More Broker Movement Between Companies

Most brokers say the moves began in earnest in early 1998 after Trammell Crow Co. decided to add brokerage to its core business of developing real estate for institutional investors – at the expense of the existing local brokerages. With bigger splits and guaranteed leasing work for national clients, Trammell Crow lured two brokers from Norris Beggs & Simpson, three brokers from Cushman & Wakefield and Grubb & Ellis' entire five-man retail team.

Ever since, the ripple effect has been playing out, as brokerage houses take from other brokerage houses to fill voids. For example, Grubb & Ellis, after losing its retail team, beefed up its industrial team with Tom Talbot from CB Richard Ellis and others, but also lost brokers Mark Fraser, Scott Fraser and more recently Jeff Brooks, who all ended up over at Colliers International.

Of all the brokerages that lost personnel over the past 36 months, Cushman & Wakefield has experienced the most high-profile losses, and mostly from new developers coming into town. The company seems to be weathering it well, however, having beat out several other local competitors already this year for two major leasing assignments.

After losing top office and industrial brokers to Trammell Crow in 1998, Cushman in early 1999 lost another top producer in Mike Wells, who left to head up Sacramento, CA-based Panattoni Development's foray into the Portland area. Already this year, Cushman has lost perennial top producer and managing director prospect Scott Langley to locally based developer Ashforth Pacific, which made him president. Langley then brought over as marketing director Doug Pugh, another longtime Cushman & Wakefield office broker.

"Initially, you always hate to see good, tenured people go, but as of late we've kind of become a training ground for our clients," Terry Shanley, managing director of Cushman & Wakefield of Oregon, told GlobeSt earlier this year. "The good news is they are still our clients" and that Cushman & Wakefield continues to nab new leasing assignments. Earlier this month, C&W beat out other local firms to win the preleasing assignment for Schnitzer Northwest's planned downtown Portland office building and a goodly portion of the 4.2-million-sf local industrial portfolio Rreef is buying from Spieker Properties.

One longtime broker and manager in town says 10 years ago it was unusual to get more than two people changing places in a year, but now you see it all the time. "It used to be very difficult to move because only large companies could afford the technology to produce marketing materials or track the market," says the broker. "You can now do all of those things with a $1,500 desktop computer, and because of that the large firms, especially the publicly traded ones, have struggled."

They are struggling because they have too many rookies, say others. "The guys that left Grubb went to Crow for substantially better splits, which Crow was able to provide that because it doesn't have a bunch of rookies on its books," says one. "If you lose people and replace them with junior people, then the expense of covering the junior people makes it hard to give bigger splits to senior people."

The moves also have been sparked by the heretofore-vibrant economy, say brokers. "When the market is hot, an individual broker considers himself more valuable, and there is a lot of courting that goes on," says another. "Competing brokerages with less overhead call up and offer you better splits and more assistance because they don't have to send as much back to corporate to maintain the growth publicly-traded companies need to maintain to continue increasing shareholder value."