The Real Deal Miami

Grubb out of compliance with New York Stock Exchange standards

By David Jones | April 10, 2011 02:45PM

Grubb & Elllis, one of the nation’s largest commercial real estate brokerages, said it was notified that it was out of compliance with listing standards of the New York Stock Exchange, which requires a minimum $1 a share average closing price for 30 straight days.

The Santa Ana, Calif.-based firm said it has up to six months to cure the deficiency, adding that its current operations and reporting requirements with the Securities and Exchange Commission have not been affected.

The disclosure comes just weeks after Grubb retained JMP Securities as an advisory firm to explore a potential sale or merger of the company. Company Chairman C. Michael Kojaian noted that Grubb had “made progress restructuring the business and driving top-line growth” and that the firm felt it was time to explore ways to best leverage its “broad platform” of businesses. He also noted the firm had received unsolicited inquiries.

By March 30, Grubb said it received an $18 million financing commitment from Los Angeles-based Colony Capital, adding that Colony has 60 days to evaluate the potential of a larger strategic investment.

Grubb reported a net loss of $66.8 million, or $1.21 a share in 2010, compared with a net loss of $78.8 million, or $1.27 a share a year earlier. The firm reported revenue of $575.5 million in 2010, versus $527.9 million the year before.

Grubb was previously warned about NYSE delisting it in 2009 because it had a market capitalization of less than $50 million.

As The Real Deal previously reported, Grubb was nearly acquired prior to the downturn by rival firm Newmark Knight Frank, but the deal was never consummated.

The firm was previously delisted from the NYSE, in 2002.

In September 2010, the company’s appraisal arm, Grubb & Ellis Landauer Valuation Advisory Services, opened its first New York City office at 1177 Sixth Avenue, the 12th office for the unit.
The firm planned to have an appraisal office in every key U.S. market, but it remains unclear how these new developments will impact that plan.

The firm said it reduced corporate overhead expenses by $10 million.