Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Oct. 28, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | HF | |
Entity Registrant Name | HFF, Inc. | |
Entity Central Index Key | 1,380,509 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Class A Shares Outstanding | 38,085,785 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 191,802 | $ 233,904 |
Accounts receivable | 4,916 | 4,003 |
Receivable from affiliate | 4 | |
Mortgage notes receivable | 826,851 | 318,951 |
Prepaid taxes | 2,810 | 1,007 |
Prepaid expenses and other current assets | 8,359 | 8,291 |
Total current assets, net | 1,034,738 | 566,160 |
Property and equipment, net | 15,517 | 13,592 |
Deferred tax asset, net | 115,017 | 129,877 |
Goodwill | 3,712 | 3,712 |
Intangible assets, net | 32,069 | 27,022 |
Other noncurrent assets | 5,479 | 2,167 |
Total Assets | 1,206,532 | 742,530 |
Current liabilities: | ||
Current portion of long-term debt | 574 | 500 |
Warehouse line of credit | 824,517 | 318,618 |
Accrued compensation and related taxes | 42,519 | 56,478 |
Accounts payable | 1,917 | 2,118 |
Payable under tax receivable agreement | 11,315 | 10,796 |
Other current liabilities | 8,479 | 18,780 |
Total current liabilities | 889,321 | 407,290 |
Deferred rent credit | 11,296 | 9,827 |
Payable under the tax receivable agreement, less current portion | 100,077 | 110,395 |
Long-term debt, less current portion | 216 | 514 |
Total liabilities | 1,000,910 | 528,026 |
Stockholders' equity: | ||
Treasury stock, 377,663 and 497,055 shares at cost, respectively | (11,642) | (11,378) |
Additional paid-in-capital | 129,211 | 117,216 |
Retained earnings | 87,668 | 108,283 |
Total equity | 205,622 | 214,504 |
Total liabilities and stockholders' equity | 1,206,532 | 742,530 |
Class A Common Stock [Member] | ||
Stockholders' equity: | ||
Class A common stock, par value $0.01 per share, 175,000,000 authorized; 38,463,448 and 38,351,367 shares issued, respectively; 38,085,785 and 37,854,312 shares outstanding, respectively | $ 385 | $ 383 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Treasury stock, shares | 377,663 | 497,055 |
Class A Common Stock [Member] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 38,463,448 | 38,351,367 |
Common stock, shares outstanding | 38,085,785 | 37,854,312 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenues | ||||
Capital markets services revenue | $ 122,349 | $ 109,841 | $ 349,887 | $ 322,119 |
Interest on mortgage notes receivable | 3,098 | 3,226 | 9,274 | 9,044 |
Other | 1,088 | 618 | 2,569 | 1,785 |
Total revenues | 126,535 | 113,685 | 361,730 | 332,948 |
Expenses | ||||
Cost of services | 71,348 | 63,549 | 206,336 | 189,270 |
Personnel | 11,733 | 10,722 | 39,715 | 35,753 |
Occupancy | 3,678 | 3,258 | 10,408 | 8,991 |
Travel and entertainment | 3,710 | 2,755 | 12,211 | 10,086 |
Supplies, research, and printing | 2,102 | 2,067 | 5,993 | 5,531 |
Insurance | 534 | 544 | 1,699 | 1,716 |
Professional fees | 1,204 | 1,323 | 3,906 | 4,096 |
Depreciation and amortization | 3,063 | 2,323 | 8,625 | 6,604 |
Interest on warehouse line of credit | 1,885 | 1,511 | 5,562 | 4,527 |
Other operating | 3,017 | 1,767 | 8,688 | 5,571 |
Total expenses | 102,274 | 89,819 | 303,143 | 272,145 |
Operating income | 24,261 | 23,866 | 58,587 | 60,803 |
Interest and other income, net | 9,053 | 7,989 | 24,109 | 23,006 |
Interest expense | (9) | (13) | (33) | (35) |
(Increase) decrease in payable under the tax receivable agreement | (1,025) | 1,052 | (1,025) | 2,143 |
Income before income taxes | 32,280 | 32,894 | 81,638 | 85,917 |
Income tax expense | 12,260 | 13,638 | 31,896 | 36,078 |
Net income | $ 20,020 | $ 19,256 | $ 49,742 | $ 49,839 |
Earnings per share-Basic and Diluted | ||||
Income available to HFF, Inc. common stockholders-Basic | $ 0.52 | $ 0.51 | $ 1.30 | $ 1.31 |
Income available to HFF, Inc. common stockholders-Diluted | $ 0.51 | $ 0.50 | $ 1.28 | $ 1.30 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock [Member]Class A Common Stock [Member] | Treasury Stock [Member] | Additional Paid in Capital [Member] | Retained Earnings [Member] |
Beginning balance at Dec. 31, 2014 | $ 186,445 | $ 381 | $ (9,042) | $ 101,148 | $ 93,958 |
Beginning balance, shares at Dec. 31, 2014 | 37,677,981 | 447,382 | |||
Stock compensation and other, net | 11,414 | 11,414 | |||
Incremental tax adjustment from share-based award activities | 314 | 314 | |||
Issuance of Class A common stock, net | 109 | $ 2 | 107 | ||
Issuance of Class A common stock, net, shares | 226,004 | ||||
Repurchase of Class A common stock | (2,376) | $ (2,376) | |||
Repurchase of Class A common stock, shares | (68,318) | 68,318 | |||
Dividends paid | (67,821) | 1,817 | (69,638) | ||
Net income | 49,839 | 49,839 | |||
Ending balance at Sep. 30, 2015 | 177,924 | $ 383 | $ (11,418) | 114,800 | 74,159 |
Ending balance, shares at Sep. 30, 2015 | 37,835,667 | 515,700 | |||
