Newmark Group, Inc.

Welcome to Newmark's second quarter 2021 financial results conference call. At this time, all participants will be in a listen-only mode. After the speaker presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to turn the conference over to Jason McGruder, Interim Head of Investor Relations. Thank you, and please go ahead.

Thank you. Good morning. Newmark issued its second quarter 2021 financial results press release in a presentation summarizing these results this morning. The results provided on today's call compare only the second quarter of 2021 with the year earlier period unless otherwise stated. Any figures with respect to cash flow from operations discussed on today's call refer to net cash provided by operating activities excluding loan originations and sales. We will be referring to our results on this call only on a non-GAAP basis. These non-GAAP terms include adjusted earnings and adjusted EBITDA, as well as those terms excluding the impact of NASDAQ and the 2021 equity event. Please see today's press release for more information on the impact of NASDAQ and the 2021 equity event, as well as for results under generally accepted accounting principles or GAAP. Please also see the section of today's press release for the complete and updated definitions of any non-GAAP terms, reconciliation of these items to the corresponding GAAP results, and how, when, and why management uses them. Additional information with respect to our GAAP and non-GAAP results mentioned on today's call are available on our website and in supplemental Excel tables and quarterly financial results presentations. Any outlook discussed on today's call assumes no material acquisitions, share repurchases, or meaningful changes in the company's stock price. These expectations are subject to change based on various macroeconomic, social, political, and other factors, including the COVID-19 pandemic. I'll also remind you that information on this call regarding our business that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended. Such statements involve risks and uncertainties. These include statements about the effects of COVID-19 pandemic on the company's business results, financial position, liquidity, and outlook, which may constitute forward-looking statements and are subject to the risk that the actual impact may differ, possibly materially, from what is currently expected. Except as required by law, Newmark undertakes no obligation to update any forward-looking statements. for discussion of additional risks and uncertainties which could cause actual results to differ from those continuing forward-looking statements in Newmark Securities and Exchange Commission filings, including but not limited to the risk factors set forth in our most recent Form 10-Q, 10-K, or Form 8-K filings. I'm now happy to turn the call over to our host, Barry Gossin, Chief Executive Officer of Newmark Group, Inc.

Thank you, Jason. Good morning, and thank you for joining us for Newmark's second quarter 2021 conference call. Joining me on the call today are Newmark's Chief Financial Officer, Mike Raspoli, our Chief Strategy Officer, Jeff Day, and our Chief Revenue Officer, Lou Alvarado. Following a record first quarter, Newmark's revenues increased by 64% to $630 million, our best-ever top line for a second quarter. As the economy continues to recover and vaccination rates rise, our clients are making plans to return to the workplace. Companies have increased utilization of existing lease space and are making new long-term commitments across all sectors. We benefited from a rapidly recovering economy and Newmark's continued market share gains. Revenues reflected greatly increased demand across all major property types. Our growth was led by a nearly 250% increase in revenues from capital markets, driven by the incredible talent and platform we have assembled. Newmark's volume across investment sales, mortgage brokerage, and multifamily originations together increased by 225%, outperforming the industry. By comparison, overall U.S. investment sales and debt volumes increased by approximately 47%. Newmark had record debt volume of over $11 billion, which was an increase of nearly 200%, led by multifamily. We leveraged our diverse relationships with non-agency lenders to help clients navigate lower GSE loan activity. While GSE volumes were down in the first half of the year, 57% of their 2021 caps remained. As a result, we expect increased GSE lending activity in the second half of the year. Our leasing and other commissions were up by 54%, which included growth from both tenants and landlords and improved activity level across office, industrial, and retail. We also saw improved activity across alternative and specialty property types like land, mixed use, and life science. Newmark's total revenues from management services, servicing fees, and other sources increased by 55%. We continue to benefit from our focus on growing these recurring revenue businesses. In addition to our robust operating results, Newmark received approximately $928 million in NASDAQ stock, We expect this accelerated windfall to allow us to buy back shares, reduce our debt, invest in growth, and maintain our strong liquidity. As Michael will explain in more detail, we have already used a portion of the proceeds to significantly reduce our fully diluted share count. We have enormous white space to grow our business. We aim to expand our presence in business lines and geographies where we have already invested in our infrastructure and there is an opportunity to accelerate its growth and increase our market share. With our strong foundation, we expect to outperform the market over time as industry volumes continue their recovery. With that, I'm happy to turn the call over to Mike.