Gosin, Futterman Call RKF Deal Transformative, Despite Reported Troubles

NEW YORK CITY—Newmark Group officials say the firm’s recent acquisition of retail brokerage RKF will help the company reshape the retail industry and take advantage of opportunities that now exist in the turbulent retail market.

In an interview with Globest.com, Newmark Group CEO Barry M. Gosin and Robert Futterman, former founder of RKF and now chairman of Newmark RKF, acknowledged that some brokers left the firm, but both bristled at reports that key brokers had quit over commission and recruitment issues. Gosin stresses to Globest.com that all the RKF brokers the company had hoped would stay on, did in fact join the now merged Newmark RKF.

Gosin praised Futterman for building RKF from scratch into a major retail services firm. He added that due to Futterman’s positive reputation and the loyalty his brokers had shown over the years, Newmark was able to land partners and brokers “who to be honest I was trying to get for years who would never talk to me,” Gosin relates.

He says the deal with RKF “is a great fit culturally. It is a great fit strategically. It makes us a dispositive winner in the retail market in New York and just builds on the foundation of all the retail we have around the country.”

Futterman says that Newmark has significant operations in major markets as well as in specific market segments, such as shopping center sales and property management for example, He adds that prior to the merger, Newmark already had an excellent reputation in the New York City marketplace.

He says that RKF could not have found a better partner in Gosin and Newmark to accomplish its mission of growing the business “to become the dominant retail company not only in the US, but around the world.”

Prior to the closing of the deal, several real estate trade publications reported on some push back from some RKF brokers and staff over signing multi-year contracts with Newmark as well as issues over commissions.

The Wall Street Journal in a report today estimated approximately 20 brokers departed RKF over the last few months and added that those departures have reduced RKF operations in some major cities including Chicago and New York.

In response to those critical trade reports published prior to the closing last week, Gosin and Futterman noted that the transaction closed ahead of schedule. While not revealing the specific number of employees that opted not to join the merged firm, Futterman says that the combined Newmark RKF has an employee count of between 250 to 300. Prior to the merger, RKF had a workforce of approximately 135.

In terms of merging their respective operations, Gosin says, “We have had a couple of people leave where there is some duplication and that is just a few people. There is very little overlap.”

Concerning its operations in New York, existing Newmark and former RKF brokers are excited about the opportunities at Newmark RKF and are already working together on deals. “I see a tremendous amount of synergy,” Gosin says, adding that he doesn’t believe “there are many eggs to break.”

Gosin reports that over time in markets where there are both Newmark and former RKF operations, the goal is to eventually consolidate operations into one location. He adds that office consolidations would likely occur first in the smaller markets and will come later in larger markets, such as New York City.

The retail sector is going through changing times and Gosin believes the merger affords Newmark RKF new opportunities. “With all the noise about retail, we think retail is in a very dynamic mode… We think it is a great opportunity to double down on retail and that is why we did the deal,” he says.

Futterman adds, “While retailers are taking this time to recreate their brands and the way they do business, I think what we are in for is a much more creative and dynamic time in the retail space. At the same time what is happening is there has been an enormous rent depression in the retail world.”

He says that is presenting an opportunity for retailers to expand and take advantage of the current retail real estate climate. “It’s really a perfect storm when you think about all the exciting things happening in retail and innovation going forward and how the rents have come down to a point where a lot of retailers can start expanding and taking space again.”