Commercial real estate firms are broadening their offerings and service lines, in part through a recent hot streak of mergers and acquisitions activity.

The flurry of deals announced or closed in 2021 was a contrast to the real estate M&A lull in 2020, the early days of the Covid-19 pandemic. At the midpoint of 2021, 16 M&A transactions in real estate were announced — a 45% increase from a year prior and on track to be a record year, according to New York-based real estate advisory firm Hodes Weill & Associates.

Much of the deal activity lately is driven by a desire for commercial real estate firms to capitalize on booming property sectors — life sciences, for example — or to diversify offerings beyond core services, such as brokerage.

For example, Avison Young on Friday closed on an acquisition of Studio Eagle, a workplace design firm based in Springfield, New Jersey. That’s on the heels of the commercial real estate firm, most known for its brokerage services, in December acquiring Dowling Houy LLC, a Boston-headquartered project-management firm that specializes in life sciences.

Orlando, Florida-based brokerage commercial real estate firm Foundry Commercial is beefing up via acquisitions, too, with the recent purchase of Charlotte, North Carolina-based location analysis and incentives-advisory firm Maxis Advisors LLC. The deal adds several new service lines for Foundry, including incentives negotiation and compliance, site selection and location analysis, and labor analytics.

Paul Ellis, CEO of Foundry Commercial, said several Foundry employees in Charlotte had worked with Maxis over the years, which spurred conversations about an acquisition last summer. The deal closed Dec. 23.

Patric Zimmer, president of Maxis Advisors, said the way companies use site selection, location and labor-analytics data today — since the pandemic — has changed.

By far, labor has become the No. 1 qualifier for just about every project Maxis works on, he said.

“That’s definitely had an impact on location decision for clients,” he continued.


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