Demand for real estate product not only benefitted sellers in 2004, but it also proved to be a boon for the nation's largest commercial real estate brokerages. Investment-grade office properties, for example, surpassed the $200 per sq. ft. sales mark for the first time ever, reports CoStar Group. On average, sale prices climbed 5.25% for the year.

“Real estate today is more liquid than ever before, and by a wide margin,” says Nicholas Buss, senior vice president of real estate market research at PNC Real Estate Finance. “This weight of capital, and the competition it has created, pushed prices up and yields down.”

Buss notes that total sales of institutional real estate jumped 50% to $180 billion in 2004. Meanwhile, the commercial debt market increased 10% to $2.2 trillion. The reason, says Buss, is that yield-oriented investors continued to flock to real estate in record numbers.

Case in point: Manhattan-based Cushman & Wakefield posted a record year for investment sales thanks to $17.5 billion worth of deals. According to executive managing director Tim Welch, that volume was more than double what Cushman & Wakefield transacted in 2003.

“We did $7.3 billion worth of deals in 2003,” says Welch. “And now in late March, we are 50% ahead of where we were in 2003 in terms of our deal pipeline,” he adds.

CB Richard Ellis easily maintained its top spot on NREI's list of top brokerages. The total value of investment sales and leasing transactions generated in CBRE's shop in 2004 was valued at $127.4 billion, up from $83 billion in 2003.

Notable deals

A combination of limited offerings and aggressive buyers helped several owners fetch sky-high prices in 2004. Real Capital Analytics reports that a Beverly Hills property on Rodeo Drive sold for a whopping $2,667 per sq. ft. The second largest deal of 2004 on the basis of sq. ft. was 517-521 Lexington Ave. in Manhattan, which sold for $1,779 per sq. ft.

On the leasing side, the largest deal of the year was signed at Manhattan's Bank of America Tower, a 1.1 million sq. ft. building under development. Jones Lang LaSalle, No. 6 on this year's ranking, represented anchor tenant Bank of America in that deal.

The third largest leasing deal of 2004 was signed in the nation's stronghold office market, Washington, D.C. Cushman & Wakefield brokered corporate Executive Board's 625,062 sq. ft. lease at Rosslyn's Waterview building.

Ranking changes

Some firms slipped in this year's rankings. NAI Global, for example, lost its No. 4 spot to Grubb & Ellis. The Northbrook, Ill.-based brokerage was ranked No. 5 in last year's survey, but a strong showing helped the company improve by one notch.

The tide may be turning for Grubb & Ellis, too. In March the firm finally named a CEO, Mark Rose, after 12 months without one in place. Rose previously spent 12 years at Jones Lang LaSalle.

It's anyone's guess whether the torrid market of 2004 will live on or be remembered as the beginning of the end. For his part, PNC's Buss believes that moderate job growth this year should help shore up fundamentals in the office market.

He projects that the office vacancy rate in most major markets will dip below 15% by the end of 2005. Still, he doubts that this improvement will be enough to give landlords pricing power.

“The office sector was the most challenged in 2004, but it has steadily improved,” says Buss. “But real estate in general must be cautious in 2005 about potentially finding itself vulnerable if fickle investors chase better returns in another sector.”

TOP THREE SALES DEALS OF 2004 (BY TOTAL SALES PRICE)
Rank Building Region Price (Millions) Price/sq.ft. Buyer
1 Grand Canal Shoppes Las Vegas $766 $17.21/sq. ft. General Growth Properties
2 Providence Place Providence, R.I. $510 $510/sq. ft. Rouse Co.
3 729 N. Michigan Ave. Chicago $250 $11.52/sq. ft. JP Morgan Invest. Management
Source: Real Capital Analytics


TOP THREE LEASING DEALS OF 2004 (BY SIZE OF LEASE)
Rank Building Region Lease/sq.ft. Tenant Tenant Rep
1 Bank of America Tower NYC 1.1 million Bank of America Corp. Jones Lang LaSalle
2 300 Madison Ave. NYC 789,243 PricewaterhouseCoopers CLW Real Estate/CBRE
3 Waterview DC 625,062 Corp Executive Board Cushman & Wakefield
Source: CoStar Group


TOP 25 BROKERAGES

The Top 25 Brokerages listing is based on responses to NREI's Top Brokerage survey, which was conducted via e-mail in February and March 2005. Brokers were asked to provide the total dollar value of leasing transactions and investment sales during 2004. The totals were combined to determine the company's ranking. While NREI made every attempt to ensure the final survey was comprehensive, some companies chose not to participate.

