LOS ANGELES-"Over the near term, there will be other major consolidations of advisors triggered by advisors looking to expand their product offerings both in type and geographically." So says Brian T. Murdy, the national director of Institutional Property Advisors, a division of Marcus & Millichap. Murdy is also a former employee of Henderson Global. Murdy recently talked with GlobeSt.com about the recent consolidations among real estate entities, particularly the merger of TIAA-CREF and Henderson Global.

GlobeSt.com: Give us an overview of the merger landscape.

Brian Murdy: Since the economic collapse, speculation has constantly been that consolidation of real estate entities is inevitable. A few consolidations occurred, including Cornerstone Real Estate Advisers' acquisition of European-based Protego in 2009.

Now, within a period of six months, there have been several major transactions. The first was the joint acquisition completed earlier this year of the Archstone portfolio by AvalonBay and Equity Residential, two public companies acquiring the assets of a private REIT. In late May, private REIT American Realty Capital agreed to acquire CapLease, a public REIT. This was shortly followed by Mid America's announcement that it intends to acquire Colonial.

The common denominator for these announcements is that all the entities are REITs. The announcement that TIAA-CREF and Henderson Global are combining forces globally, while TIAA is acquiring Henderson's North American operations, is the first major consolidation in the advisory world post-downturn. The combination of these two firms is logical, given that TIAA is strongest in North America and Henderson is strongest in Europe and Asia.

I believe that over the near term, there will be other major consolidations of advisors triggered by advisors looking to expand their product offerings both in type and geographically. Another factor that will contribute is that many of the large plan sponsors are looking to reduce the number of advisors, which may encourage some advisors to consider consolidating.

GlobeSt.com: How quickly will these other consolidations arrive? This year/next?

Murdy: While a consolidation may be a surprise to the market when it is announced, typically discussions had been ongoing for many months. Over the next 18 months, there will be more, but predicting how many is a difficult guess.

GlobeSt.com: Are these marriages driven by outside considerations, or is it truly a strategic decision based on operational needs?

Murdy: As the economy is strengthening, you can assume that the next wave of consolidation will be strategic, resulting in an improved platform, as is the case with the TIAA-CREF/Henderson combination.

GlobeSt.com: How soon do you anticipate large plan sponsors will be making reductions?

Murdy: Large plan sponsors have been making these reductions over the last several years, with most of the reductions coming from attrition as closed-end funds arrive at their scheduled end. Some plan sponsors have eliminated their separate accounts, taking that money and investing in core open-end funds to obtain greater diversification. Also, as plan sponsors invest in funds, the trend is to go with existing advisors.

GlobeSt.com: Is consolidation a good thing? Or are there unintended consequences that may result from fewer entities available?

Murdy: Consolidation is a normal part of an investment cycle. A typical result is that new start-up entities are formed, usually with a boutique investment strategy, supplying a need that would be more difficult for larger firms to fulfill.

Prior to joining IPA, Murdy served as a portfolio manager of Hartford, Conn.-based Cornerstone Real Estate Advisers' flagship core open-end fund. A 28-year veteran of the institutional multifamily investment industry, Murdy was formerly portfolio manager for Cornerstone Real Estate Advisers. Murdy established strong relationships with state, county and city pension funds, off-shore investors, insurance companies as well as foundations and endowments resulting in raising and deploying over $2.5-billion of capital. He also was responsible for managing and capital raising for the firm's $1.7-billion open-ended fund for the past eight years.

Prior to joining Cornerstone, Murdy was a director and portfolio manager for Henderson Global Investors, where he managed three apartment funds, two public and two private syndications, as well as Phoenix Home Life's $1-billion real estate equity portfolio and a $2-billion mortgage loan portfolio. He also has experience as an accountant with DiSanto Bertoline and KPMG.

As previously reported by GlobeSt.com, Marcus & Millichap Research Services' Hessam Nadji indicates that recent job growth increases the probability that the Federal Reserve will end economic stimulus efforts later this year.