X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

NEW YORK CITY-Published reports, neither confirmed nor denied by spokespeople for either company, that Lehman Brothers is negotiating with CIBC Oppenheimer over the acquisition of CIBC retail operations and possibly investment banking have led to hypothetical debates over the deal’s impact on space in the city. This is one of several bank merger and acquisition deals that have people talking space availability.

Lehman Brothers reportedly does not have a significant retail presence and is seeking CIBC’s 600 brokers and their wealthy clients. Additional rumors indicate that Lehman is also eagerly seeking CIBC’s investment banking operations. These operations would be an overlap of Lehman’s with the noted exception in the area of high-yield, in which CIBC apparently excels.

“What becomes of the real estate property in deals like this depends on the duplication of facilities,” observes Peter Brooks, a principal for Ernst & Young. “In this case it doesn’t seem like there’s much overlap, which generally means they’ll maintain the retail and support office space.”

As to the possible overlap in investment banking operations, Brooks notes, “Without knowing all of the specifics, it doesn’t seem likely that this would result in a significant dumping of their property portfolio onto the market. This deal will very likely have no impact on the market here.”A similar deal, he observes, is Chase’s acquisition of J.P. Morgan operations. With little overlap, the chances of much property held by either company are slim to none. This is in contrast to the Chase and Chemical merger of yesteryear, which Brooks saw first hand as a Chemical employee. Hundreds of employees lost their jobs and retail space was vacated as their competing locations were consolidated. So too, this seems to be the case, if to a lesser extent, in the Donaldson, Lufkin & Jenrette buyout of Credit Suisse First Boston’s operations. Employees in Suisse’s high-yield debt and e-commerce divisions have lost their jobs and office space will probably become available in their New York and other American offices.

These deals all reflect the resurgence of the trend in bank mergers and acquisitions before the recession of the 1990s. Reports are published daily indicating that sources inside many significant New York-based companies are considering selling or looking to buy their competition. With such a tight market it’s no wonder discussions about these rumors quickly focus on what’s to become of the office and retail space.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper

 

GlobeSt. NET LEASE Fall 2021Event

This conference brings together the industry's most influential & knowledgeable real estate executives from the net lease sector.

Get More Information
 

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.