Newmark nearing deal to buy RKF: sources
Newly public global brokerage seeks NYC retail advantage
On the heels of a lukewarm initial public offering, Newmark Knight Frank is close to acquiring the commercial brokerage RKF to grow its New York City retail operation, The Real Deal has learned.
Sources said Newmark is in advanced discussions to buy the Midtown-based retail leasing and investment sales brokerage for an undisclosed price.
The sale is expected to close sometime in the first quarter, sources familiar with negotiations said.
Sources said RKF, led by Robert Futterman, is in the process of signing several brokers to long-term contracts. Another source said Futterman himself is expected to stay on after the deal, at least in the near term, with an unspecified role. The parties are also still sorting out the fate of the RKF name.
Representatives for neither firm immediately responded to requests for comment.
The acquisition comes at a pivotal point for Newmark. The firm launched an IPO on Dec. 15 to disappointing results. Newmark planned to sell 30 million shares for $19 to $22, but instead sold 20 million for $14 each. The share price has since risen slightly.
The deal would seek to give Newmark its multinational commercial brokerage operation a significant boost in New York City retail, a category in which RKF is a powerhouse. Newmark and RKF are two of the most active brokerages for retail leasing in the city. In TRD’s December ranking of the top Manhattan retail brokerages, RKF was No. 1 with 1.1 million square feet across 203 deals and Newmark took third place with 424,808 square feet across 33 deals. (Cushman & Wakefield ranked second.)
RKF’s top 2017 deals included Nordstrom Rack’s 47,267-square-foot lease at the Durst Organization’s 855 Sixth Avenue and Lionsgate Entertainment recently inked a 45,000-square-foot lease for a movie studio and entertainment center at SJP Properties’ 11 Times Square.
While RKF is heavily focused on New York retail, Newmark has a team of star brokers including Jeffrey Roseman, Jason Pruger and Drew Weiss.
Futterman founded RKF, then known as Robert K. Futterman & Associates, in 1998 after working at the retail brokerage Garrick-Aug Associates.
In recent years, RKF has engaged in talks of a sale with other commercial brokerages, including CBRE in 2014 and Colliers International in 2015. None of those deals made it to the finish line, however. At the time of those talks, industry insiders pegged the value of the company between $40 million and $80 million.
Newmark started as a family firm in 1929, and in 2005 it formed a partnership with London’s Knight Frank. Howard Lutnick’s BGC Partners had owned Newmark since 2011, when it paid $99 million in cash and shares. Now that Newmark has spun off from BGC, Lutnick’s firm owns 85 percent of Newmark’s Class A common stock.
Konrad Putzier and James Kleimann contributed reporting.