SCHEDULE 13D/A: Newmark Group Undergoes Significant Ownership Shift as Howard Lutnick Divests for Cabinet Role

Howard W. Lutnick is divesting his substantial interests in Newmark Group, Inc. to comply with U.S. government ethics rules following his appointment as U.S. Secretary of Commerce, transferring control to trusts managed by Brandon G. Lutnick.

Summary

• Howard W. Lutnick agreed to sell 10,969,523 shares of Class A Common Stock to Newmark Group, Inc. at a price of $11.58 per share, which was the closing price on May 16, 2025.
• The sale to the company includes shares held directly by Mr. Lutnick, his personal asset trust, the Howard W. Lutnick Family Trust, his spouse, and retirement accounts.
• The company's purchase is authorized under its existing stock repurchase program, which was reapproved by the Board and Audit Committee in November 2024, with the specific transaction approved by the Audit Committee.
• Mr. Lutnick is also selling all voting shares of CF Group Management, Inc. (CFGM), the managing general partner of Cantor Fitzgerald, L.P. (CFLP), to trusts controlled by Brandon G. Lutnick.
• CFGM, through its and CFLP's holdings, controls approximately 58.5% of the total voting power of Newmark's outstanding common stock as of May 16, 2025.
• Following these transactions, Brandon G. Lutnick will assume voting and dispositive power over the common stock held by CFGM and CFLP, while Howard W. Lutnick will no longer hold such power.
• Additionally, Howard W. Lutnick is selling interests in Tangible Benefits, LLC and KBCR Management Partners, LLC, both of which hold Newmark shares, to trusts controlled by Brandon G. Lutnick.
• The total Class A Common Stock outstanding as of May 16, 2025, is 152,734,090 shares.
• As of May 16, 2025, beneficial ownership percentages are: Howard W. Lutnick 22.4%, CFGM 21.0%, CFLP 20.5%, and Brandon Lutnick 2.2%.

Sentiment

Score: 6

Explanation: The sentiment is neutral to slightly positive. The transactions are a planned divestment for ethics compliance, not indicative of underlying company performance issues. The orderly transfer of control and the company's repurchase of shares at market price are generally viewed as neutral to slightly positive events, demonstrating good governance and potentially reducing share count.

Positives

• The divestment ensures compliance with U.S. government ethics rules for Howard W. Lutnick's new role, demonstrating adherence to regulatory standards.
• The orderly transfer of significant voting control to Brandon G. Lutnick suggests a planned succession and continuity in governance.
• Newmark Group's repurchase of shares from Mr. Lutnick utilizes its existing stock repurchase authorization, potentially benefiting remaining shareholders by reducing the outstanding share count.

Negatives

• A significant reduction in direct beneficial ownership by a key founding figure like Howard W. Lutnick could be perceived as a loss of direct oversight, despite the transfer of control to a family member.

Risks

• The closing of the sale of CFGM voting shares to trusts controlled by Brandon G. Lutnick is subject to the satisfaction of customary closing conditions, including receipt of required regulatory approvals, which could introduce uncertainty or delay.

Future Outlook

Other than the described divestment and transfer of interests to comply with U.S. government ethics rules, the Reporting Persons have no current plans or proposals related to transactions or other matters specified in Item 4 of Schedule 13D. However, they reserve the right to review or reconsider their positions and develop future plans or proposals at any time.

Management Comments

• "The transactions described herein follow Howard W. Lutnick's agreement to divest his interests in the Company to comply with U.S. government ethics rules in connection with his appointment as the U.S. Secretary of Commerce."

Industry Context

This filing primarily details a significant internal ownership and control transition within Newmark Group, Inc., driven by the personal appointment of Howard W. Lutnick to a U.S. government cabinet position. It does not reflect broader industry trends in the commercial real estate services sector but rather a specific corporate governance event related to a key executive's public service.

Management Changes

Corporate Governance

Related Party Transactions

• Sale of 10,969,523 shares of Class A Common Stock by Howard W. Lutnick (including shares held directly, in personal asset trust, family trust, by spouse, and retirement accounts) to Newmark Group, Inc.
• Sale of all voting shares of CF Group Management, Inc. by Howard W. Lutnick (as trustee) to trusts controlled by Brandon G. Lutnick.
• Sale of certain interests, including those in Tangible Benefits, LLC and KBCR Management Partners, LLC, by Howard W. Lutnick (as trustee) to trusts controlled by Brandon G. Lutnick.

Stakeholder Impact

• Shareholders: The company's repurchase of shares from Howard W. Lutnick will reduce the outstanding share count, potentially impacting earnings per share and valuation. The shift in controlling interest from Howard W. Lutnick to Brandon G. Lutnick represents a significant change in corporate control.
• Employees/Partners: Cantor Fitzgerald, L.P. has a loan program for certain employees and partners, which is secured by pledged Class B Common Stock of Newmark Group, Inc., indicating a financial arrangement tied to the company's stock.

Next Steps

• Closing of the sale of 10,839,674 shares by Howard W. Lutnick to Newmark Group, Inc. on May 19, 2025.
• Closing of the sale of 129,849 shares from retirement accounts to Newmark Group, Inc. immediately after the closing of CFGM voting shares.
• Closing of the sale of CFGM voting shares and other interests (Tangible Benefits, KBCR) to trusts controlled by Brandon G. Lutnick, subject to customary closing conditions, including required regulatory approvals.

Key Dates

Keywords

Newmark Group Inc., NWM, SEC filing, Schedule 13D/A, beneficial ownership, Howard W. Lutnick, Brandon G. Lutnick, Cantor Fitzgerald, CF Group Management, stock repurchase, divestment, U.S. Secretary of Commerce, corporate governance