How public brokerages are shaking up CRE: TRD forum

“I would imagine CBRE, JLL have another round of big consolidation in them,” Riguardi says

TRD New York /
May.May 15, 2018 08:00 AM

Konrad Putzier, Joanne Podell, Peter Riguardi and Dustin Stolly (Credit: Jhila Farzaneh for The Real Deal)

Until about five months ago, two out of the four big commercial real estate brokerages in New York City were public companies. And by the time another five months are up, it’s likely that the last of the Big Four will complete its initial public offering.

And that means brokerages suddenly have deep pockets to shake things up.

“I think other brokers have benefited from these public companies and their significant war chests,” Dustin Stolly, co-head of the debt and structured finance team at Newmark Knight Frank, said Monday afternoon during a panel on commercial brokerage at The Real Deal’s 11th Annual New York Showcase and Forum.

Related: Manhattan’s office and resi markets still have
plenty of room to grow, developers say at TRD forum

Stolly, who joined Newmark a few months before the company issued its IPO, illustrated the impact going public can have on brokers by pointing to the signing bonus Cushman and Wakefield gave the star investment-sales team headed by Doug Harmon and Adam Spies. The brokers, he said, “broke the barrier of sound.”

“Our company is offering good brokers significant sums of money,” Stolly said on the panel, moderated by TRD’s Konrad Putzier. “Barry Gosin, our CEO, spends pretty much every second of his time recruiting folks around the country.”

When Newmark Knight Frank’s parent company took it public in December, the brokerage joined the ranks of CBRE and JLL that trade on Wall Street. And Cushman is expected to go public later this year.

Peter Riguardi, president of the tri-state region for JLL, said being a public company puts a firm in another level when it comes to competing for clients.

Related: Construction pros talk tension
between 
union, nonunion labor at TRD forum

“We had some very large, strategic clients that, quite frankly, I think at the end of the day are only considering two firms for certain types for work,” he said.

“I think you mean three firms,” interjected Cushman’s Joanne Podell.

“No, I don’t,” Riguardi shot back.  “I mean two.”

Of course, the shakeout from Newmark’s IPO is already being felt, as the firm is in talks to acquire retail brokerage RKF.

Riguardi said he thinks firms like CBRE and JLL “have another round of big consolidation in them.”

“I could see a day when there’s more consolidation. It has to be in a spot though where there’s not too much duplication, where there’s natural fits,” he said. “If you look at the demands and needs of clients on a global basis . . . I think it becomes harder and harder for small firms to compete.”


Related Articles

arrow_forward_ios
Knotel CEO Amol Sarva and Sprinklr CEO Ragy Thomas with 29 West 35th Street (Sarva via Sasha Maslov; Getty; Google Maps)

Manhattan landlords sue Knotel, Sprinklr for missing rent

Manhattan landlords sue Knotel, Sprinklr for missing rent
(iStock)

Is winter coming? Real estate stocks dragged down by 4th week of market decline

Is winter coming? Real estate stocks dragged down by 4th week of market decline
From left: Michael Fuchs, Aby Rosen, Brandon Singer and Michael Cody (Getty, iStock)

Aby Rosen, Michael Fuchs back new retail brokerage

Aby Rosen, Michael Fuchs back new retail brokerage
Companies are relying on surveys and other data points to determine who will come back to offices first. (iStock)

How do companies decide who should return to offices first? It’s tricky

How do companies decide who should return to offices first? It’s tricky
UDR President Jeffrey Davis, AvalonBay Timothy Naughton Equity Residential's Sam Zell (LinkedIn; AvalonBay; Getty)

Investors bank on urban real estate comeback

Investors bank on urban real estate comeback
HelloFresh’s NYC HQ (Courtesy of Industry City, HelloFresh by Eric Laignel)

HelloFresh inks Industry City deal for content studio

HelloFresh inks Industry City deal for content studio
A rendering of the Climate Solutions Center with Trust for Governors Island CEO Clare Newman and Mayor de Blasio (Rendering via WXY architecture + urban design/bloomimages; Governor's Island; Getty)

Going green: Governors Island could soon house climate center

Going green: Governors Island could soon house climate center
Nightingale’s Eli Schwartz and 111 Wall Street (Credit: Google Maps)

Nightingale, Wafra seek $860M to redevelop 111 Wall Street

Nightingale, Wafra seek $860M to redevelop 111 Wall Street
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...