CHICAGO -- The real estate company of the future is not going to be operated like an open cockpit biplane where seat-of-the-pants aerial ability will enable the pilot to fly high.
Instead, real estate firms in 2000 are going to be run a lot more like a computerized jumbo jet where only sophisticated coordination will ensure proper takeoff.
The outline of the 21st century real estate company has been emerging in the last few years as companies scramble to compete in an era of lower demand for office space and a tightening supply of development capital.
One of the clearest pictures of the structure of the future real estate company is contained in a new study prepared for the Chicago Tribune by the Chicago real estate consulting firm Ferguson Partners Ltd.
"The objective was for us to project the real estate company of the future and identify the career development of people who would be trained to lead that type of organization," said William Ferguson, managing partner of the firm.
As institutions such as pension funds and life insurance companies continue to increase the amount of real estate they own, "there will be an evolution of real estate firms toward more global, diversified service companies," Mr. Ferguson believes.
"The institutionalization of real estate will require a new structure in our industry," agreed Eugene Carver, president of the American Society of Real Estate Counselors.
"Developers are used to walking their projects in the morning, maybe talking with the property manager later in the day and then getting things done," Mr. Carver said.
"Institutions are much slower to react, and depend on information much more than on seat-of-pants instinct."
To get a handle on where the real estate company of the future is headed, Ferguson's Lynn Cherney interviewed the heads of seven leading academic real estate programs at these colleges and universities: The Wharton School in Philadelphia, Southern Methodist University in Dallas, University of Georgia in Athens, University of North Carolina in Chapel Hill, University of Michigan in Ann Arbor, University of California at Berkeley and the University of Wisconsin in Madison.
Ms. Cherney's work was combined with that of John F. C. Parsons and Jorge Valencia, who do strategic planning with Ferguson's clients, which range from insurance companies to pension funds to banks.
"The people coming out of business schools today and entering real estate careers can expect to be part of a larger organization that will need more generalists than specialists," Mr. Ferguson said.
"They are going to follow career paths more like at General Mills, needing experience in finance, marketing and manufacturing."
Real estate programs at the seven schools surveyed already have become more generalized, Ms. Cherney said.
"Real estate students are already taking European studies courses, environmental studies courses and language classes, even at a time when other master's degree programs are becoming more specialized," Ms. Cherney said.
"Once students graduate, they are expecting to enter a training program at whatever company they land with, in essence learning the business by carrying someone else's bags first," she said. "Instead of preparing for a very small, entrepreneurial company, they're preparing for a different type company altogether."
Most companies in 2000 will still offer development, brokerage, asset management and advisory services. But at least three parts of the real estate firm of the future will look much different than today.
* International. Most real estate firms will have an international subsidiary with its own management team and staff, or be part of a network that has international contacts. Europe, South America, the Far East and Mexico are likely focuses, Mr. Ferguson believes.
* Environment. As concern over the environment continues to mount, real estate firms are likely to create senior management positions in environmental affairs.
"Real estate companies are perceived as having the ability to change or damage the environment and they will have to show muchmore sensitivity," Mr. Ferguson said.
* Government. The age has passed when all developers had to do was show up at planning commission hearings with their attorneys and await approval of their project drawings. An entire department in the real estate company of the future will be devoted to governmental affairs, Mr. Ferguson said.
"Given both the growth and the decay we've seen in urban areas, the whole issue of urban planning will be more important to the real estate organization of the 1990s," he said.
Real estate firms are also going to have to give up a large measure of their independence, Mr. Parsons said, because they will be forced to work much more closely with capital sources and corporate clients who will demand more accountability.