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The Times They Are A-Changin’: Movement in the Retail Brokerage Industry

When selecting a broker, clients consider a host of factors, including both the firm’s and individual broker’s experience, building and client portfolio, and industry contacts. While some may feel better served by a small, dedicated team that can arguably offer more personalized service, many elect to engage larger industry players. Larger shops tend to invest greater sums on marketing and new technology to stay ahead of the game and drive business. There appears to be a growing trend of firms consolidating and going public.

In order to raise the capital to compete in years past, some of the largest brokerage firms took the step of becoming a publicly traded and owned entity. Jones Lang LaSalle (NYSE: JLL) went public in 1997 and has completed over sixty (60) strategic acquisitions globally since 2005. CBRE (NYSE: CBRE) touts itself as the world’s largest commercial real estate services and investment firm; a public company since 2004, the firm boasted revenues of $14.2 billion in 2017. These firms are trading at record highs.

Now, more firms are taking this approach. Newmark Knight Frank (NASDAQ: NMRK) recently made the leap, closing 20 million shares in December 2017. The firm has since agreed to purchase retail real estate brokerage firm RKF in an effort to grow and expand its retail capabilities. Similarly, after being acquired last year by European real estate services firm DTZ’s parent company TPG, a private equity firm, for $2 billion, Cushman and Wakefield filed in July for its upcoming IPO, where the firm will look to raise upwards of $810 million.  Some have suggested that the success – or failure – of the IPO “could be a Wall Street referendum on the current economic expansion.” 

According to Ted Lundeen, a Director at Meridian Capital Group, “Brokerage firms that are able to offer their clients multiple services, at scale, while remaining nimble and innovative are thriving and able to better adapt to market changes.” The largest firms often have the broadest network and scope of services to offer clients, which can increase such firms’ chances to win ever important exclusives from major national and global retail chains. Replete with resources, a large commercial brokerage firm may have more potential tenants in queue to tour a landlord’s space. For tenants, a large brokerage firm may mean access to more options to consider and evaluate before making the big decision. 

While there are certainly boutique firms that excel and thrive, the advantages available to the largest industry leaders have led some smaller firms to find it difficult to compete. Indeed, several prominent market players have at times struggled and been forced to consolidate or cease operations over the past several years, including Town Residential this spring and Eastern Consolidated over the summer.

The coming public offerings should be a good barometer of investor’s comfort with the real estate market.

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Jeffrey Pike's picture

Jeffrey Pike is a real estate lawyer who focuses on commercial real estate financing, including construction, permanent and mezzanine loans, as well as acquisitions, dispositions and development matters.

He works with developers, owners and joint ventures that acquire and finance office, retail, multi-family and mixed use properties across the country. Jeffrey performs critical research, drafts documents and negotiates matters related to a wide range of real estate projects.

Prior to joining Goulston & Storrs, Jeffrey served as an intern with the U.S. Department of the Interior in the Office of the Solicitor. He also participated in the Community Enterprise Clinic at the Boston College Legal Assistance Bureau where he assisted local businesses on a variety of transactional matters.


Hara, a Director at the firm, helped structure some of the more significant neighborhood-transforming real estate transactions in New York City in recent years, including Essex Crossing (on the public side) and Cornell Tech’s Roosevelt Island Campus (on the private side). Her consensus-building approach delivers long-term value to her clients, as many transactions involve lasting relationships through joint ventures, ground leases or condominium regimes.  

Hara is recognized nationally as an expert in housing and economic development. She has negotiated low income housing tax credit transactions investing over $1 billion in affordable housing, on behalf of developers and investors. She co-chairs the firm’s Multifamily Housing Industry group and speaks regularly on trends and changes in the industry. 

Prior to joining the firm, Hara clerked for the United States Court of Appeals for the Second Circuit.