...Ashforth Pacific, the West Coast operating subsidiary of The Ashforth Company, a commercial real estate firm headquartered in Stamford, Conn., has just been purchased by Scott Langley, the subsidiary's CEO and president for the past 10 years, the firm announced Wednesday. The resulting new investment management company is named Langley Investment Properties and will continue to be headquartered in Portland, Ore...
...Besides this transaction, CPE has recently reported on a surge of motion in the industry, including the merger of four CRE firms in Idaho and Montana, Lee & Associates' opening an office in NYC and an Avison Young office in Las Vegas.
Stan Ross, chairman of the board of the Lusk Center for Real Estate at the University of Southern California, spoke briefly with CPE about this kind of activity, albeit without intending to comment on any specific transaction.
"There's a lot of activity" of this type, he agreed. "You could call it a trend."
As to what's driving this, Ross offered plenty of possibilities. For one, a CRE company might be in trouble and looking for a suitor, or a publicly traded company's value might have fallen, making it an attractive target.
On a more positive note, he said, a merger or spinoff might take place "just because the value proposition is there." For example, it might be beneficial to combine two company's product lines, or their differing geographic areas of operation might provide some advantages.
And of course, there are those common situations in which a merger can increase the depth of management, provide cost efficiencies or create a critical mass in some other way.
Finally, Ross noted, liquidity is a factor in the CRE industry: "There's been a lot of capital sitting around."
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