Ottawa’s largest independent commercial real estate brokerage has been sold to a U.S.-based industry giant.
Primecorp Commercial Realty CEO Aik Aliferis told OBJ Wednesday afternoon the organization has been acquired by California-based Marcus & Millichap in a deal that closed earlier in the day. Terms of the agreement were not disclosed.
Founded in 1998, Primecorp has offices in Ottawa, Toronto, Montreal and Gatineau and employs a dozen brokers in the National Capital Region, making it the city’s sixth-largest commercial brokerage. The firm has done more than $7 billion worth of deals with clients ranging from locally owned stores to major chains such as McDonald’s, Rexall pharmacies and Starbucks.
Aliferis, one of four original partners who launched the company 20 years ago, compared the transaction with another high-profile recent deal involving organizations in Ottawa and California.
"They’re picking up the Karlsson of the real estate world in Canada."
“They’re picking up the Karlsson of the real estate world in Canada,” he said, referring to the trade between the Ottawa Senators and San Jose Sharks last month that sent all-star blueliner Erik Karlsson to the west coast.
Under the deal, Primecorp’s Bank Street headquarters will remain open but will take the Marcus & Millichap name, while staff in Toronto and Montreal will move to the U.S. parent’s offices in those cities. Aliferis and his current partners, Sam Firestone and Nick Pantieras, will come on board as senior executives, and the firm’s other brokers and staff will also be retained.
Aliferis said former Primecorp employees will continue to offer the same brokerage and advisory services under the M&M banner, while Primecorp's property management arm will continue to be a separate entity. Primecorp employs about two dozen people in the National Capital Region, Toronto and Montreal.
“There are not going to be any fundamental changes in the Primecorp philosophy,” he said. “It’ll only elevate our game even more.”
Joining a behemoth brokerage
Aliferis said the sale will open the door to bigger deals with larger institutional clients that already do business with M&M, which was founded in 1971, went public in 2013 and is now one of the world’s largest brokerages. Last year, the 1,800-employee firm closed nearly 9,000 transactions worth more than $42 billion.
M&M has been looking to beef up its presence in Canada’s institutional market in a bid to go toe to toe with the likes of industry behemoths CBRE, JLL and TD. In late August, it acquired Montreal-based brokerage McGill Commercial with the aim of carving a bigger niche in the Quebec market.
Aliferis said M&M approached Primecorp earlier this year about a potential acquisition. Primecorp’s founders will now take on key leadership roles as M&M looks to grow its Institutional Property Advisors brand in Canada.
Launched several years ago, the IPA brand has made M&M an emerging player in brokering major deals in the apartment, office and industrial sectors in the U.S., and the firm is aiming to continue that momentum north of the border.
“We feel (the deal) is going to give us a lot of horsepower in (the institutional) direction because of the global reach of (M&M) and the infrastructure that Marcus has on an international level,” Aliferis said.
“We’ve been very successful at getting the institutional business, but this is only going to help us get even more. This is catapulting us into the next phase.”
All Greek to me
Aliferis said Primecorp’s executives hit it off with M&M brass during the initial meetings and soon sensed the two companies were a good match.
“We’ve been approached by multiple companies in the past, but we didn’t like the style and the culture of those firms as much,” he said. “We felt that (Marcus & Millichap) were a perfect fit for us.”
The two firms also have common elements in their back story. M&M was launched in 1971 by Greek-born billionaire George M. Marcus, while two of Primecorp’s founding partners – Aliferis and Pantieras – are also of Greek heritage.
“We felt an instant connection to their company because of that fact,” Aliferis said. “Once we drilled down a little deeper into how the organization runs, we were extremely impressed with their executive. All of those elements added together really inspired us to become part of their brand.”