NAI, C-III Merger Finalized, Signals Larger Trend

In a deal that took six months to finalize, C-III Capital Partners L.L.C. has completed its acquisition of NAI Global, the largest network of independent commercial real estate firms worldwide.

January 26, 2012
By Nicholas Ziegler, News Editor

Finn (left) of NAI and Farkas of C-III

In a deal that took six months to finalize, C-III Capital Partners L.L.C. has completed its acquisition of NAI Global, the largest network of independent commercial real estate firms worldwide. Under the arrangement, NAI will continue to operate as a separate company under its current management, including the leadership of president & CEO Jeffrey Finn.

Saying he was “thrilled to be joining forces with C-III,” Finn noted that his firm will use C-III’s “great resources and expertise to help C-III’s clients strategically optimize their commercial real estate assets.”

C-III’s CEO, Andrew Farkas, was had similar sentiments, noting that his firm was “gaining the world’s leading commercial real estate network and a tremendous foundation for future growth.” Farkas was also chairman & CEO of Insignia Financial Group Inc. prior to the firm’s merger with CBRE Group Inc. in 2003.

With C-III’s nearly $150 billion in assets and NAI’s staff of 5,000 employees – as well as a presence is 55 countries – the merger will augment services on both sides. And the merger route is becoming increasingly popular in a crowded CRE environment. In November, four Montana firms combined efforts to create Catalyst, which became an independently owned affiliate of Grubb & Ellis Co. In the same month, L.A.-based Lee & Associates merged with Sierra to open a New York City office.

“There’s growing consolidation in real estate just as there is in corporate America,” Stan Ross, chairman of the USC Lusk Center for Real Estate, told Commercial Property Executive when the NAI/C-III merger was announced. “Businesses are looking to reduce overhead and become more efficient and more effective, so the real estate industry is doing the same thing.”

“With mergers, you wind up with a stronger balance sheet, so it gives you access to more opportunities, to larger opportunities,” Ross said. “That’s what’s taking place in this country, slow growth but bottom-line earnings. The end result is, across the whole country, we’ll see consolidation — banks, financial institutions and services companies, as well as development companies.”