE, Host Hotels & Resorts, Realogy, and Simon Property Group (all based in the US); as well as Finatis (France), Mitsui Fudosan (Japan), Savills (UK), and Scentre Group (Australia).

Global investment in commercial real estate was expected to reach about $800 billion in 2019, according to JLL. In 2018, the top cities for direct commercial real estate investment included London, New York, Paris, Seoul, Shanghai, and Hong Kong.

The US real estate industry includes about 351,000 companies with combined annual revenue of about $469 billion.

COMPETITIVE LANDSCAPE

Demand for real estate is driven by population growth, personal income, employment rates, interest rates, and access to capital. The profitability of individual companies depends on property values and demand, which are both impacted by general economic conditions. Real estate companies also rely on the supply of investment capital. Large companies have competitive advantages based on their financial resources and broad geographic reach. Small companies can compete effectively by focusing on local or regional markets. The US industry is highly fragmented: the top 50 companies account for about 20% of revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

Major products and services are property and investment management, brokerage services, leasing, valuations, relocation services, and research. Clients include property owners, investors, home buyers, and renters. Real ...