— You can come back home again, according to twin brothers John and Louis Cushman, referring to a recent agreement to merge their company, Cushman Realty, into New York-based Cushman & Wakefield to form a $900 million company.
The merger, expected to close this month, brings John and Louis Cushman back to where they started — Cushman & Wakefield, a firm founded in 1917 by their grandfather, J. Clydesdale Cushman, and great uncle, Bernard Wakefield. The Cushmans also rejoin two cousins: Tom Usher, who is a senior director located at the Portland, Ore.-based C&W office, and Kirk Usher, a senior managing director in the San Francisco office.
“It's emotional in a positive way,” said John Cushman III, president and CEO of Cushman Realty. Cushman explained that real estate is a family tradition, pointing to the seven family generations involved in New York real estate.
John Cushman will become the chairman of the board of the merged company while his brother, Lou, who is the chairman of the board at Cushman Realty, will be the vice chairman. Arthur Mirante, president and CEO of C&W, will retain those titles. Mirante will continue managerial and operational responsibilities, while John Cushman will work to build the company's client roster.
Mirante said the merger infuses C&W with talent, especially in markets such as Southern California, Houston and Denver. “Cushman Realty happens to have extraordinarily talented executives andprofessionals,” he said. Mirante said the similar cultures of the two companies made the merger attractive.
“We're all convinced the timing here is perfect,” Mirante said, adding that the growing sophistication of clients, the increased globalization of the real estate industry and the need for a more connected sales force were other factors that fueled the.
According to John Cushman, C&W offers many benefits to Cushman Realty. “It has a massive platform that's going to be great for our people,” he explained. Cushman said the fact that C&W is global, with offices in 49 countries, will provide Cushman Realty “the ability to capitalize on its strengths immediately.”
The merger will further bolster C&W, which already was the largest real estate firm in the world prior to the deal. Up to 200 Cushman Realty employees, including 90 brokers, will join C&W's staff of 875 brokers. C&W estimates the merger will create a company with annual revenues of approximately $900 million, based upon the two companies' combined revenues in 2000. On its own, C&W produced $820 million in revenues on 8,845 transactions with an aggregate value of $32 billion last year. During the same time period, Cushman Realty closed nearly 2,000 transactions with an aggregate value of approximately $5 billion.
The merger is part of C&W's restructuring plan, noted Bruce Mosler, president of U.S. operations at C&W. “We were looking to round out our game plan,” Mosler said.
Although the two companies are looking forward to the benefits of the merger, Mosler noted that every reorganization presents challenges.
To make the transition as easy as possible, the two companies have formed an integration team. All of the players expected the process to go smoothly due to the two companies' similar mindsets. The deal should be finalized this month following due diligence and board approvals.
John and Louis Cushman left Cushman & Wakefield in 1978 to form Cushman Realty. John Cushman was executive vice president at C&W and a member of the board. He also opened up the company'soffice. Lou Cushman was senior vice president of C&W and an executive vice president and director of C&W of Texas. He joined the company in 1967 and worked out of the Wall Street office until 1971, when he relocated to Houston to head up a C&W branch in that city.
This merger cannot be termed a surprise. John Cushman and Mirante had discussed the possibility of a merger periodically over the past 10 years. During that time, the two competed against each other, winning some deals and losing others along the way. Throughout that time, they held a mutual respect for each other.
Now Mirante is glad the two Cushman brothers are rejoining the C&W team. Louis and John Cushman are coming home.