It’s the Yankees vs. the Red Sox! CBRE Bests Cushman & Wakefield in ’07 Leasing

On a recent night at the MetLife building, Dean Shapiro, a director for leasing for CB Richard Ellis, checked his email. What he found floored him.

“When I opened it, it was like ‘Holy Shit!’” said Mr. Shapiro. “I kept seeing our name and I kept scrolling down the list and I saw it some more.”

The e-mail was a draft of a list of CoStar’s top 50 biggest leasing deals in Manhattan in the first half of 2007. What he saw on the list, over and over again, were the letters: CBRE.

There was a certain degree of awe among commercial brokers last week when they opened Crain’s and saw how swiftly CBRE walloped the rest of the field.

Total up the top leasing deals and you’ll see why: CBRE brokered 4.3 million square feet in Manhattan so far this year; its archrival, Cushman & Wakefield, brokered 1.5 million square feet.

“I would say that this is probably as good a performance as we’ve ever turned in,” said Mr. Shapiro. “I’ve never really gone back to look at the top 50 deals, but I have to say when we looked at the compilation we were really astounded at the amount of deals we were involved in.”

Even his competitors had to admit as much.

“They are the No. 1 firm in New York,” said Steve Berliner, the midtown office branch director at Studley, which came in second on the top 50 with 1.7 million feet leased.

The gap between CBRE and every other commercial firm is now so profound that it’s a wonder if anyone will ever catch up. Mr. Shapiro doesn’t seem to think so.

“There was a time when Cushman & Wakefield was going for the top spot, but they’re resigned to the fact that they can’t get that,” he said. “They’re not close. You can make a highly concerted effort to strive for the No. 1 spot, or you can just do your business and resign yourself to where you are, which can be extremely profitable.”

At the halfway point last year, CBRE brokered 2.2 million square feet to Cushman & Wakefield’s 1.5 million square feet—a difference of only one or two large deals. This year, Cushman officials are left looking for explanations.

“I don’t know if there’s any meaning to put in it,” Suzy Reingold, a manager for Manhattan leasing at Cushman, said of the list. “It’s not a trend. It’s been good this year, and we probably had more deals in terms of volume in the lesser sizes.”

Not all is lost against its rival, she argued.

“Branding-wise and naming-wise we’re way out in front of them,” said Ms. Reingold.

Meanwhile, for brokers at Studley, the year has been a great one, even if it’s not on a CBRE level. It eclipsed Cushman in square feet brokered, including the second- and third-biggest deals of 2007 so far: Cravath’s renewal at Worldwide Plaza and Lehman Brothers settling into Time Inc.’s old space on Sixth Avenue.

“For us, this has been a wonderful first half,” said Mr. Berliner of Studley. “Last year was a record year and we should beat that by 30 to 50 percent.”

Studley, which has about a fifth of the brokers CBRE has, is an object lesson that there are many ways to make a tidy profit.

But it’s fair to say that most firms are probably looking forward to turning the calendar to the fall.

“When you work with big deals, it’s not always efficient,” said Barry Gosin of Newmark Knight Frank, which had two deals on the list. “Some years you’re big, some years you’re not. Sometimes you can’t predict exactly when big deals are going to close. We have a lot of big deals in the second half of the year.”

Some brokers explain the CBRE dominance as simple mathematics—they have more manpower, therefore they get more deals. (CBRE has 245 New York brokers compared to Cushman’s 180, Newmark’s 164 and Studley’s 52, according to The Real Deal magazine.)

But don’t bring that up to Mr. Shapiro of CBRE.

“What does that mean?” he asked. “It takes a lot of skill to run a company of this size. A No. 1 position isn’t forever. People are gunning for you all the time. Part of our creed is to constantly resist complacency.”

The ultimate test to bear that out: how they perform from here on out.


—additional reporting by Tom Denison It’s the Yankees vs. the Red Sox! CBRE Bests Cushman & Wakefield in ’07 Leasing