Berkadia, Berkshire Hathaway’s joint venture with Jefferies Financial Group, has formed an alliance with global property consultancy Knight Frank that will offer the firms’ clients unmatched access to domestic and internationally-based capital while maximizing their property values.
“This newly-formed relationship between our two privately-held firms will have innumerable benefits for clients on both sides,” said Berkadia CEO Justin Wheeler. “Berkadia’s depth of industry knowledge and experience will flow seamlessly with Knight Frank’s vast global network and valuation expertise to shift our transaction life cycle into high gear.”
The alliance will offer clients connectivity to and relationships with the world’s most active investors, enabling true relationships with diverse capital sources.
“Together, we have created an alliance focused on our clients’ needs, providing strategic advice and delivering a range of best-in-class capital markets solutions,” said William Beardmore-Gray, Senior Partner & Group Chairman at Knight Frank. “But more than that, we have a shared view of the world, that independent long-term relationships offer a superior experience to all our clients. This is the beginning of a lasting partnership, one which will cultivate both our firms’ collective expertise and suite of services we can offer our global client base.”
Knight Frank and Berkadia offer a combined global network comprising more than 22,750 people across 558 offices in 57 territories, spanning all key capital hubs. Together, they will be one of the world’s leading multifamily brokers.
Knight Frank is an estate agency, residential and commercial property consultancy founded in London by John Knight, Howard Frank and William Rutley in 1896. Together with its American affiliate, Cresa, Knight Frank is one of the world’s largest global property consultancies.
Founded in 2009 as a 50/50 joint venture between Berkshire Hathaway and Leucadia National Corporation (now known as Jefferies Financial Group), Berkadia is a third-party commercial mortgage servicer, as well as an approved lender for Fannie Mae, Freddie Mac, and HUD/FHA.
The company is among the top Freddie Mac and Fannie Mae multifamily lenders.
Berkadia owes its origins to GMAC Commercial Mortgage Corporation, which was acquired in 2009 by Kohlberg Kravis Roberts & Co., Five Mile Capital Partners LLC, and Goldman Sachs Capital Partners. Christened Capmark Financial, the company had $10 billion of originations in 2008 and a servicing portfolio of more than $360 billion before running into bankruptcy in October 2009.
In a deal approved by the bankruptcy court, Capmark sold its mortgage loan and servicing to the newly formed Berkadia in a deal worth $515 million.
The deal brought Berkshire into the heart of the commercial loan serving business, and the company has one of the largest commercial real estate servicing portfolios.
© 2023 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.