Strutt & Parker senior partner Andy Martin is to become UK chief executive of BNP Paribas Real Estate following its takeover of Strutt & Parker.
He takes over the role from John Slade. Slade is likely to continue with the company but is understood not to have confirmed a role yet.
The takeover was confirmed to staff across the two businesses this morning. Rumours of a merger first surfaced at MIPIM more than two years ago.
BNP PRE has agreed a deal to buy both Strutt & Parker’s commercial and residential and agricultural business. Strutts’ residential, agricultural, development and planning teams business will retain the “Strutt & Parker” brand, while the commercial arm will operate as BNP PRE.
The acquisition, which is due to complete in September, will see BNP PRE more than double its UK business and significantly increase its residential footprint.
Martin said: “I am very keen on the idea of uniting our brand with the strength of BNP Paribas Real Estate. It gives us a distinguishing feature and a new impetus in a constantly-evolving global market. I have been impressed by the respect that they have shown for our values, and by their emphasis on the relationship with employees and clients across all our business sectors.
“This merger not only creates attractive commercial real estate opportunities, but also opens up new prospects in the rural and residential sectors thanks to the size and strength of the group that we are creating together.”
In an internal e-mail to staff, BNP PRE global chief executive Thierry Laroue-Pont, said that the deal would create “tremendous prospects and opportunities that would be beneficial to our European customers and businesses. London remains a strategic gateway to Europe for our clients and is a complimentary market for our other core European cities”.
He said: “This combination will enable us to offer our clients, all over the world, a broadened and deeper expertise as well as new, even more innovative services and solutions. In this new stage of development, we shall carefully take into consideration the expectations of both groups’ employees and clients.”
While historically Strutts has reported about 40% of its turnover from residential deals, the sector only accounts for about 15% of BNP PRE’s UK business.
A combined agent, with £206m of revenue, would be among the top five agents in the UK, just above GVA. Although Strutts does not break down its regional data between commercial and residential turnover, assuming 40% of its revenue came from residential business, about 28% of the combined firm would be residential.
Martin had been preparing to retire as senior partner of Strutts this year as partnership rules dictate that partners must do so in their 60th year.
Slade has been UK chief executive at BNP PRE since 2012. During his tenure he has supervised a planned expansion and repositioning of the UK arm of BNP PRE.
Prior to BNP PRE, Slade was the chief executive of Accrue Capital. He was previously joint chairman of capital markets and managing director of international investment at DTZ and executive head of CBRE’s City business.
Strutts, which made £18.2m of pretax profit on £108m of revenue in the year to April 2016, appointed Evercore in January last year to review the future of the business, which has over the past year been subject to interest from parties including CBRE and Bidwells. Operating profit fell by 33.4% for the year to 30 April 2016 to £18.9m, and revenue eased off marginally by 3.2% to £107.7m. The firm’s 53 equity partners received a total of £16.2m from the company last year.
The business has 60 offices across the UK and more than 1,000 staff.