Tata Consultancy Services, the main arm of Indian industrial giant Tata, is reportedly clamping down on office-shy workers by cutting their bonuses and hovering the threat of being passed up for promotions.
The $168 billion Indian consultancy is using a carrot-and-stick approach to lure its consultants back into the office full-time after scrapping hybrid working for most employees last October.
The consultancy plans to narrow its bonus payouts to exclude those shunning office work five days a week, and will also begin factoring in attendance to annual performance reviews, which are vital for promotion opportunities, Indian publications Mint and The Times of India reported.
“The last quarter has seen most of you return to the workplace, creating shared experiences, nurturing greater learning, collaboration, and camaraderie,” TCS’s CEO K Krithivasan reportedly wrote to employees in March.
Employees working less than three days in the office will not be paid any bonus, the publications reported.
From there, bonuses will be tiered, with staff working between 60% and 75% of their time in the office receiving half of their potential bonus, and those working between 75% and 85% of their time in the office receiving three-quarters of their “variable pay.”
Only staffers working more than 85% of their time in the office can expect to receive full pay.
In effect, that means only those coming into the office five days a week are entitled to receive 100% of their prescribed bonus.
A representative for TCS didn’t respond to Fortune’s request for comment.
TCS clamps down on remote workers
TCS is a major arm of the Tata group, hiring more than 600,000 people from 152 nationalities. The company hires 20,000 people in the U.K. across 30 locations, according to a 2022 press release. The company is the main sponsor of the London Marathon.
It has been hailed as a progressive employer and has the accolades to prove it.
TCS was one of 16 companies recognized as a “Global Top Employer” for 2024 by the Top Employers Institute, a certification handed out based on employee surveys. The consultancy also made Fortune’s Most Admired Companies list for 2024.
But TCS now risks flaring tensions among staffers as it goes beyond rules and rhetoric to actively punish workers who don’t make it into the office.
In October last year, TCS scrapped its hybrid work policy, ordering most employees back to the office five days a week.
The group’s CEO Krithivasan pointed out that in February nearly 40% of his workers joined the company during the COVID, and the company had no hope of assimilating them if they stayed at home.
TCS’s chief operating officer NG Subramaniam said: “Around 40,000 employees joined us online and quit online without any offline interaction during the pandemic and that kind of situation cannot be helpful for any organization.
“We are very clear that we have to get our original culture back.”
The recent memo distributed to workers shows just how serious TCS’s C-suite is taking its own rhetoric.
In addition to capping bonuses based on appearance, office attendance will also reportedly be factored into performance-related reviews.
“Employees’ compliance to work from home will be reviewed every quarter. In the event an employee is found to be in violation of the laid down policies, there will be implications on the annual performance review, compensation, and career progression of the employee,” the policy reportedly reads.
Tying company bonuses to attendance is a novel approach to getting staffers back to the office, but follows a familiar tactic from tech companies that involves using financial incentives to convince workers to come in.
In 2021, several tech giants including Meta and Google said they would cut the pay of staff who had moved to remote areas with a cheaper cost of living than in their hubs in Silicon Valley.
These companies have now introduced stricter hybrid policies that ask workers to come in at least four days a week.
If you’re interested in a career in real estate with a high-earning opportunity, you may want to focus on commercial properties. The exact numbers vary by source, but according to National Association of Realtors data, the median residential real estate agent made $34,100 in gross income in 2020. Commercial real estate agents? They brought in over $150,000.
Real estate education provider McKissock estimates commercial real estate agent earnings are even higher – about $166,000 annually.
“Price points of commercial real estate tend to be higher than residential,” says Courtney Potter, founder of Potter Real Estate Partners in Orlando, Florida. “The commission rates reflect that.”
Of course, those commissions aren’t a given. Selling commercial real estate requires specialty training and education, as well as a solid dose of determination and hard work. Looking to break into the commercial real estate world? Here’s what agents say you should know to get started.