  1. CB Richard Ellis Inc.

    865 South Figueroa St., 34th Floor
    Los Angeles, CA 90017
    Phone: (213) 438-4880
    E-mail: jen.hall@cbre.com
    Web site: www.cbre.com
    Ray Wirta, CEO; Brett White, President
    Total Amount of Investment Sales & Leasing Transactions: $127.4 billion

  2. Cushman & Wakefield Inc.

    51 West 52nd St.
    New York, NY 10019
    Phone: (212) 841-7500
    Web site: www.cushwake.com
    Bruce Mosler, President/CEO; John Cushman, Chairman of the Board; Tony Marano, COO
    Total Amount of Investment Sales & Leasing Transactions: $52.3 billion

  3. Colliers International

    50 Milk St.
    Boston, MA 02109
    Phone: (617) 722-0221
    E-mail: kgalvin@colliers.com
    Web site: www.colliers.com
    Margaret Wigglesworth, President/CEO; David Kahnweiler, Chairman; Richard Kimball, EVP
    Total Amount of Investment Sales & Leasing Transactions: $36.9 billion

  4. Grubb & Ellis Co.

    2215 Sanders Rd., Suite 400
    Northbrook, IL 60062
    Phone: (847) 753-7500
    E-mail: janice.mcdill@grubb-ellis.com
    Web site: www.grubb-ellis.com
    Maureen Ehrenberg, President, Global Client Services; Robert Osbrink, President, Transaction Services; Mark E. Rose, CEO
    Total Amount of Investment Sales & Leasing Transactions: $37.7 billion

  5. NAI Global

    4 Independence Way, Suite 400
    Princeton, NJ 08540
    Phone: (609) 945-4000
    E-mail: pfaulkner@naiglobal.com
    Web site: www.naiglobal.com
    Gerald Finn, Chairman/CEO; Jeffrey Finn, President/COO; David Blanchard, EVP
    Total Amount of Investment Sales & Leasing Transactions: $30.5 billion

  6. Jones Lang LaSalle

    200 East Randolph Dr.
    Chicago, IL 60601
    Phone: (312) 782-5800
    Web site: www.joneslanglasalle.com
    Colin Dyer, President/CEO; Lauralee Martin, COO/CFO; Peter Roberts, CEO, Americas
    Total Amount of Investment Sales & Leasing Transactions: $24.92 billion

  7. The CORE Network

    15150 Preston Rd., Suite 300
    Dallas, TX 75248
    Phone: (972) 980-3992
    E-mail: info@corenetwork.org
    Web site: www.corenetwork.org
    Edward A. Cross II, Chairman of the Board, CORE Network; Pat Hall, Vice Chairman of the Board, CORE Network
    Total Amount of Investment Sales & Leasing Transactions: $21.45 billion

  8. The Staubach Co.

    15601 Dallas Pkwy., Suite 400
    Addison, TX 75001
    Phone: (972) 361-5000
    Web site: www.staubach.com
    Roger Staubach, Chairman/CEO; Elysia Ragusa, President/COO; Ka Cotter, Vice Chairman
    Total Amount of Investment Sales & Leasing Transactions: $17.7 billion

  9. GVA Worldwide

    1569 Sherman Ave., Suite 201C
    Evanston, IL 60201
    Phone: (847) 733-0883
    E-mail: info@gvaworldwide.com
    Web site: www.gvaworldwide.com
    Michael T. Cohen, Chairman; Michael Corbett, Vice Chairman; Betsy Baer, COO
    Total Amount of Investment Sales & Leasing Transactions: $17.1 billion

  10. Marcus & Millichap

    16830 Ventura Blvd., Suite 352
    Encino, CA 91436
    Phone: (818) 907-0600
    E-mail: lgray@marcusmillichap.com
    Web site: www.marcusmillichap.com
    George M. Marcus, Chairman; William A. Millichap, Chairman; Harvey E. Green, President/CEO
    Total Amount of Investment Sales & Leasing Transactions: $14.4 billion

  11. Trammell Crow Co.

    2001 Ross Ave., Suite 3400
    Dallas, TX 75201
    Phone: (214) 863-3000
    E-mail: bbower@trammellcrow.com
    Web site: www.trammellcrow.com
    Robert E. Sulentic, Chairman/CEO; Michael J. Lafitte, President, Global Services Group; Robert K. Shibuya, Executive Director, National Brokerage
    Total Amount of Investment Sales & Leasing Transactions: $12.4 billion

  12. TCN Worldwide

    2419 Coit Rd., Suite A
    Plano, TX 75075
    Phone: (972) 769-8701
    Web site: www.tcnworldwide.com
    H. Ross Ford III, President/CEO; Neil H. Siderow, Chairman; David C. Wagner, Vice-Chairman
    Total Amount of Investment Sales & Leasing Transactions: $11.6 billion

  13. Coldwell Banker Commercial

    1 Campus Dr.
    Parsippany, NJ 07054
    Phone: (800) 222-2162
    Web site: www.coldwellbankercommercial.com
    George E. Slusser, President/COO; Jacklene Chesler, SVP; Fred Schmidt, SVP, Business Development
    Total Amount of Investment Sales & Leasing Transactions: $9.9 billion