Beginning balance at Dec. 31, 2015 | 214,504 | $ 383 | $ (11,378) | 117,216 | 108,283 |
Beginning balance, shares at Dec. 31, 2015 | 37,854,312 | 497,055 | |||
Stock compensation and other, net | 13,303 | 13,303 | |||
Incremental tax adjustment from share-based award activities | (586) | (586) | |||
Issuance of Class A common stock, net | $ 2 | $ 2,715 | (2,717) | ||
Issuance of Class A common stock, net, shares | 343,554 | (231,473) | |||
Repurchase of Class A common stock | (2,979) | $ (2,979) | |||
Repurchase of Class A common stock, shares | (112,081) | 112,081 | |||
Dividends paid | (68,362) | 1,995 | (70,357) | ||
Net income | 49,742 | 49,742 | |||
Ending balance at Sep. 30, 2016 | $ 205,622 | $ 385 | $ (11,642) | $ 129,211 | $ 87,668 |
Ending balance, shares at Sep. 30, 2016 | 38,085,785 | 377,663 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Operating activities | ||
Net income | $ 49,742 | $ 49,839 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Stock based compensation | 8,941 | 6,394 |
Incremental tax adjustment from share-based award activities | 586 | (314) |
Deferred taxes | 14,074 | 12,294 |
Increase (decrease) in payable under the tax receivable agreement | 1,025 | (2,143) |
Depreciation and amortization: | ||
Property and equipment | 2,377 | 1,782 |
Intangibles | 6,248 | 4,822 |
Gain on sale or disposition of assets, net | (12,191) | (12,133) |
Mortgage service rights assumed | (3,334) | (3,152) |
Proceeds from sale of mortgage servicing rights | 2,265 | 3,891 |
Increase (decrease) in cash from changes in: | ||
Accounts receivable | (913) | (2,307) |
Receivable from affiliates | 4 | (2) |
Payable under the tax receivable agreement | (10,824) | (10,822) |
Mortgage notes receivable | (505,899) | 99,413 |
Net borrowings on warehouse line of credit | 505,899 | (99,413) |
Prepaid taxes, prepaid expenses and other current assets | (1,871) | (2,406) |
Other noncurrent assets | (3,312) | (1,376) |
Accrued compensation and related taxes | (9,597) | (1,225) |
Accounts payable | (201) | 297 |
Other accrued liabilities | (10,101) | (24,421) |
Other long-term liabilities | 1,336 | 1,211 |
Net cash provided by operating activities | 34,254 | 20,229 |
Investing activities | ||
Purchases of property and equipment | (4,014) | (3,631) |
Net cash used in investing activities | (4,014) | (3,631) |
Financing activities | ||
Payments on long-term debt | (415) | (314) |
Proceeds from stock options exercised | 109 | |
Incremental tax adjustment from share-based award activities | (586) | 314 |
Dividends paid | (68,362) | (67,821) |
Treasury stock | (2,979) | (2,376) |
Net cash used in financing activities | (72,342) | (70,088) |
Net decrease in cash | (42,102) | (53,490) |
Cash and cash equivalents, beginning of period | 233,904 | 232,053 |
Cash and cash equivalents, end of period | $ 191,802 | $ 178,563 |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | 1. Organization and Basis of Presentation Organization HFF, Inc., a Delaware corporation (the “Company”), through its Operating Partnerships, Holliday Fenoglio Fowler, L.P., a Texas limited partnership (“HFF LP”), and HFF Securities L.P., a Delaware limited partnership and registered broker-dealer (“HFF Securities” and together with HFF LP, the “Operating Partnerships”), is a commercial real estate financial intermediary providing commercial real estate and capital markets services including debt placement, investment sales, equity placements, investment banking and advisory services, loan sales and loan sale advisory services, commercial loan servicing, and capital markets advice and maintains 23 offices in the United States. Initial Public Offering and Reorganization The Company was formed in November 2006 in connection with a proposed initial public offering of its Class A common stock. On November 9, 2006, the Company filed a registration statement on Form S-1 with the United States Securities and Exchange Commission (the “SEC”) relating to a proposed underwritten initial public offering of 14,300,000 shares of Class A common stock of the Company (the “Offering”). On January 30, 2007, the SEC declared the registration statement on Form S-1 effective and the Company priced 14,300,000 shares for the initial public offering at a price of $18.00 per share. On January 31, 2007, the Company’s common stock began trading on the New York Stock Exchange under the symbol “HF.” In addition to cash received for its sale of all of the shares of Holliday GP and approximately 44.7% of partnership units of each of the Operating Partnerships (including partnership units in the Operating Partnerships held by Holliday GP), HFF Holdings also received, through the issuance of one share of the Company’s Class B common stock to HFF Holdings, an exchange right that permitted HFF Holdings to exchange interests in the Operating Partnerships for shares of (i) the Company’s Class A common stock (the “Exchange Right”) and (ii) rights under a tax receivable agreement between the Company and HFF Holdings. Since all of the partnership units had been exchanged as of August 31, 2012, the Class B common stock was transferred to the Company and retired on August 31, 2012 in accordance with the Company’s certificate of incorporation. See Note 12 for further discussion of the tax receivable agreement. As a result of the reorganization, the Company became a holding company through a series of transactions pursuant to a sale and purchase agreement. Pursuant to the Offering and reorganization, the Company’s sole assets are, through its wholly-owned subsidiary HoldCo LLC, partnership interests of HFF LP and HFF Securities and all of the shares of Holliday GP. Basis of Presentation The accompanying consolidated financial statements of the Company as of September 30, 2016 and December 31, 2015 and for the three and nine month periods ended September 30, 2016 and September 30, 2015, include the accounts of HFF LP, HFF Securities, and the Company’s wholly-owned subsidiaries, Holliday GP and HoldCo LLC. All significant intercompany accounts and transactions have been eliminated. Pending Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (“FASB”) issued changes to the accounting for equity compensation. This update simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. This update will be effective for the Company beginning in fiscal year 2017. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. In February 2016, the FASB issued new guidance on the accounting for leases. This new guidance will require that a lessee recognize assets and liabilities on the balance sheet for all leases with a lease term of more than twelve months, with the result being the recognition of a right of use asset and a lease liability. The new lease accounting requirements are effective for the Company’s 2019 fiscal year with a modified retrospective transition approach required, with early adoption permitted. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. In May 2014, the FASB issued changes to revenue recognition with customers. This update provides a five-step analysis of transactions to determine when and how revenue is recognized. An entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update will be effective for the Company beginning in fiscal year 2018. This update may be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying this update recognized at the date of initial application. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies These interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information, the instructions to Quarterly Report on Form 10-Q and Rule 10-01 of Regulation S-X and should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. Accordingly, significant accounting policies and disclosures normally provided have been omitted as such items are disclosed therein. In the opinion of management, all adjustments consisting of normal and recurring entries considered necessary for a fair presentation of the results for the interim periods presented have been included. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts in the financial statements and accompanying notes. These estimates are based on information available as of the date of the unaudited consolidated financial statements. Therefore, actual results could differ from those estimates. Furthermore, operating results for the three and nine months ended September 30, 2016 are not necessarily indicative of the results expected for the year ending December 31, 2016. The Company has a firm profit participation plan, office profit participation plans, and effective January 1, 2015, an executive bonus plan (the “Plans”) that each allow for incentive payments to be made, based on the achievement of various performance metrics, either in the form of cash or stock at the election of the Company’s board of directors. The expense associated with the Plans is included within personnel expenses in the consolidated statements of income. The expense recorded for these Plans is estimated during the year based on actual results at each interim reporting date and an estimate of future results for the remainder of the year. Based on an accounting policy election and consistent with ASC 718, Compensation—Stock Compensation Prior to January 1, 2015, the Company’s office and firm profit participation plans allowed for payment to be made in both cash and share-based awards, and the composition of such payment was determined in the first calendar quarter of the subsequent year. A portion of the cash and share-based awards issued under these office and firm profit participation plans are subject to time-based vesting conditions over the subsequent twelve months of the grant date, such that the total expense measured for these plans is recorded over the period from the beginning of the performance year through the vesting