What a Commercial Real Estate Agent Does
Commercial real estate agents – also called CRE agents – focus on selling and leasing properties for businesses and other commercial purposes. They might assist a client in finding offices, developable land or retail space, and they help evaluate those properties from an investment standpoint.
“Commercial real estate is managing the client’s financial returns on an investment,” says Galit Ventura-Rozen, a commercial real estate broker with Commercial Professionals in Las Vegas. “Residential agents need to understand their clients’ personal preferences, versus in commercial, the agents focus on the asset types and how quickly a client can anticipate a return on those investments.”
According to Ventura-Rozen, commercial deals tend to be “more intricate and complex” than residential ones and can take much longer to close. Sometimes – particularly with leases – those transactions can span years or even decades.
As Potter explains, “Commercial closings can oftentimes take eight months to close due to all the due diligence requirements needed to go through prior to closing. This includes such things as meeting with the local municipality to confirm you will be able to get permits, environmental studies, getting signoff from all the agencies to get permits in place and so much more.”
Because of these long close times, most CRE agents handle only a few transactions per year. According to NAR’s data, the typical CRE agent does four sales and six leasing transactions per year. The median total sales volume transacted by a CRE agent is $4.2 million.
How to Become a CRE Agent
The exact path to becoming a commercial real estate agent depends on where you live. In some states, such as Minnesota, you can get a specific commercial broker’s license, which allows you to sell commercial properties in the state. In others, the license is the same for both residential and commercial agents.
In addition to getting the proper licensing, you should also look into commercial-related continuing education courses or explore getting a commercial designation, like the Certified Commercial Investment Member (CCIM) or the Society of Industrial and Office Realtors (SIOR). These can help you network as well as better understand how commercial transactions work.
“I tell any agent they need to invest at least two years in the early part of their career to focus on training and skill development,” says Alicia Shepherd, a commercial real estate agent and trainer with Keller Williams Commercial in Santa Monica, California.
As for skills, experienced CRE agents say being self-motivated, a good problem-solver and a smart negotiator are critical to success. Honing your analytical, communication and financial abilities is key, too.
“While a residential agent may be highly interested in a career where they get to shop for houses, stage beautiful homes and close transactions in a relatively short time, a commercial agent needs to be built for something totally different,” Shepherd says. “We need to be highly analytical and comfortable delving through large contracts and leases. We need to be ready to work a deal for months – even years.”
Experienced CRE agents also say finding a mentor is critical. According to NAR’s survey, 59% of commercial real estate agents sought a mentor in their first year of working.
“Usually when someone is new to commercial, they need to find a mentor in that niche that will teach them the ropes – and that’s not always easy to do,” Potter says. “Many seasoned agents and brokers do not want to take the time to train nor compensate another agent to learn what they know.”
One option is to choose a brokerage that offers mentorship as part of your onboarding and training.
“I recommend finding a commercial real estate company that will take you on as an employee so you can learn hands-on through observation and day-to-day tasks,” Ventura-Rozen says. “This gives you the opportunity to get paid a salary or hourly while learning the ins and out of transactions.”
Is It a Good Time to Get Into Commercial Real Estate?
Commercial real estate offers the potential for a lucrative career, but your earnings will depend on what you put into it – as well as overall market conditions. According to many in the industry, CRE has a bumpy road ahead.
With remote work still a popular option, demand for office space has plummeted in recent history. Nationwide, office space has an 18.2% vacancy rate and leasing rates per square foot have dropped compared to last year. High interest rates and other economic factors make the industry challenging as well.
“With interest rates and construction costs high, many commercial property owners and buyers are waiting for market conditions to change,” Potter says. “That means commercial agents aren’t making as much money as they have the past couple of years.”
Still, that doesn’t mean there’s not opportunity in CRE. New agents just need to be willing to hit the ground running to drum up clients and sales.
“(2024) is going to be a year for the thick-skinned,” Shepherd says. “The outlook includes a wave of commercial debt coming due, uncertain global economics and both buyers and sellers having fatigue from market conditions. Agents in the space will need to be masterful at sourcing out opportunities, making a market around them and overcommunicating. Buckle up.”