  14. Newmark

    125 Park Ave.
    New York, NY 10017
    Phone: (212) 372-2000
    Web site: www.newmarkre.com
    Jeffrey Gural, Chairman; Barry Gosin, Vice Chairman/CEO; James D. Kuhn, President
    Total Amount of Investment Sales & Leasing Transactions: $9.5 billion

  15. Sperry Van Ness

    18881 Von Karman, Suite 800
    Irvine, CA 92612
    Phone: (949) 250-4100
    E-mail: david.frosh@svn.com
    Web site: www.svn.com
    Mark Van Ness, Co-Founder; Rand Sperry, Co-Founder; David Frosh, President
    Total Amount of Investment Sales & Leasing Transactions: $6.3 billion

  16. Lee & Associates Commercial Real Estate

    3991 MacArthur Blvd., Suite 100
    Newport Beach, CA 92660
    Phone: (909) 241-7904
    E-mail: blee@lee-associates.com
    Web site: www.lee-associates.com
    Steve Jehorek, President; Ed Indvik, President; Chuck Noble, President
    Total Amount of Investment Sales & Leasing Transactions: $5.7 billion

  17. Transwestern Commercial Services

    1900 West Loop South, Suite 1300
    Houston, TX 77027
    Phone: (713) 270-7700
    E-mail: mark_doran@transwestern.net
    Web site: www.transwestern.net
    Robert Duncan, Chairman; Larry P. Heard, CEO; Mark Doran, COO
    Total Amount of Investment Sales & Leasing Transactions: $5.7 billion

  18. Holliday Fenoglio Fowler LP

    2000 Post Oak Blvd., Suite 2000
    Houston, TX 77056
    Phone: (713) 852-3500
    Web site: www.hfflp.com
    John Pelusi Jr., Executive Managing Director/Managing Member; Mark D. Gibson, Executive Managing Director; John P. Fowler, Executive Managing Director
    Total Amount of Investment Sales & Leasing Transactions: $5.5 billion

  19. CRESA Partners

    200 State St., 13th Floor
    Boston, MA 02109
    Phone: (617) 758-6000
    E-mail: info@cresapartners.com
    Web site: www.cresapartners.com
    J. Michael Dow, President; Bill Goade, Founding Chairman; Gerald A. Porter, Vice Chairman
    Total Amount of Investment Sales & Leasing Transactions: $5.3 billion

  20. CORFAC International — Corporate Facility Advisors

    2000 N. 15th St.
    Arlington, VA 22201
    Phone: (703) 528-3500
    E-mail: info@corfac.com Web site: www.corfac.com
    Todd Payne, SIOR, Vice President; David Bruce, SIOR, Vice President; Thomas P. Bennett, Executive Director
    Total Amount of Investment Sales & Leasing Transactions: $4.4 billion

  21. Apartment Realty Advisors (ARA)

    717 17th St., Suite 2000
    Denver, CO 80202
    Phone: (303) 260-4336
    E-mail: info@ARAusa.com
    Web site: www.ARAusa.com
    Jeff Hawks, Chairman/Past President; David Oelfke, President; Derrick Bloom, President Elect
    Total Amount of Investment Sales & Leasing Transactions: $4.3 billion

  22. Century 21 Real Estate Corp.

    1 Campus Dr.
    Parsippany, NJ 07054
    Phone: (973) 496-7433
    Web site: www.century21.com/commercial
    Van Davis, President/CEO; Jacob Stepan, COO; John Greenleaf, SVP, Marketing
    Total Amount of Investment Sales & Leasing Transactions: $3.3 billion

  23. Advantis Real Estate Services Co.

    3455 Peachtree Rd., Suite 400
    Atlanta, GA 30326
    Phone: (404) 262-2828
    E-mail: sswartz@joe.com
    Web site: www.advantisgva.com
    Petch Gibbons, President/CEO; John Hutcheson, COO/CFO; Bruce Ford, VP, Management Services
    Total Amount of Investment Sales & Leasing Transactions: $2.4 billion

  24. Burnham Real Estate

    4435 Eastgate Mall, Suite 200
    San Diego, CA 92121
    Phone: (858) 452-6500
    E-mail: burnham@burnhamrealestate.com
    Web site: www.burnhamrealestate.com
    Stath Karras, President/CEO; Malin Burnham, Chairman; Jim Munson, Managing Director, Transaction Services
    Total Amount of Investment Sales & Leasing Transactions: $1.6 billion

  25. Molinaro Koger

    1676 International Dr., Suite 575
    McLean, VA 22102
    Phone: (703) 760-9600
    E-mail: slemon@mkhotels.com
    Web site: www.mkhotels.com
    Robert T. Koger, President; Jonathan Propp, COO; Rick Harris, Chief Information Officer
    Total Amount of Investment Sales & Leasing Transactions: $1.3 billion