date, or 26 months. In addition, prior to January 1, 2015, awards made under the executive bonus plans were historically settled as a cash payment made in the first calendar quarter of the subsequent year, with the entire award recognized as expense in the performance year. Effective January 1, 2015, the Company amended the Plans, which now provide for an overall increase in the allocation of share-based awards. The cash portion of the awards will not be subject to time-based vesting conditions and will be expensed during the performance year. The share-based portion of the awards is subject to a three year time-based vesting schedule beginning on the first anniversary of the grant (which is made in the first calendar quarter of the subsequent year). As a result, the total expense for the share-based portion of the awards is recorded over the period from the beginning of the performance year through the vesting date, or 50 months. |
Stock Compensation
Stock Compensation | 9 Months Ended |
Sep. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Compensation | 3. Stock Compensation The stock compensation cost that has been charged against income for the three and nine months ended September 30, 2016 was $2.9 million and $8.9 million, respectively, which is recorded in personnel expenses in the consolidated statements of income. The stock compensation cost that has been charged against income for the three and nine months ended September 30, 2015 was $1.8 million and $6.4 million, respectively. At September 30, 2016, there was approximately $31.0 million of unrecognized compensation cost related to non-vested restricted stock units with a weighted average remaining contractual term of 2.8 years. As of September 30, 2016, there were 2,082,189 restricted stock units outstanding, of which 1,892,804 have continued vesting requirements. During the three month period ended September 30, 2016, no options were granted, vested, exercised or forfeited. During the three month period ended September 30, 2016, 16,756 new restricted stock units were granted, 4,393 restricted stock units vested and were converted to Class A common stock, and no restricted stock units were forfeited. The fair value of vested restricted stock units was $5.2 million at September 30, 2016. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 4. Property and Equipment Property and equipment consist of the following (dollars in thousands): September 30, 2016 December 31, 2015 Furniture and equipment $ 7,685 $ 7,055 Computer equipment 1,950 1,555 Capitalized software costs 1,375 882 Leasehold improvements 15,754 13,454 Subtotal 26,764 22,946 Less accumulated depreciation and amortization (11,247 ) (9,354 ) $ 15,517 $ 13,592 At September 30, 2016 and December 31, 2015, the Company has recorded, within furniture and equipment, office equipment under capital leases of $1.9 million and $1.7 million, respectively, including accumulated amortization of $1.2 million and $0.8 million, respectively, which is included within depreciation and amortization expense in the accompanying consolidated statements of income. See Note 7 for discussion of the related capital lease obligations. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 5. Intangible Assets The Company’s intangible assets are summarized as follows (dollars in thousands): September 30, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value Amortizable intangible assets: Mortgage servicing rights $ 58,484 $ (26,515 ) $ 31,969 $ 49,771 $ (22,849 ) $ 26,922 Unamortizable intangible assets: FINRA license 100 — 100 100 — 100 Total intangible assets $ 58,584 $ (26,515 ) $ 32,069 $ 49,871 $ (22,849 ) $ 27,022 As of September 30, 2016 and December 31, 2015, the Company serviced $55.2 billion and $48.7 billion, respectively, of commercial loans. The Company earned $5.8 million and $17.0 million in servicing fees and interest on float and escrow balances for the three and nine month periods ending September 30, 2016, respectively. The Company earned $5.3 million and $14.7 million in servicing fees and interest on float and escrow balances for the three and nine month periods ending September 30, 2015, respectively. These revenues are recorded as capital markets services revenues in the consolidated statements of income. The total commercial loan servicing portfolio includes loans for which there are no corresponding mortgage servicing rights recorded on the balance sheet, as these servicing rights were assumed prior to the Company’s adoption of ASC 860, Transfers and Servicing The Company stratifies its servicing portfolio based on the type of loan, including life company loans, commercial mortgage backed securities (“CMBS”), Freddie Mac and limited-service life company loans. Changes in the carrying value of mortgage servicing rights for the nine month periods ended September 30, 2016 and 2015, were as follows (dollars in