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For many employees, the debate around returning to the office increasingly felt like a “when,” not “if” in 2023, as major CEOs sounded the drum on getting their staffers back under their noses.
This year, it looks like those employers are planning to put their money where their mouth is by beefing up their desk space and embracing a hybrid model of work that may end many workers’ dreams of a fully remote future.
According to a new report by French consulting group Capgemini, a quarter of businesses are planning to increase spending on real estate in 2024 to accommodate the return of their workers.
It marks a steep rise from the start of 2023 when just 4% of businesses told the group they were planning to up real estate investment through the year.
Rather than indicating a full return to the office five days a week, though, Capgemini’s research suggests it is part of a wider plan among several organizations to shift to a longer-term hybrid working model.
A new ‘equilibrium’
Capgemini, valued at nearly $37 billion, works as a technology and sustainability consultant with some of the world’s biggest companies.
The group’s CEO, Aiman Ezzat, told Fortune that those clients were now starting to find an “equilibrium” through hybrid work between flexibility for workers and the face-to-face interactions demanded by managers.
Ezzat personally embraces a hybrid model by getting his 342,000 Capgemini staff into the office three days a week, an initiative he started in Europe as COVID-19 restrictions wound down.
He says six months ago the company’s Chicago office was empty on a Wednesday, but now he would struggle to find a seat on the same day of the week.
“People are coming back, the interactions are happening, the intimacy is being rebuilt,” Ezzat said of his own workforce.
“That hybrid model is starting to operate in a more satisfactory way. And people find pleasure in coming to the office to interact with others, so new rituals are being built in a certain way.”
In December, French multinational Schneider Electric crystallized this vision in comments in a Capgemini report.
“Hybrid work will be about mass customization, allowing every employee to customize working environments to their personal circumstances, career, or life stage,” the group’s chairman Jean-Pascal Tricoire said.
RTO mandates ramping up in 2024
News of fresh investment in the flagging real estate sector will come as a welcome relief to developers and office managers, who have been left sweating as swathes of expensive Grade A office space go unused.
Last week, the Wall Street Journal reported that a fifth of office space in the U.S. was now empty, the highest share since 1979.
Ermengarde Jabir, senior economist with Moody’s Analytics, told Fortune earlier this month that the outlook for commercial real estate was muted in 2024 as businesses undergo a “recalibration.”
Evidence from last year suggested that recalibration would involve companies downsizing their office space.
Luxury retailer Neiman Marcus dumped half a million feet of office space and embraced a work-from-anywhere policy among its workforce. This was in part driven by the company’s previous bankruptcy and an urgent need to cut costs.
Other businesses are taking a more strategic approach to reducing or altering their corporate real estate footprint.
Last year, Google asked returning employees to share desks with a “partner” as they came in on alternating days. Mark Zuckerberg’s Meta paid $181 million to end a lease on its London property in September as part of layoffs and a push towards hybrid work.
The findings from Capgemini are the latest reminder for workers that the debates over where they work will only intensify this year.
The prospect of spending money on their commute has left employees demanding concessions including pay rises and free lunches if they have to come back to the office.
Hybrid models have increasingly been pushed by companies as a compromise to avoid these costly concessions. It’s also seen as a way of utilizing those expensive long-term leases on office space deals signed before the pandemic.
But not all CEOs are confident, or even hopeful, that the hybrid model will triumph as the default future of work.
More than 60% of bosses surveyed by KPMG last year said they expected a full return to in-office working by 2026.
However, many of those CEOs thought incentives like salary bumps and even more favorable assignments would be offered to entice workers back full-time.
CEOs more optimistic about 2024 business landscape
Capgemini’s report on investment priorities for 2024 finds the CEOs it surveyed in brighter spirits than at the start of 2023.
Businesses at the time were still dealing with high levels of inflation with the expectation of further interest rate rises on the horizon. An underperforming stock market in 2022 put extra dampeners on spirits to start last year.
