Real estate pay gaps: women are recognised but under-rewarded

As the deadline for reporting gender pay gap figures passes, EG has taken its annual delve into the numbers to find out what progress is being made across the real estate sector. Data filed with the government shows small steps in the right direction around pay parity, but huge leaps backwards when it comes to reward. EG’s analysis of figures from 22 of the major real estate firms that filed data on gender pay gaps  revealed a small improvement in their mean average gender pay gap. The average across the firms nudged in from 26% in 2022 to 25.7% for 2023. Across the 119 firms that filed figures and registered themselves primarily as real estate companies, the average mean gender pay gap was 15.6%, showing that our core real estate owners and advisers still have a long way to go. The average across the more than 10,000 companies that submitted data this year was 12.5%.     Bonus gap While the nudge in the right direction on pay parity is encouraging, this year’s figures show a trend across the sector, and in the both the property owning and property advisory sectors, of a widening bonus gap. Of the 22 firms analysed by EG, 13 reported a widening bonus gap year-on-year, with Grainger, Landsec and Avison Young topping the list. Grainger’s bonus gap was 45.9%, up from negative figures in 2022. Landsec had a bonus gap of 60.1% up from 21.9% last year, while Avison Young saw its bonus gap increase from 65% to 87.5%. The agent had the largest bonus gap in 2023. “We know we have a lot more to do, but initiatives that were put into place in 2023 are starting to gain real traction,” said AY UK president Nick Walkley. “We are striving to be a truly diverse, inclusive and equitable business and real influencer in the real estate industry, through our policies, training and leadership.” The top 10 largest bonus gaps were all found in advisory firms this year (see below). CBRE, MAPP and Carter Jonas were the only agents in the 22 firms studied to sit outside the top 10, at numbers 12, 13 and 16 respectively. Carter Jonas was the only consultant to have a bonus gap of less than 50%. The average bonus gap across all 22 firms was 54.7%, up from 50% in 2022. This compares with an all-real estate average of 21% and a national average of 16.2%. Among the firms analysed by EG, the propcos saw the biggest increase in bonus gaps year-on-year, up from 30% in 2022 to 39.4% in 2023. The agency bonus gap increased from 64.4% to 66.7%. Landsec noted the trend in its report. It wrote: “We believe the main reason for our large bonus gap is due to the reduction in gender diversity as the job level increases and due to there being a larger proportion of men in property roles which attract higher salaries (and therefore higher bonus outcomes) than our non-property roles.” Kelly Bream, chief operating officer at Bidwells, which has a bonus gap of 61% and 22% pay gap, said the firm’s bonus gap remained “significant and variable, with no reliable trend towards closure”. “We believe this is partly because of our gender imbalance in leadership roles, but also because most of our agency roles are occupied by men, which are more heavily remunerated through bonuses than other positions more heavily occupied by women,” added Bream. “This is an area where demographic change has been more challenging to effect.” 10 biggest bonus gaps Avison Young: 87.5% LSH: 83.9% BNP PRE: 72.5% Colliers: 71.9% Knight Frank: 70.7% Cushman & Wakefield: 68.8% Gerald Eve: 68.6% Savills: 68.1% JLL: 65.9% Bidwells: 61%     Senior roles The lack of women in senior positions remains the biggest challenge for firms across the sector trying to close both pay and bonus gaps. Across the 22 firms analysed by EG, some 56% of positions in the lower pay quartile are held by women, compared with 27.2% in the upper quartile. Among the propcos this ratio nudges slightly in a positive direction at 55.1% and 31.5% respectively, while in advisory it shifts the other way at 58% and 25%. “The real estate industry faces a long-standing challenge of achieving balanced gender representation across all levels and roles,” said Hannah Awonuga, group head of diversity, equity and inclusion at Knight Frank. “Analysing our data tells us our gender pay gap is driven by two factors: first, women are under-represented at the most senior levels of Knight Frank; second, they are under-represented in revenue-driving roles.” Committing to change Knight Frank senior partner and group chair William Beardmore-Gray added: “I want to play my part in shifting the balance of our business – the process has started, and we are making steady progress. Twenty years ago, I would not have recommended our sector as a career choice for my daughters. Today, I would do so without hesitation.” Beardmore-Gray, like a number of his peers across real