Big Brokerage Firm
Looks to Asia Market

From the Far Eastern Economic Review

WHEN ARTHUR J. MIRANTE II became chief executive of real-estate giant Cushman & Wakefield in 1984, the company was firmly focused on its home market and had no plans to expand outside the United States. Fast-forward 20 years: Mirante is sitting in Mumbai for a regional board meeting to rally his Indian staff and discuss ways to pump up international sales to 50% of his company's revenue in the next three years. Today, privately held Cushman & Wakefield has annual revenues of over $800 million and offices in 49 countries.

In many ways, Cushman & Wakefield's journey mirrors those of its multinational clients. As those companies sought more opportunities in the global market place, the demand for real-estate help in new locations followed.

For two years in the early 1990s, the company's board had "a very serious debate over whether to focus on the U.S." or go global, says Mirante, now 60. The eventual decision to expand overseas was as much a defensive strategy as an offensive one, he says. If clients set up offices outside the U.S. in countries where Cushman didn't have a presence, they'd have to rely on the firm's rivals. "Then they'd have a relationship with a competitor -- and what a risk that would be," he says.

Mirante started the global journey by setting up an alliance with Healey & Baker, a real-estate firm in Britain. But there were frictions due to differences in how the real-estate field operates in each country. "They thought we were uneducated, undisciplined cowboys," says Mirante. "And we thought they had no sense of urgency."

From there, Cushman, which offers a variety of brokerage, advisory and project-management services, formed partnerships in Mexico and South America. Its Asian adventure began in Hong Kong in 1994 with a joint venture that initially included Cushman & Wakefield, Healey & Baker, Grosvenor Estates and some individual investors. But, somewhat unusually for a multinational, its next stop -- and first success story -- was India. "India has helped us, frankly, fund and expand elsewhere in Asia," says Mirante.

In the mid-1990s, Cushman explored a deal to buy the Asia business of Colliers Jardine, including its Indian operations. The deal fell through, but Mirante's firm came back in 1997 and bought just the Indian arm, then headed by an Australian who today runs Cushman's Asian operations. "We focused on the talent here. When we saw it was available, we reached for it," says Mirante.

When Mirante first came to India five years ago, however, he was taken aback by the chaos that prevailed in New Delhi, from the anarchic traffic to the ramshackle street stalls. "I thought, 'this market has a long way to go'," he remembers with a laugh. "I always felt, 'Gee, what great potential, but I wonder if the country will ever take off'."

Now, Mirante says, India is quite possibly the most active real-estate market in the world in terms of demand from tenants for space. In Bangalore, for example, companies leased 405,000 square metres of space last year, and Cushman expects a similar amount of fresh leases there this year. There's very little vacant office space in the city, he says, and if a company needs a large facility there, it'll have to build it. Mirante's company earlier acted as project manager for the John F. Welch Technology Centre, a hi-tech campus in Bangalore that is General Electric's first research-and-development operation outside the U.S.

Cushman's network of offices now includes China, Japan, Australia, Thailand and Singapore. So far it's avoided Malaysia and the Philippines. Meanwhile, various problems plagued its foray into the Middle East and it closed its offices there. Mirante, who's on the road about 50% of the time, says he has absolutely no regrets about taking the company global. "It drained a lot of resources and takes a lot of work," he says. But, "we're happy to be here."

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