This year though, 56% of surveyed bosses said they were optimistic about the outlook for the global economy in 2024, compared with 42% last year. Confidence was higher in Sweden, the U.K., and the U.S., and lower in struggling European economies like Germany and Italy.
Alongside investment in real estate, businesses are also expecting to continue splurging on AI this year, while also putting resources into customer experience and talent.
In 2023, Capgemini itself pledged €2 billion ($2.2 billion) towards enhancing its AI capabilities over the next few years. This would involve the company doubling its headcount in its data and AI teams by 2026.
90% of homebuyers have historically opted to work with a real estate agent or broker. Here’s why that's unlikely to change, according to the National Association of Realtors
Last month, the National Association of Realtors announced a settlement that would resolve nationwide litigation over claims from home sellers related to broker commissions.
The $418 million settlement, and the practice changes it will usher in, have led some to speculate that real estate agents are at risk of becoming obsolete. As someone who has practiced real estate for 15 years, nothing could be further from the truth.
Members of the National Association of Realtors will continue to be the most reliable partner for the millions of Americans striving to realize the American dream through homeownership.
Specifically, the settlement will prohibit offers of compensation from being shared on multiple listing services (MLSs), the databases that show real estate brokers the properties for sale, and it will require MLS participants to enter into written agreements with their buyers.
These changes will go into effect in mid-late July 2024.
It’s important to note that the National Association of Realtors does not set commissions, and nothing in this proposed settlement would change that. Commissions would continue to be negotiable among buyers, sellers, and their brokers.
The “cooperative compensation” rule that has been subject to litigation says that selling brokers have to specify on each listing an offer of compensation to buyers’ brokers. That offer could be any amount, even zero.
Consumers continue to have options when it comes to compensating the brokers they work with. Some consumers may opt to pay a fixed fee for their broker’s services. In other cases, a seller may offer a concession on the sales price, which could be used by the buyer to help compensate their broker. And in other cases, listing agents may offer a portion of their compensation to buyers’ agents as long as the offer of compensation does not occur on an MLS.
Cooperative compensation, where the compensation a seller pays to their broker is shared, covering the cost of a buyer broker’s services, will continue to be an important option for consumers in all transactions and especially those involving lower and middle-income homebuyers, who may already have a difficult-enough time saving for a down payment.
The bottom line is that consumers will continue to be able to choose what kind of professional real estate advice they’d like–and how much, and how, they will pay for the work of a real estate professional.
Historically, nearly 90% of homebuyers have opted to work with a real estate agent or broker. That figure is unlikely to change.
Even in an era where seemingly everything can be researched and purchased electronically, the clear value added by realtors remains evident. Nine in 10 home buyers would use their agent again or recommend their agent to others.
Agents and brokers demystify local markets and neighborhoods and provide access to extensive information about available homes. We help prospective buyers determine realistic budgets and research varied financing options, including programs that may be able to help buyers with a down payment.
Seasoned agents and brokers also offer insights into property values, taxes, regulations, and zoning laws while overseeing thorough due diligence processes. And we connect buyers and sellers with other reputable real estate-related professionals such as lawyers, lenders, contractors, and inspectors–any of which can make or break a transaction.
When it comes time to make or evaluate offers, real estate professionals have a decades-long track record as skilled negotiators, ensuring that their clients submit the most competitive bids for their dream home–or hold out for what their home is really worth. And at the settlement table, we help our clients confidently close on what is likely the most significant financial transaction of their lives.
Even post-sale, real estate agents and brokers are crucial advisors for their clients, providing ongoing support, answering queries, and offering guidance as people confront the challenges and delights of homeownership.
NAR’s proposed settlement agreement and the associated practice changes will not change what makes realtors valuable: specialized knowledge, diligence, and a commitment to our clients’ best interests. And it does not change the fact that millions of people will continue to rely on us to help them fulfill their dream of homeownership.
Tim Hur is NAR’s 2024 REALTOR Party Community Engagement Liaison and a seasoned real estate professional with 15 years of experience. He is managing broker for Point Honors and Associates, REALTORS, a boutique real estate firm in Metro Atlanta.
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