Aon Acquires The Townsend Group

By Keith Loria

Aon plc has acquired The Townsend Group, a real estate advisory and management services for pension funds firm, from Colony NorthStar Inc., for $475 million. The deal was previously agreed to in September.

“We are excited to welcome the Townsend organization into Aon and further enhance our investment solutions in areas that are of increasing importance to our clients,” Cary Grace, Aon’s CEO of global retirement & investment solutions, said in a prepared release. “Working together, our combined teams will continue to expand our capabilities and expertise in alternative investments to create sophisticated and transparent offerings that provide our clients with objective advice and solutions.”

The deal allows Aon the chance to gain additional AUM focused on the real estate asset class as it looks to build out its offerings to institutions in the U.S., UK and Asia.

Townsend manages $14.5 billion in assets, with a client roster of some of the world’s top global investors in North America, Asia, Europe and the Middle East. With the addition of Townsend, Aon’s investment organization now manages more than $130 billion of worldwide assets.

“The closing of the Townsend sale is a great outcome for Colony NorthStar and its shareholders as well as for the acquirer, Aon, and Townsend employees,” Richard B. Saltzman, Colony NorthStar’s president & CEO, said. “Townsend’s market leading business is situated now in a synergistic home while we continue our path towards simplification and reinvesting proceeds from non-core liquidity events into our strategic priorities.” 

Moving Ahead

The Townsend Group’s co-founder Kevin Lynch passed away unexpectedly in February, and the company is now run by CEO and co-founder, Terry Ahern. He will continue to lead real estate and real asset investment services as part of the agreement.

“We were happy to have a large number of quality firms that wanted to partner with us, but it was the commonality of culture, approach and expertise that led us to Aon,” Ahern said. “We look forward to having additional opportunities to continue our evolution that we began 30 years ago, while leveraging the platform, capabilities and people that, together, Aon and Townsend can offer to clients.”

This summer, Colony NorthStar acquired a 2.8-million-square-foot, 20-property industrial portfolio located in the Mid-Atlantic along the Interstate 95 corridor from TA Realty LLC, for $201 million.

Morgan Stanley & Co. served as the financial advisor to Colony NorthStar in the Townsend deal.