thousands): Category 12/31/15 Capitalized Amortized Sold / 9/30/16 Freddie Mac $ 7,074 $ 8,460 $ (1,576 ) $ (2,450 ) $ 11,508 CMBS 16,768 778 (3,001 ) 1,948 16,493 Life company 2,729 2,154 (1,448 ) — 3,435 Life company – limited 351 404 (222 ) — 533 Total $ 26,922 $ 11,796 $ (6,247 ) $ (502 ) $ 31,969 Category 12/31/14 Capitalized Amortized Sold / 9/30/15 Freddie Mac $ 5,199 $ 9,220 $ (1,083 ) $ (4,797 ) $ 8,539 CMBS 13,021 1,120 (2,479 ) 3,821 15,483 Life company 1,913 1,865 (1,069 ) — 2,709 Life company – limited 414 167 (191 ) — 390 Total $ 20,547 $ 12,372 $ (4,822 ) $ (976 ) $ 27,121 Amounts capitalized represent mortgage servicing rights retained upon the sale of originated loans to Freddie Mac and mortgage servicing rights acquired without the exchange of initial consideration for the CMBS and life company tranches. The Company recorded mortgage servicing rights retained upon the sale of originated loans to Freddie Mac of $2.2 million and $8.5 million on $0.6 billion and $2.8 billion of loans, respectively, during the three and nine month periods ending September 30, 2016, respectively and $3.3 million and $9.2 million on $1.2 billion and $4.2 billion of loans, respectively, during the three and nine month periods ending September 30, 2015, respectively. The Company recorded mortgage servicing rights acquired without the exchange of initial consideration on the CMBS and Life company tranches of $0.8 million and $3.3 million on $1.8 billion and $8.4 billion of loans, respectively, during the three and nine month periods ending September 30, 2016, respectively and $1.4 million and $3.2 million on $2.5 billion and $6.9 billion of loans, respectively, during the three and nine month periods ending September 30, 2015. During the nine months ending September 30, 2016 and 2015, the Company sold the cashiering portion of certain Freddie Mac mortgage servicing rights. While the Company transferred the risks and rewards of ownership of the cashiering portion of the mortgage servicing rights, the Company continues to perform limited servicing activities on these loans for a reduced market-based fee. Therefore, the remaining servicing rights were transferred to the CMBS servicing tranche. The net result of these transactions was that the Company recorded a gain in the three and nine months ending September 30, 2016 of $0.0 million and $1.8 million, respectively, and $1.5 million and $2.9 million during the three and nine month periods ending September 30, 2015, respectively, within interest and other income, net in the consolidated statements of income. The Company also received securitization compensation in relation to the securitization of certain Freddie Mac loans for which the Company services in the three and nine months ending September 30, 2016 of $1.3 million and $4.2 million, respectively, and $1.6 million and $4.7 million during the three and nine month periods ending September 30, 2015, respectively. The securitization compensation is recorded within interest and other income, net in the consolidated statements of income. Amortization expense related to intangible assets was $2.2 million and $6.2 million during the three and nine month periods ended September 30, 2016 and $1.7 million and $4.8 million during the three and nine month periods ending September 30, 2015, respectively, and is recorded in depreciation and amortization in the consolidated statements of income. Estimated amortization expense for the next five years is as follows (dollars in thousands): Remainder of 2016 $ 2,095 2017 7,580 2018 6,082 2019 4,246 2020 3,394 2021 2,910 The weighted-average life of the mortgage servicing rights intangible asset was 6.3 years at September 30, 2016. |
Fair Value Measurement
Fair Value Measurement | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | 6. Fair Value Measurement ASC Topic 820, Fair Value Measurement In the normal course of business, the Company enters into contractual commitments to originate (purchase) and sell multifamily mortgage loans at fixed prices with fixed expiration dates. The commitments become effective when the borrowers “lock-in” a specified interest rate. To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers, the Company enters into a sale commitment with Freddie Mac simultaneously with the rate lock commitment with the borrower. The terms of the contract with Freddie Mac and the rate lock with the borrower are matched in substantially all respects to eliminate interest rate risk. Both the rate lock commitments to borrowers and the forward sale contracts to Freddie Mac are undesignated derivatives and, accordingly, are marked to fair value through earnings. The impact on our financial position and earnings resulting from loan commitments is not significant. The Company elected the fair value option for all mortgage notes receivable originated after January 1, 2016 to eliminate the impact of the variability