Transaction Marks a Milestone in Plan of Veteran Exec and Insignia Founder to Build New Full-Service CRE Company
Real estate investment firm C-III Capital Partners LLC completed its acquisition of NAI Global, just 10 days after
negotiations between C-III and partner Colony Capital LLC to acquire Santa Ana, CA-based Grubb & Ellis Co. expired without an agreement. Financial terms of the transaction were not disclosed.
At the time the NAI Global transaction was announced in June 2011, C-III Capital and its veteran CEO Andrew L. Farkas expected it to close in the third quarter. Many industry observers have speculated in recent months about whether the deal would be finalized, especially after C-III announced in October that it was entering into exclusive talks along with Colony to make a strategic transaction with Grubb & Ellis, which competes in many of the same markets as NAI.
Grubb, which has struggled financially since merging with NNN Realty Advisors in 2007, entered talks last week with a third player, BGC Partners, L.P, headed by Cantor Fitzgerald CEO Howard Ludnick.
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In August 2011, New York-based C-III Capital acquired the special servicing and CDO management businesses of JER Partners, and in November, bought U.S. Residential Group in Carrollton, TX, and Pacific West Management in Irvine, CA, two affiliated apartment property management businesses.
NAI Global, based in Princeton, NJ, manages a network of
commercial real estate firms totaling 5,000 professionals and 350 offices in the U.S. and 55 countries around the world. It will continue to operate as a separate company under current management. NAI offices complete more than $45 billion in transactions annually and manage more than 300 million square feet of commercial space.
Jeffrey M. Finn, president and CEO of NAI Global, said in a statement "we are thrilled to be joining forces with C-III and excited about the opportunity to deliver an even broader range of services to our members and add greater value to our collective corporate and investment clients."
"The completion of this transaction represents a significant step forward in our strategy to build a fully diversified commercial real estate services company," said Farkas, who founded Insignia Financial Group, Inc. in 1990.
After taking Insignia public the following year, Farkas built the firm into one of the world’s largest CRE services firms before selling its apartment business to Apartment Investment and Management Co., known as Aimco, (NYSE:
AIV), and selling the remaining company to CB Richard Ellis, now CBRE Group, in 2003.
Farkas launched C-III in March 2010 with the purchase of Centerline Capital Group’s institutional real estate debt-fund management and commercial loan servicing businesses. Using the Insignia template, Farkas planned to use Centerline's asset base to make strategic acquisitions such as NAI Global to create a diversified real estate services company.
Since then, C-III has launched mortgage origination, investment sales and title insurance businesses and expanded its investment, lending and loan servicing operations.