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Insignia Reports Sharp Gains, Benefits from $19.1 Mil Life Insurance Policy

NEW YORK CITY-Yesterday (Wednesday, Nov. 1), Insignia confirmed the predictions of analysts. Net income dramatically increased as a result of the proceeds from a life insurance policy on Edward S. Gordon.

By Amy Vaughn | Updated on November 02, 2000

NEW YORK CITY-Last week, Banc of America Securities’ William C. Marks and Michael G. Chang predicted “very strong third quarter results,” for Insignia in large part because of the proceeds on Edward S. Gordon’s “key-man” life insurance policy. Not only did the policy benefit the company’s net income, but the third quarter financial results, reported yesterday (Wednesday, Nov.1), show significant gains in several areas.

Insignia Financial Group Inc. reported Net EBITDA climbed 28% to $25.2 million. Its per share rate rose 18%. The convertible preferred stock issued this past February is being given the credit for this particular rise. Service revenues rose 14% to $219.9 million, attributable to growth of the commercial real estate operation.

Thanks to its real estate operations, Insignia’s income in this area rose 55%. “The strength of our commercial property services platform in the United States and United Kingdom, coupled with our growing presence in continental Europe, offset softer results from our US residential businesses. Realty One’s businesses have been adversely affected primarily by higher mortgage rates,” says Andrew L. Farkas, the current chairman and chief executive officer, in a statement accompanying the report. “While Douglas Elliman’s business, exceptionally strong through the first half of 2000, has returned to a normal pace.”

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