There’s been a whole lot of strategy at AY, starting with nine
months of work that culminated in 2008 with a template for
what Rose calls “a differentiated company.” The foundation of
that new company: “First and foremost, it needed to be principal-led and, more importantly, it needed to be collaborative. We
looked for alignment between our principal owners, our soon-to-be new shareholders, our young guns and junior staff—all
to be aligned and accountable to the ultimate stakeholder,
which is the client.”
In contrast to the multinational public companies that offer
what Earl Webb, president of US operations, calls “a supermar-
ket approach to the business,” AY goes for “a more strategic
focus. We take the deep dive and work with the clients to really
solve a problem, and because we’re a partnership, we hold our
partners accountable for the results.”
Those results are based on playing to the company’s
strengths rather than seeking to be all things to all people. “We
don’t try to do everything” for clients, Webb says. “We will do
what we do really well. We will help them organize and devise
a strategy and implement that strategy, but if we’re not the
best-in-class service provider in a certain market for a certain
property, we have no qualms about bringing on a competitor
who is best-in-class to help execute that assignment.” It’s a dif-
ferentiated approach, he adds, to which clients have begun
warming.
Now headquartered in Toronto, AY got its start in 1978 as
Graeme Young & Associates, based in Edmonton, Alberta,
which in 1996 merged with Toronto-based Avison & Associates.
Its entry into the US was spearheaded by Rose, who had
revamped Grubb & Elllis as its CEO a couple of years earlier,
and who then took time off to map out the type of company
he’d like to build.
He saw Canada, which remained strong as other markets
began to wane in early 2008, as “the absolute best and most
proper place to headquarter this truly global organization,”
and AY—a Grubb affiliate—as the ideal launching pad for a
growth strategy. The US debut in 2009 was preceded by the
September 2008 merger of AY’s three regions into Avison
Young (Canada) Inc., which Rose agreed to lead as chief
executive officer.
To lead the expansion into the US, Rose tapped Webb, a
one-time Jones Lang LaSalle colleague with whom he’d
worked on the 1999 merger of what was then Jones Lang
Wooton and LaSalle Partners. Coming aboard at AY shortly
after the Chicago office opened, Webb says the US entry followed “a relatively straightforward plan” in three phases.
In phase one, “we identified eight core strategic markets
where we knew we were going to put all of the services,” says
Webb. In addition to Chicago, those markets included Boston,
New York City, Atlanta, Houston, San Francisco, Los Angeles
and Washington, DC. The first phase was completed in April
2012, with the opening of offices in San Francisco and New
York City and the hiring of industry veterans Nick Slonek and
Arthur J. Mirante II, respectively, to run them.
Phase two entailed populating the core markets around
what AY refers to as “the two-by-five-by-four service matrix:”
two client types, five service lines and four asset classes. “And
then phase three involves going to those next-level peer mar-
kets where you need a physical presence at a high level,” while
not necessarily offering the entire service matrix from those
offices, Webb says. In a market such as Philadelphia, where the
company opened an office last month, “maybe we don’t need a
multifamily group; we can provide that from one of the other
markets. There’s probably 20 of those next-level markets that
we’ve been putting people in now for the past several years. So
far we’ve found great receptivity out there—not only for tal-
ented professionals to join us, but also for clients that see the
value proposition of the company and enjoy doing business
with us.”
Timing is everything, the saying goes, and Webb concurs
that AY made its US debut at a time when potential clients wel-
comed a fresh approach. “In the prior business cycle, the capi-
tal flow was enormous and the
transaction volume was enor-
mous,” he says. “The whole wave
was so strong that you could
take a volume-based approach
to client service, because if
something slipped or if a deal
didn’t get done properly, it
didn’t matter as much because
there was another buyer,
another lender, another tenant
and, in fact in many cases, the
deal would improve if some-
thing fell apart.”
Fast forward to the current
cycle, and “we’re finding that
everything is more difficult,”
says Webb. “The capital flow is
not as free. Lenders are more
careful. Buyers are much more
careful. Tenants are trying to
gain more flexibility because
their business may be up and
“It’s the structure that
keeps it together. And
it’s the structure that
determines that we
don’t just say what
we’re going to do, but
we’re actually going to
execute on it.”
MARK ROSE
Chairman of the Board and Chief
Executive Officer