DTZ, a leading global commercial real estate firm, has reached a definitive agreement to acquire Cushman & Wakefield from Exor for $2.04 billion. The merger would create a commercial real estate services company with over $5.5 billion in annual revenue, 43,000 employees, and more than 4 billion sf in its global real estate management portfolio.
The combined company intends to keep the Cushman & Wakefield name. The deal, which is subject to regulatory approval, is expected to be completed by the end of this year.
The DTZ-Cushman marriage would create a company whose revenue from brokerage fees roughly equals that of JLL, which has been the second-largest commercial real estate services entity behind CRBE.
Cushman & Wakefield, which was founded in 1917, has 259 offices in 60 countries. In April, it acquired J.F. McKinney + Associates, a leading leasing firm representing over 16 million sf of Chicago-area office space.
Chicago-based DTZ operates from more than 260 offices in 50 countries that completed $63 billion in transaction volume last year. DTZ reportedly has been interested in merging with Cushman for several years.
“It’s not just about size. It’s also about local expertise and deep customer service,” said Brett White, the former CRBE Chief Executive, who became DTZ’s Executive Chairman in March, and will be Chairman and CEO of the combined company.
The DTZ-Cushman marriage would create a company whose revenue from brokerage fees roughly equals that of JLL, which has been the second-largest commercial real estate services entity behind CRBE. According to The Wall Street Journal, CBRE’s 2014 revenue was $9 billion, JLL’s $5.4 billion.
Last November, a private equity consortium backed by TPG Capital, PAG Asia Capital, and Ontario Teachers’ Pension Plan, paid the Australia-based engineering firm UGL $1.1 billion to buy DTZ. At the time, DTZ was in the process of acquiring the New York-based commercial real estate brokerage Cassidy Turley. That deal was finalized in January, and the two firms were merged, creating a company with $2.9 billion in annual revenue, more than 28,000 employees, managing 1.9 billion sf of property and 1.3 billion sf of facilities for institutional, government, corporate, and private clients.
Exor SpA—which gets $1.28 billion in net proceeds from its part of the Cushman sale—is owned by the Agnelli family, reputedly the largest shareholder in Fiat Chrysler Automobiles. Exor has stated it plans to proceed with its merger with Axis capital Holdings.
Details about combining DTZ and Cushman—such as how market or portfolio overlaps will be reconciled—have yet to be disclosed. But the management team has already begun to take shape.
Once this deal is completed, Tod Lickerman, DTZ’s chief executive (and JLL’s former CEO), will become president of the new company. Cushman’s North America chief executive, John Santora, will hold titles of COO and chief integration officer. Carlo Barel di Sant’Albano, Cushman’s international chief executive, will take a senior global leadership role at the combined company. Edward Forst, Cushman’s CEO, is expected to leave the company.
Millbank, Tweed, Hadley & McCloy advised Cushman in this deal.
Related Stories
| Jan 29, 2014
Hotel, retail, recreation sectors to lead growth in 2014
AIA's Consensus Construction Forecast, a survey of the nation’s leading construction forecasters, is projecting that spending will see a 5.8% increase in 2014, led by the hotel, retail, and amusement/recreation sectors.
| Jan 29, 2014
Notre Dame to expand football stadium in largest project in school history
The $400 million Campus Crossroads Project will add more than 750,000 sf of academic, student life, and athletic space in three new buildings attached to the school's iconic football stadium.
| Jan 28, 2014
White Paper: How metal buildings deliver long-term value to schools
A new white paper from Star Building Systems outlines the benefits of metal buildings for public and private school building projects.
| Jan 28, 2014
First Look: BIG's Honeycomb building for Bahamas resort [slideshow]
BIG + HKS + MDA have unveiled the design for the new Honeycomb building and adjacent plaza in The Bahamas – a 175,000-sf residential facility with a private pool on each balcony.
| Jan 28, 2014
2014 predictions for skyscraper construction: More twisting towers, mega-tall projects, and 'superslim' designs
Experts from the Council on Tall Buildings and Urban Habitat release their 2014 construction forecast for the worldwide high-rise industry.
| Jan 28, 2014
16 awe-inspiring interior designs from around the world [slideshow]
The International Interior Design Association released the winners of its 4th Annual Global Excellence Awards. Here's a recap of the winning projects.
| Jan 28, 2014
Big Ten Conference opens swanky HQ and museum [slideshow]
The new mixed-use headquarters includes a museum, broadcast studios, conference facilities, office spaces, and, oh yeah, a Brazilian steakhouse.
| Jan 27, 2014
A climber's dream: Rock climbing hall planned near Iran's highest peak
Forget the rock climbing wall. A developer in Iran is building a rock climbing hall. That's right, an entire building dedicated to the sport, with more than 48,000 sf of program space.
| Jan 24, 2014
First look: Foster + Partners' new home for Yale School of Management [slideshow]
Edward P. Evans Hall, the new home of the Yale School of Management, has opened for business. The 242,000-sf facility was designed by Foster + Partners, with Gruzen Samton as architect of record.
| Jan 24, 2014
Reed Expansion Index predicts widespread economic improvement for the year
Reed's December Expansion Index stood at 1.48, indicating overall construction in the United States is expected to grow over the next 12 months.