As a reporter and an editor here at GlobeSt.com, I get dozens (if not hundreds) of press releases a day about deals, financial transactions and the state of the commercial real estate market. But on a personal level, there was one particular study that caught my eye as a woman working in the CRE business.
A new report from consulting firm Ferguson Partners Ltd. shows that real estate investment trusts that have had a female board member for more than three years have seen materially higher returns than their counterparts. The study revealed that firms with at least one female on their board garnered higher shareholder return growth rates, specifically, 2.6% higher than peers over a three-year horizon; 3.6% higher than peers over a five-year period; and 3.4% higher than peers over a 10-year horizon.
William J. Ferguson, chairman and CEO of Ferguson Partners Ltd., told me that it makes a lot of sense to have women on the board, simply because “women are obviously part of any key consumer decision that is made, and when you are managing a very diverse workforce, having people on the board who understand some of those diversity issues are incredibly important.”
The study, which analyzed 164 publicly-traded REITs spanning multiple property types, evaluated characteristics such as board size, meeting frequency, compensation levels, average director age and average board member and CEO tenure during three, five and ten year periods. Ferguson said diversity was the only factor that correlated closely to performance. “You may have to look for them a little bit more diligently, but there are many, many qualified females in the REIT world.”
These data prove that commercial real estate isn’t just a boy’s club any longer, and gender diversity can actually help improve shareholder returns. That’s not only a good thing for women and minorities in the business, but it actually helps your balance sheet, too.
So cheers to the Debra Cafaros of the world, who each day are making great strides for women in the industry, showing investors that ladies are leading some of the biggest and best companies on the market. And even if you’re not a REIT, to all the women out there – whether you’re a broker, a lawyer, a developer or in construction – each day you are paving the way and breaking the concrete ceiling for all of us. And don’t forget to watch out for our annual “Women of Influence” list in the July/August issue of Real Estate Forum.
Author’s note: Hlavenka is a regular attendee of NYCREW and the New York Chapter of Professional Women in Construction.
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