NEW YORK — BGC Partners is rapidly integrating Newmark Knight Frank, one of the largest commercial real estate brokerage firms in the U.S. that it acquired in October 2011, with Grubb & Ellis. The new entity, Newmark Grubb Knight Frank, will offer a full-service commercial real estate platform.
On Friday, BGC Partners (Nasdaq: BGCP) announced that it had closed on its acquisition of the assets of Grubb & Ellis Co., following the recent approval of the transaction by the U.S. Bankruptcy Court for the Southern District of New York.
In addition to Grubb & Ellis professionals now joining the combined firm, Newmark Knight Frank has added more than 50 top-producing brokers in offices across the country in the last several months.
“With more than 100 offices in North America, 250 million square feet in property and facilities management, and an outstanding national appraisal business, the creation of Newmark Grubb Knight Frank is a game-changing moment in the real estate industry,” said Michael Lehrman, global head of real estate at BGC Partners, in a prepared statement.
“Newmark Knight Frank and Grubb & Ellis each have consistently ranked among the leading companies in the real estate industry, and now these two great brands have come together as an even more impressive competitive presence in the real estate marketplace,” added Lehrman.
Barry Gosin, CEO of the combined Newmark Grubb Knight Frank, said the new entity embraces a portfolio that includes: management services; capital markets; corporate services; investment sales; leasing; tenant and landlord representation; property and facilities management; industrial engineering; appraisal and valuation services.
“In short, it’s a fresh and comprehensive way of identifying creative, fully integrated solutions to meet clients’ complex real estate objectives by applying BGC’s capital, management and technology as we enlarge the scale of our real estate services platform and expand into new markets,” said Gosin.
Jimmy Kuhn, president of the combined Newmark Grubb Knight Frank, said the newly formed entity has already won significant new mandates. “Clients are telling us that with the proven strengths of Newmark Knight Frank, the investment sales capabilities of Grubb & Ellis and expertise across multiple practice groups, and BGC’s expertise in global capital markets, Newmark Grubb Knight Frank represents one of the most powerful solutions in the real estate industry.”
The integration of the two firms marks the end of an era for Grubb & Ellis. Started in 1958 in San Francisco, the company expanded in the 1960s and 1970s by adding property and asset management, real estate development and insurance brokerage services. During that period, the company also opened and acquired regional offices.
According to the company’s website, its1981 merger with Jacksonville, Florida-based GMR Properties sparked an eastward expansion, and resulted in Grubb & Ellis becoming the first commercial real estate services firm to be publicly traded and listed on the New York Stock Exchange.
Throughout the 1980s, Grubb & Ellis grew rapidly and established a nationwide presence through the acquisition of well-established real estate firms in the Pacific Northwest, Northeast, Southeast, Midwest and Texas.
In the 1990s, the company divested non-core businesses, including its residential business, and focused on its core transaction services and management services businesses. In 1996, the company acquired sole ownership of Axiom Real Estate Management Inc., its property and facilities management subsidiary that originated in 1992 as an independently operated joint venture with IBM Corp. Axiom was renamed Grubb & Ellis Management Services, Inc.
The last decade has been a particularly tumultuous period for the commercial real estate brokerage industry, and Grubb & Ellis in particular. The Santa-Ana, California-based company filed for Chapter 11 bankruptcy protection in February. BGC Partners offered to forgive the $30 million it was owed in exchange for Grubb & Ellis's assets.
Newmark Grubb Knight Frank and its London-based partner Knight Frank together operate from more than 240 offices in established and emerging property markets on five continents.
BGC Partners, a leading global brokerage company servicing the wholesale financial markets and commercial real estate marketplace, has approximately 7,000 employees in New York, London and more than 30 other financial centers around the world, and conducts more than $200 trillion in financial transactions for customers annually.
— Matt Valley