Cushman & Wakefield and DTZ will merge, creating one of industry’s largest players
Cushman & Wakefield and DTZ have reached an agreement to merge in a $2 billion deal that will create one of the world’s largest real-estate services companies.
The new company, which will operate under the 100-year-old Cushman & Wakefield brand, will have revenues of more than $5.5 billion and more than 43,000 employees.
The company will manage more than 4 billion square feet of space globally on behalf of institutional, corporate and private clients. The new scale is expected to put the company in a league with global commercial real-estate giants CBRE and JLL.
Before coming to an agreement on a merger, DTZ and Cushman & Wakefield were about the same size, with DTZ reporting $2.9 billion in annual revenue in 2014 and Cushman reporting $2.1 billion in revenue.
A small slice of the new mega player is located in the Richmond area, and its president sees the deal as a good thing for Cushman & Wakefield | Thalhimer.
“The merger is a positive event for us and our clients. Through the merger Cushman & Wakefield will grow strong and will be able to offer enhanced coverage and service to our clients,” said Lee Warfield, president of Thalhimer.
Warfield does not expect any of Thalhimer’s employees to be let go as a result of the deal. In terms of any change in strategic direction, he said, “Once the new entity emerges, we expect service enhancements from C&W. As for Thalhimer, we will continue in a direction that serves our clients best.”
Thalhimer, whose corporate headquarters is located in the Short Pump corridor in Henrico County, is one of the region’s largest real estate brokerages. The firm’s 10 offices in Virginia, North Carolina and South Carolina offices completed 350 lease transactions totaling more than 3 million square feet with a transactional value of over $199.6 million during the first quarter.
Including sales transactions of more than $290 million, the company said its year-to-date volume exceeds $490 million, which is slightly ahead of figures for the same time in 2014.
In its news release on the deal, Chicago-based DTZ said the merged company’s offerings will provide a combination of deep, local market presence with significant scale in core services in the major global markets.
“DTZ is elated to be merging under the prominent Cushman & Wakefield brand. The companies have remarkably complementary skills and reach in different geographies – whether in New York, London or Shanghai. This will be a formidable combination,” Brett White, who will assume the role of chairman and CEO of the combined company, said in a statement.
“While breadth and depth are important to serve clients, “ he added, “it’s not just about size. It’s also about local expertise and deep customer service, which are strong traits of Cushman & Wakefield and DTZ, and ultimately what will differentiate us going forward.”
DTZ is a familiar name in Northern Virginia, where the company purchased Cassidy Turley earlier this year. Some industry analysts are predicting layoffs in large markets where both Cushman and DTZ compete.
Upon completion of the merger, Carlo Barel di Sant’Albano, current International CEO of Cushman & Wakefield, based in New York, will take a senior global leadership role. John Santora, current CEO of North America at Cushman & Wakefield, will become chief operating officer. Tod Lickerman, current global CEO of DTZ, will assume the president’s role.
The transaction is expected to close before the end of the year and is subject to customary closing conditions.