BGC to Acquire ARA for $110M

By Anna Spiewak, Senior News Editor

James Kuhn, NGKF

Global brokerage company BGC Partners, parent of Newmark Grubb Knight Frank, is buying Apartment Realty Advisors for approximately $110 million, according to a BGC press release.

The purchases are expected to greatly drive NGKF’s growth within the multi-housing capital markets space. BGC said it expects the transactions will be immediately accumulative upon closing.

“ARA operates in 28 cities and does $10 billion a year in transactions without NYC metro and southern California. We plan to recruit heavily in those and other markets,” James Kuhn, president of NGKF told Commercial Property Executive.

Additional cash and equity based earn-outs may be paid if certain performance targets are met in future periods. After the closings, they are expected to generate annual revenues in excess of $100 million and pre-tax distributable earnings in excess of $20 million. The transactions, which are each subject to certain closing conditions, are expected to close in stages with a majority expected to close during the fourth quarter of 2014.

According to previous news reports, BGC has been negotiating for months with founding principals of Apartment Realty Advisors.

BGC entered the brokerage business in 2011 when it bought Newmark Knight Frank, then a boutique New York firm, and later merged it with the struggling Grubb & Ellis to form Newmark Grubb Knight Frank. Apartment Realty brokered $6.3 billion in large apartment sales in 2013, making it the third-largest multi-family firm in the U.S. with a 15.1 percent market share, according to the Portland Business Journal.