Transwestern’s Global Expansion
- Jun 10, 2013
When Transwestern announced it would manage a 2 million-square-foot portfolio in the New York City region for the Metropolitan Transportation Authority, the news was significant—and not only because of the size of the contract. The high-profile assignment for the Houston-based firm came just two years after it established a New York City office.
“That was a huge management assignment and a chance for us to really tout what we consider some of the core competencies and strengths: our sustainability practice and our management practice,” said Chip Clarke, president for the Americas.
The MTA deal, approved in mid-April, calls for Transwestern to manage 2 Broadway, a 1.6 million-square-foot, 34-story, Class A office tower in Manhattan’s Financial District. It currently houses New York City Transit offices and will become the MTA’s headquarters next year, when it consolidates office space. Transwestern will also oversee management of the Jamaica Control Center, a 165,000-square-foot, Class A office building in Queens, and three suburban MTA buildings, one in Westchester County and two in Nassau County.
While Transwestern had done some work in New York City, it was not until 2011 that the firm opened an office in Manhattan, led by Patrick Robinson, president of the Northeast division, and Lindsay Ornstein, principal.
“We had been in New York but not in any sustainable fashion. We had done some one-off work, but we didn’t really dive into the water like we dove with Patrick and his team,” Clarke added. “I think the results have been really good to date. It’s a testament to the kind of people we have been able to attract.”
Mark Doran, Transwestern’s COO, said it was important for the firm to be in New York City to offer services to all parts of its operations, including occupiers, tenant advisors and institutional owners of real estate, many of which are located in Manhattan.
Transwestern, a private commercial real estate services firm with offices in 33 U.S. cities and nearly 1,900 employees, has been expanding in the United States and abroad in the past few years. Besides opening the New York City office in 2011, Transwestern entered into a joint venture in Saudi Arabia to launch Transwestern MENA. A year later, it formed a global alliance with BNP Paribas Real Estate, allowing it to serve clients in more than 180 offices in 36 countries.
Earlier this year, Clarke, who had been president of the Gulf Coast and Mountain regions, was promoted to his current position as part of a leadership expansion designed to “advance rapid growth” and extend domestic and international services, according to a company release. The new management structure announced by president & CEO Larry Heard and chairman Robert Duncan also included naming Kevin Roberts, previously president of the Central Texas region, to the new position of president for the Southwest and reorganizing the firm’s nine regional U.S. offices into seven territories. Presidents of the seven territories report to Clarke and Doran.
Clarke’s new duties include expanding the firm’s Latin American business. Clarke said Transwestern’s entrée into Latin America came several years ago, when it launched a fund with partners in Colombia that focused on U.S. investments. The next step, expected to be imminent, will be the announcement of a joint venture with an existing Colombia firm on a portfolio of assets.
“The plan is that will be the first flag for us on the services side in Latin America, and we’ve got a strategy to grow not only in Colombia but in Chile and Peru, and a separate strategy for Brazil and Mexico,” Clarke said.
Doran told CPE that the approach with Latin American partnerships will be similar to the alliances it has with BNP Paribas in other parts of the world. “Our focus is to find high-quality companies that have great relationships, similar culture and excellent capability,” he said.
Back in the United States, Doran and Clarke pointed to Boston as the firm’s next goal for expansion after New York City. “We think that market is important for our practice,” Clarke said. “We don’t really have what we’d consider a dot on the map. We strive to have a full-service operation in each one of our markets.”
Clarke said Transwestern is currently striving to “find the right group of people and the right partner to launch. We’re not going to do something that isn’t compatible with the culture of our firm and longtime strategy of our firm.”
Doran and Clarke said Transwestern has looked to more organic growth for expansion rather than merging and acquiring firms. The firm either sends its own people to open a new office or hires like-minded commercial real estate veterans in markets it wants to enter.
“We’d also like to get deeper and broader in the key markets that we’re already in,” Doran added.
The West Coast is a region where Transwestern has had a significant amount of growth, and the firm will continue seeking more market share and adding more people there, he said.
“The key for us is simple: We’re intent on growing, and we’re always going to be strategic about the markets we enter,” Clarke concluded.