Melbourne Market Update – Spring 20192nd October 2019 / Market Updates
Springtime in Melbourne… The crowds are gathering for the usual array of significant events such as the AFL Grand Final and Melbourne Cup, not to mention the attendance at the Global Climate Strike on the 20th September. The Strike saw a huge turnout and was a major event for the Architecture and Design industry considering it’s potential to lead, change and shape outcomes in this crucial area.
From a market activity perspective, consistency has returned to the market after the first half of the year. Earlier, we saw up’s and downs primarily to do with the long-running Banking Royal Commission and the May Federal Election. With both of those now behind us, confidence levels are higher, resulting in a more consistent recruitment environment generally.
Several uncertainties during the first half of the year resulted in some studios making redundancies, others recruiting staff and others sitting in the middle in “hold tight mode”. There has been a small number of business closures across the development, construction, design sectors. Along with slowing real estate prices in the headlines, it made for a period where confidence levels were suffering. In this period, virtually all sectors were experiencing lower activity levels than in the previous 2 years.
Despite significant international events such as Brexit, trade-wars and issues in the Middle East splashed across the media; locally, the market seems to be stable as we approach the end of the year.
Following changes to the way projects are financed (particularly medium density residential), we have seen longer breaks between project stages. Early conversations about new finance models supporting “build to rent” or “rent to buy” type projects are starting to increase. Activity is expected to continue in these areas into 2020, and with interest rates now having dropped to historic lows, impetus appears to be coming back into the real estate market.
Whilst positive, this new finance model may add an element of complexity when resourcing, managing and delivering projects, with finance more likely to go on hold at certain project stages. With slightly tighter market conditions, tougher fees are something that many studios are contending with within a competitive market.
Our current positions still suggest high levels of activity across the board, though with changes in the mix of projects along with budgets. It is hard to pin-point a consistently busy sector, as some practices who are working in a specific typology are busy, others are quiet.
The apartment market is showing positive signs in recent months, and the usual model of great site, great design, great amenity, and a cashed-up developer continuing to achieve positive results.
An increase of commercial projects in the smaller to the mid-scale area seems stable. With many large-scale commercial buildings that began construction in the past 12 months due to finish up in 2020, new projects in the pipeline are tending to be mid-scale rather than large.
Highly technical projects including pharmaceutical, bio-medical, rail and Aviation are creating compelling new roles, and Aged Care is on the up. However, a limited number of key players in these sectors mean roles are not widespread.
We have seen a number of new hotel projects committing and these are generally a part of a mixed-use development with a broad range of facilities in the overall project mix. Education, health and institutional sectors have seen an increase in new projects commencing. However, build-value, scale and method of engaging Architectural studios still makes for a tough sector. Infrastructure spending remains strong in the background, and studios active in this area anticipate further spending on rail, road and infrastructure projects generally from the State Government.
The Interior Design market remains solid, with commercial, apartment and hospitality projects strongly in the mix of our recruitment in the past three months, and these roles continue to come through in steady levels. Some are high profile larger projects with significant demand for new team members, along with activity in the smaller scale, high-end boutique hospitality area.
With the above in mind, recruitment trends and activities have seen the team here in Melbourne working effectively to fill project-specific contract positions through to key strategic roles at Associate level and above.
We are currently looking for Associate level Architects with strong client and team leadership abilities as well as financial acumen based on various studios working hard on strategic growth and succession planning. Studio Management roles for Architects and Interior Designers are also on the up, with firms seeking those who have more of a management focus and see their careers heading in this direction. Other strategic roles include head of Interiors for several leading design studios and specific high-end roles such as Education, Science and Technology leader roles at Principal level.
While these roles only represent a fraction of highly qualified professionals, we continue to recruit Architects, Architectural Technicians and Interior Designers with design, project leadership or technical capabilities. Naturally, Revit is an expected part of the overall skill mix by clients.
Interior Design roles requiring BIM experience has now caught up with Architecture. Revit has now reached a point where it is the Industry Standard and opportunities across the board are scarce for those without Revit software experience.
Rates & Salaries
Present opportunities are a mix of both contract and permanent salaried roles. In recent weeks we have seen an increase of immediate start contract roles for technical documentation positions with some tight end of year deadlines looming large. In addition to this, we are seeing strong demand for Revit based technicians on some exciting long term projects, and many of these are salaried roles.
Rates and Salaries have been a hot topic of discussion from mid-year reviews, and we anticipate activity in this area as we go into the end of the year with the end of year reviews.
Salary increases were smaller at mid-year this year than 12 months before, with many only moving at CPI levels given the market at the time, and some with little or no movement other than Award based increases. This may potentially be the case again late in the year, as many firms may be looking actively for new project commitments. Otherwise, as in such markets, firms look to February-March to have confirmed workloads into 2020. Anyone wanting our current rates and salary guidelines can email Gemma Hillas on [email protected] for current up to date schedules.
We have also seen an increase of broader support roles now contributing to the “fabric” of skills within design studios. An increasing amount of positions listed focus on business development, content and submissions management, social media, along with other roles focusing on client services. These roles are often newly created for practices and reflect the broad mix of skills required within the Design sphere as technology and client needs continue to evolve at a fast pace.
Design based technology advancements continue to be an exciting part of our roles here. Many studios are on the lookout for talented people with cutting edge technology skills who can bring efficiencies to practices. Consequently, there are some outstanding career roles available for those with parametric design skills and BIM leadership.
In a continually changing environment, Bloomfield Tremayne continues to offer permanent and hourly rate engagement methods that give excellent flexibility to client groups of all sizes. Our service offers transparent fee structures and clear options dependent on what your specific needs are.
For more information on these options and which method best suits you, please contact Bruce Whetters on [email protected] for more information.
A final note as we head into the end of the year – it’s the time where many Graduates of Architecture, Interior Design and Building Design are looking for their first full-time role in the industry. This can be one of the most competitive times in their career so if you are thinking of Graduate recruitment now or in the New Year, please let us know.
Email [email protected] if you are thinking of hiring some of the talented Graduates soon to be entering the industry.
Thanks for having a read – if you would like more information in regards to your recruitment needs or like more detailed information on any of the above areas, please let me know! [email protected]
Partner – BT&P Melbourne