Photo: Eileen Escarda
Commercial Real Estate Roundup
Brokerage revival in Florida real estate
Commercial real estate brokerages are on the prowl as the market heats up.
A year ago, commercial real estate firm Avison Young secured a beachhead in Florida when 30 brokers and property managers left longtime Florida player Flagler Real Estate Services to join the growing Toronto-based leasing, property management and investment sales firm.
In short order, the Fort Lauderdale-based Florida region added Dan Carlo, a veteran of commercial real estate firm HFF, who joined in May as managing director in Miami. The next month, Avison Young acquired WG Compass Realty in West Palm Beach, 24 more brokers and employees and an entry into the retail market. Then in September, it bought Tampa’s Lane Witherspoon & Carswell Commercial Real Estate Advisors and its sibling property management company and 19 people. Avison Young is up to five offices, 83 people and 20 million square feet of property listings or property under management in Florida.
Florida managing director Pike Rowley, a 59-year-old native Floridian who was with Flagler, says it’s just a start. The firm plans to be in all the major Florida markets. “We’re just excited about being able to take a very entrepreneurial platform and push it around the state,” Rowley says. “There’s an elite number of national companies at the top of the food chain and then there’s everybody else. What we’re doing is cracking into that elite group.”
The recovery of commercial real estate in Florida has seen a revival in firm-building. Franklin Street, a Tampa-based commercial real estate services firm, started in 2006 and now is up to 200 employees in four main offices in Tampa, Miami, Jacksonville and Atlanta. It’s expanding into Nashville, Kentucky and Dallas. Its model, in addition to the standard leasing, sales and management services, also offers financing and insurance. “It’s been pretty powerful,” says CEO Andrew Wright. “We’ve fortunately had a lot of success.”
Avison Young’s model is to offer real estate firm owners and veteran professionals shareholder status to join. Lower-level Avison Young employees also can buy shares. Using that model, Avison has grown from 300 people and 11 offices companywide four years ago to 1,300 and 53 offices today.
“It’s a pretty simple concept,” Rowley says. “You’re a middle-aged broker and you’ve had a very successful career and you wake up and you’re realizing you’re collecting ordinary income and giving away a good chunk to your house and at the end of the career what do you have to show for it? Where’s the wealth creation?”
Avison is growing just as the comeback in residential real estate helps build demand for commercial. Investors are on the prowl for industrial real estate in Miami, Rowley says. “Anything that comes on the market is snatched up in a heartbeat. That market is on fire,” he says.
What the impact of the new fast-growing firms will be on the market remains to be seen. As a senior executive at one national brokerage firm said, in essence it’s the same people, different business cards. Avison recently took its first assignment in the Orlando market and wants an office there and in Jacksonville too, but building Miami is “foremost.” It accounts for a third of the entire state market.