Grubb Grabs Enfrastructure, CB Veterans in Latest Move
By DANIEL D. WILLIAMS
Grubb & Ellis Co., which is struggling to get on its feet nationally and looking to build on strength in Orange County, has made more high-profile hires.
Last week the brokerage landed three OC veterans of rival CB Richard Ells Services Inc., one by way of Aliso Viejo-based Enfrastructure Inc.
Scott Johnstone, Bob Davis and Greg Puccinelli join several other recent hires by Grubb locally. They include Cushman & Wakefield Inc.’s Mike Dorsey and Colliers Seeley International Inc.’s Tim Joyce.
Johnstone, Davis and Puccinelli made up an office brokerage partnership in the late 1990s working out of CB Richard Ellis’ Newport Beach office.
Johnstone was a CB broker for 15 years, nabbing the title of No. 1 office broker in OC for seven straight years before leaving in 2000 to help start Enfrastructure, where he was senior vice president of sales and marketing.
His work at Enfrastructure,an office campus where everything from computers to coffee are provided for tenants,was done, Johnstone said.
“We’re up to 93% occupied in all five of our campuses, which allowed us to be on autopilot from a marketing standpoint,” he said.
Johnstone said he went with Grubb because of its “national platform and entrepreneurial spirit.”
“I received offers from six firms,” he said.
Grubb has been luring brokers in OC despite woes nationally.
The Northbrook, Ill.-based brokerage was delisted by the New York Stock Exchange last month after failing to meet the Big Board’s market capitalization and equity rules.
At about a buck last week, Grubb’s shares are worth about a fourth of what they were a year ago.
Earlier in the year, Grubb fended off two takeover bids, the first by New York-based Insignia Financial Group Inc.’s Insignia/ESG Inc. and then by CB.
The CB offer got as far as the negotiation stages before Grubb called off talks in May saying “the potential merger partner did not share our vision regarding the industry in general, and our integrated business model in particular.”
Then in June, Grubb closed its San Diego office after years of decline there. At one point, the San Diego office counted 70 brokers, a number that dwindled to 20 at the time of its closing.
Johnstone said what appealed to him about Grubb is that the brokerage isn’t scaling back marketing in the real estate downturn.
“They give you the tools and services, whatever it takes, to market a property,” he said. “They’re showing it, by putting dollars where their mouth is.”
Johnstone and others declined to comment on whether Grubb is offering higher commissions than other brokerages.
Watch for Grubb to land a handful of national clients, Johnstone said.
“They are similar to those who are partners with Enfrastructure,” he said.
Johnstone’s stint at Enfrastructure gave him a new take on the brokerage business, he said.
“In developing the company we had to raise $100 million dollars,” Johnstone said. “I learned what it’s like to make a presentation asking for as much as $25 million.”
Before joining Grubb, Johnstone said he recruited his former CB team of Davis and Puccinelli.
Davis has 25 years with CB and joins Grubb as a senior vice president.
Puccinelli put in seven years with the brokerage and is a Grubb vice president.
Davis called the move “an extraordinarily difficult decision.”
But Davis said he liked what he saw at Grubb.
Since June, the brokerage has run a program aimed at revitalizing itself dubbed “project Iowa.” Grubb Chairman C. Michael Kojaian,who owns half of the brokerage,coined the term. This “new start” began about the time of the takeover bid by CB last June.
“At that time, Kojaian bought a majority share in the company, using his own money,” said Bob Osbrink, Grubb’s director of the Western region.
Kojaian upped his stake from 9% to 58%.
Grubb’s Western region stretches from Seattle to San Diego, said Osbrink, who operates from Newport Beach.
As for the recent turmoil that’s plagued Grubb, “Those things are behind us now, and we’re excited about the future,” Osbrink said.
