Kantor, Brennan, Reiff Exiting Top Posts
The changing of the guard continues at the big real estate shops on Wall Street.
Steven Kantor and Robert Brennan, longtime senior real estate executives at Credit Suisse and, before that, Donaldson Lufkin & Jenrette, are transferring to another area of Credit Suisse as the bank begins a retreat from the origination and new-issue underwriting segments of the commercial MBS business.
Meanwhile, managing director Randy Reiff resigned yesterday as head of J.P. Morgan's CMBS group. Reiff, who previously was the top CMBS executive at Bear Stearns, won a power struggle to lead the group last year following J.P. Morgan's buyout of Bear. The word is he's being replaced by managing director Brian Baker, who had co-headed J.P. Morgan's CMBS group before the merger.
The moves are the latest in a seemingly endless chain of personnel changes stemming from the CMBS-market train wreck. The ranks of the top executives have been largely wiped out by fallout from the debacle.
Credit Suisse's chief executive, Brady Dougan, said this week that his company planned to leave the CMBS sector, in which it has been a major player. "The CMBS business, something where we have been a big player . . . is a business we are effectively moving out of," Dougan said, according to a Reuters story. He did not specify a timetable for the withdrawal.
Elaborating on Dougan's comments, a spokesman confirmed that the bank would no longer pursue CMBS originations and underwriting assignments, but would continue to support the trading of Credit Suisse deals in the secondary market. He added that the bank would complete advisory assignments and would pursue investments in debt, including distressed debt, via the fund side of the business.
Kantor for the past year has focused on reducing Credit Suisse's overhang of CMBS and leveraged finance positions. The bank's commercial real estate exposure stood at $11.4 billion at Sept. 30, down from $22.9 billion at yearend 2007. The bank took $2.6 billion of net commercial real estate writedowns through the third quarter of last year. Its fourth-quarter earnings are scheduled to be released next week.
Kantor and Brennan have been two of the longest-serving commercial real estate executives on Wall Street. Kantor is giving up the title of co-head of global securities, which included oversight responsibility for real estate finance. He will now work full-time on his other role, as co-head of the illiquid-alternatives unit in the alternative-investments division. "His focus will be on raising third-party capital, making use of his industry understanding and strong client relationships," an internal memo said. Nicole Arnaboldi is the other co-head of the illiquid-alternatives group.
Brennan, head of the global CMBS group, will soon join Kantor in the illiquid-alternatives group, according to people familiar with the matter. Kantor and Brennan have worked together for years, dating back to their time at DLJ. Kantor joined DLJ in 1995 after stints at Paine Webber and Drexel Burnham Lambert. Brennan started working at DLJ several years earlier.
Kantor was head of the investment banking, finance and origination groups in DLJ's real estate division. Brennan co-headed the conduit operation. Both moved over to Credit Suisse in 2000 when the company acquired DLJ.
Kantor, Arnaboldi, Brennan and Taylor are all managing directors.
Separately, Edmund Taylor, who previously had a chief administrative role in Credit Suisse's global securities group, has moved back into the CMBS group, where he previously worked. That move was part of a restructuring of the global securities division. Taylor's new role is managerial, although his precise duties couldn't be learned.
Reiff's resignation from J.P. Morgan came as a surprise, since he took over the group only last April. Reiff declined to comment, but colleagues said he decided to leave because it became clear that the bank's lending platform wouldn't be as broad as he had hoped when he joined the firm. They added that he plans to pursue opportunities on the buy side. Reiff is expected to remain at the bank for several weeks to help with the transition.
Baker evidently will take over the CMBS group. He is a bank veteran who has had stints as co-head of the CMBS group and head of the CMBS trading desk. A J.P. Morgan spokesman declined to comment.