of activity here and that will continue to
be the case. Europe has been the fastest
area of growth for us over the last two
years as the capital system has stabilized
and market conditions continue to present
opportunities for us. We did the largest
transaction in our history this year in
Germany. With North America, Japan and
Europe already well-established, we have
the unique ability to help clients through
cross-border transactions across the most
mature economies of the world. In fact,
many of our ABL clients have engaged us
to perform cross-border appraisals where
having boots on the ground in North
America, Japan and Europe was essential
to being able to get the project done.
We believe our platform can be
leveraged in other markets throughout
the world as well. We already have a
worldwide expansion plan underway led
by Frank Morton, who is now CEO of our
international businesses. Prior to this
expanded role, Frank had been overseeing
our European practice and our Japanese
joint venture. One of his primary goals is
to introduce Gordon Brothers’ offerings to
markets in Central and South America and
Asia, where we don’t have a local presence.
This expansion is very exciting for us.
Naturally, there are unique challenges to
entering any new market. There are different countries, languages, cultures, rules of
law, regulatory environments, and levels of
sophistication of the insolvency practices, but we have also found many deal
attributes to be universal as well. We will
be looking at each one of these, and other,
components as we pursue international
growth for Gordon Brothers. Frank has
assembled an experienced, multilingual,
multicultural team to do just that.
It seems many companies and industries
refer to a “new normal” since the recession. How did the recession affect the
company specifically and the appraisal industry in general? And, if you could give us
a few predictions for the coming year for
the industry, we’d appreciate that also.
It’s a common misperception that when
macro-economic factors are bad, Gordon
Brothers does well, and when the economy
does well, Gordon Brothers does poorly.
In reality, we are helping companies cope
with secular change more than cyclical
change. Economic cycles exacerbate secular change and that is part of what we saw
during the Great Recession. In retail, as
well as in other industries, the rate of secular change has never been greater. During
the recession, capital was scarce and those
that couldn’t create a compelling case for
themselves couldn’t attract capital and
ceased to exist. We were there to help
facilitate the recycling of those assets. In
other cases, struggling, but ongoing businesses needed access to capital. We were
able to step in with junior secured loans,
extending the runway for management.
Today, the majority of our asset disposi-
public yet, but I think we will be in the posi-
tion to discuss them later this year. There
are a few developments that I think will
be very exciting for the clients and referral
partners that we work with.
Gordon Brothers Group has divisions in
Europe and Japan. Are there any plans for
expanding into other areas of the world?
Absolutely. Just to clarify though, we still
believe there is substantial growth for
us in the U.S., Canada, Europe and Japan,
where we are already established. In fact,
we’ve been very active in Canada recently,
where we’ve had a presence for a long
time. The U.S. is obviously the biggest
economy in the world and has the most
mature capital system, so there is plenty
We’re finding more and
more of our clients are looking for
guaranteed solutions, so we continue
to develop innovative, principal
transaction structures that help
our clients meet their objectives
and focus their attention on
ongoing business operations.
Ken Frieze and Michael Frieze pose with paintings of Phil Frieze and JB Gordon.