estate, said he was committed to changing the make-up of the sector. “Transforming Knight Frank will take time, but it needn’t take decades,” he said. “Given the strong foundations now in place and the talented people already working here, I am looking forward to seeing measurable and sustainable progress over the next few years.” Lambert Smith Hampton chief executive Ezra Nahome said: “Our industry is changing, as is the nature of our work, with client and market needs evolving. With these changes comes increased opportunity for talented and motivated people across our business.” LSH reduced its gender pay gap by 4.8 percentage points between 2022 and 2023, but still remained among the top five firms with the biggest gap. It also had a bonus gap of almost 84%. “We have focused most recently on direct investment into our lowest pay levels, and we remain committed to initiatives that address gender imbalance across all areas and levels of our business,” said Nahome. “It is our responsibility as a company to continue to stimulate and accelerate change for ourselves and the industry as a whole. Reflected in our data this year we have made encouraging progress. “Are we where we want to be? No, not yet, but we recognise this and are committed to move the dial year-on-year and increase this pace of change.” Women in top earning positions: best to worst Grosvenor MAPP Crown Estate Grainger JLL Bidwells Landsec Carter Jonas Greystar Europe British Land Savills Knight Frank CBRE St Modwen Properties Hammerson Cushman & Wakefield BNP PRE Avison Young Gerald Eve Colliers Canary Wharf Group LSH Ethnicity pay gap A small number of firms also reported ethnicity pay gap figures alongside gender pay gap figures. Of the eight companies that shared comparable figures, only two reported an improvement in both pay and bonus gaps. Ethnicity pay gap: best to worst St Modwen JLL British Land BNP PRE Savills Grosvenor UK Gerald Eve Landsec BNP Paribas Real Estate improved its ethnicity pay gap by 4.1 percentage points to 18.9%, while its bonus gap improved by 3.4 percentage points to 75.7%. Despite improvement, the gap was still the largest among the figures shared. JLL saw its ethnicity pay gap nudge inwards by 0.8 percentage points to 13.5%, but improved its bonus gap to 39.8%, some 19.1 percentage points lower than 2022. UK chief executive Stephanie Hyde said: “While there is much to be optimistic about, the pace of change remains challenging. Our mean pay gaps for gender and ethnicity are continuing to narrow. “Change needs to come faster – diversity, equity and inclusion remains a priority for JLL and we continue to embed this into every element of how we operate as we strive for everyone to feel that sense of belonging where they can flourish, and our business can prosper.” British Land also improved its ethnicity pay gap, narrowing it by 5.5% percentage points to 18.1%, while Savills improved its ethnicity bonus gap by 8.6 percentage points to 58.2%. Average ethnicity pay and bonus gaps across those firms that provided data were 21.3% and 40.4% respectively. Pay quartile figures from all eight firms show a lack of ethnic minorities in any part of their businesses. Only BNP PRE and St Modwen had double-digit percentages in the upper quartile – 14.4% and 10.8% respectively. JLL nudged close at 9.9%.     Looking ahead, it is clear that businesses know there is still more to be done and that the responsibility lies heavily on the shoulders of leadership. BNP Paribas Real Estate chief executive Etienne Prongué said: “We acknowledge the pressing need for diversity not only within our organisation but our wider industry. By collaborating on key initiatives and embedding social value, we aim to contribute to a more equitable and inclusive society. “Our gender and ethnicity pay report shines a light on what we have achieved so far while holding us accountable to our long-term commitments.” “As a business, we are naturally inclusive by the nature of the people we employ. However, it remains our responsibility as a leadership team, and as colleagues to recognise that there will always be more that we can do,” said Gerald Eve chief operating officer Kate Morgan. “Inclusivity and equity is about recognising and acknowledging every individual’s perspective and embedding that into how we operate. The onus is on us to continue challenging our actions and asking what more can be done to keep EDI at the top of the agenda.” Further reading Many firms compile comprehensive reports on both their gender and ethnicity pay gaps, providing detailed explanations of the numbers and what they are doing to improve on their figures. See below for useful resources: Avison Young Bidwells BNP PRE British Land Colliers Crown Estate Gerald Eve Grosvenor JLL Knight Frank Lambert Smith Hampton Landsec MAPP Savills St Modwen Photo © Vlada Karpovich/Pexels