Commercial real estate brokerage Newmark Group's earnings beat expectations as a burst of office and retail deals sent sales up more than 20%.
Despite the rosy first-quarter report, executives remain guarded about the global firm's outlook for the rest of the year because of uncertainty over the effects of shifting U.S. policy on tariffs.
"We're seeing deals continue to go through," CEO Barry Gosin told investors during the company's earnings call Wednesday. "Right now, the uncertainty is annoying and concerning, but things are still trading. We'll see what happens over the next 90 days."
The New York City-based firm reported a nearly 22% gain in revenue to $666.5 million, beating analyst expectations by nearly 10%. Both leasing and capital markets — including property sales and financing — jumped by nearly a third over the prior-year period. The company's per-share earnings also exceeded estimates.
Robust office and retail leasing and sales drove the increases, including a 63% gain in property sales and loan volume from the same time last year.
Newmark executives joined those from CBRE and Cushman & Wakefield, the first two national brokerages to result results, in taking a guarded approach to the rest of the year.
For the full year, Newmark held to its outlook in February that revenue will grow between 6% and 13% over last year's total revenue of $2.73 billion.
However, the tariffs and other potential geopolitical headwinds could curb industry activity, executives warned.
“While our revenue pipeline continues to show growth into the second quarter, it is difficult to predict the impact, if any, that tariffs and interest rate volatility may have on our results,” said Newmark Chief Financial Officer Mike Rispoli.
Executives expect full-year growth in capital markets revenue to exceed 9%, the midpoint of its guidance range, with leasing revenue expected to climb at a slightly lower rate.
Revenue in Newmark’s services business increased 10.5% to $283.9 million, led by strong growth in the company’s valuation and advisory practice.
The company saw new and expanded client contracts for property and facilities management and other outsourced services.
JLL, Colliers and Marcus & Millichap are scheduled to report results next week.