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From Covered Wagon to Flying Dragon

Eastdil Secured Is Buying Back Control of the Company From Wells Fargo With Help of Singapore-Based Temasek

Yesterday the details were released about Wells Fargo’s long-awaited sale of their real estate investment arm Eastdil. The financial giant bought the firm, which is credited with bringing a more sophisticated marketing process to major property sales, in 1990 but is now in the process of selling off its non-core assets. The sale of the company seems to have little to do with the financial health of its operations, it has been ranked third in the pantheon of New York City investment firms, brokering about $249 billion worth of deals last year.

So who are the buyers? The most notable partner in the bid for the company is called Temasek. They are often referred to as Singapore-based, but they are much more tied to the island nation than just the location of their headquarters. When Singapore became a sovereign nation, after a contemptuous ejection from their union with Malasia, the small island nation became owners of assets like the airline, communications network and shipping companies. To help the government manage these assets Temasek was incorporated to hold and manage the assets previously held directly by the Singapore government. The goal was for Temasek to own and manage these investments on a commercial basis, allowing the Ministry of Finance and the Ministry of Trade and Industry to focus on policymaking.

Temasek differs from many sovereign wealth funds because it invests mostly in equities, is the outright owner of many assets, and pays taxes like other commercial investment firms. It is also has a rather impressive technology investment portfolio including investments in companies like Door Dash, Impossible Meats and WeWork China.

With this upcoming transition for Eastdil Secured, we will be able to witness what it looks like for a large commercial real estate advisory to change hands, from one of the most conservative organizations to one of the most forward thinking. Temasek has likely learned from SoftBank, another long-term investor brandishing state wealth, on the value of connecting their technology investments with other holdings in their portfolio. If so, then we will need to look no further than Temasek’s deal sheet to see which innovations might be used to modernize Eastdil real estate under management.

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