in interest rate movements on the value of the mortgage notes receivable. The following table sets forth the Company’s financial assets that were accounted for at fair value on a recurring basis by level within the fair value hierarchy as of September 30, 2016 (in thousands): September 30, 2016 Fair Value Measurements Using: Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Recurring fair value measurements Mortgage notes receivable $ 826,851 $ — $ 826,851 $ — Total recurring fair value measurements $ 826,851 $ — $ 826,851 $ — The valuation of mortgage notes receivable is calculated based on already locked in interest rates. These assets are classified as Level 2 in the fair value hierarchy as all inputs are reasonably observable. There are no financial assets accounted for at fair value on a recurring basis at December 31, 2015. In accordance with GAAP, from time to time, the Company measures certain assets at fair value on a nonrecurring basis. These assets may include mortgage servicing rights and prior to January 1, 2016, mortgage notes receivable. The mortgage servicing rights are recorded at fair value upon initial recording and were not re-measured at fair value during the third quarter of 2016 because the Company continues to utilize the amortization method under ASC 860 and the fair value of the mortgage servicing rights exceeds the carrying value at September 30, 2016. The following table sets forth the Company’s financial assets that were accounted for at fair value on a nonrecurring basis by level within the fair value hierarchy as of September 30, 2016 and December 31, 2015 (in thousands): September 30, 2016 Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Nonrecurring fair value measurements Mortgage servicing rights $ 31,969 $ — $ — $ 43,910 Total nonrecurring fair value measurements $ 31,969 $ — $ — $ 43,910 December 31, 2015 Nonrecurring fair value measurements Mortgage notes receivable $ 318,951 $ — $ 318,951 $ — Mortgage servicing rights 26,922 — — 35,832 Total nonrecurring fair value measurements $ 345,873 — $ 318,951 $ 35,832 Mortgage servicing rights do not trade in an active, open market with readily-available observable prices. Since there is no ready market value for the mortgage servicing rights, such as quoted market prices or prices based on sales or purchases of similar assets, the Company determines the fair value of the mortgage servicing rights by estimating the present value of future cash flows associated with the servicing of the loans. Management makes certain assumptions and judgments in estimating the fair value of servicing rights, including the benefits of servicing (contractual servicing fees and interest on escrow and float balances), the cost of servicing, prepayment rates (including risk of default), an inflation rate, the expected life of the cash flows and the discount rate. The significant assumptions utilized to value servicing rights as of September 30, 2016 and December 31, 2015 are as follows: September 30, 2016 December 31, 2015 Expected life of cash flows 3 years to 11 years 3 years to 10 years Discount rate (1) 14% to 20% 14% to 20% Prepayment rate 0% to 8% 0% to 8% Inflation rate 2% 2% Cost of service per loan $1,600 to $3,996 $1,600 to $4,033 (1) Reflects the time value of money and the risk of future cash flows related to the possible cancellation of servicing contracts, transferability restrictions on certain servicing contracts, concentration in the life company portfolio and large loan risk. The above assumptions are subject to change based on management’s judgments and estimates of future changes in the risks related to future cash flows and interest rates. Changes in these factors would cause a corresponding increase or decrease in the prepayment rates and discount rates used in the Company’s valuation model. FASB ASC Topic 825, Financial Instruments Cash and Cash Equivalents Warehouse line of credit |
Capital Lease Obligations
Capital Lease Obligations | 9 Months Ended |
Sep. 30, 2016 | |
Leases [Abstract] | |
Capital Lease Obligations | 7. Capital Lease Obligations Capital lease obligations consist of the following at September 30, 2016 and December 31, 2015 (dollars in thousands): September 30, 2016 December 31, 2015 Capital lease obligations $ 790 $ 1,014 Less current maturities 574 500 $ 216 $ 514 Capital lease obligations consist primarily of office equipment leases that expire at various dates through November 2019. A summary of future minimum lease payments under capital leases at September 30, 2016 is as follows (dollars in thousands): Remainder of 2016 $ 136 2017 432 2018 198 2019 24 $ 790 |
Warehouse Line of Credit
Warehouse Line of Credit | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Warehouse Line of Credit | 8. Warehouse Line of Credit HFF LP maintains two uncommitted warehouse revolving lines of credit for the purpose of funding the Freddie Mac mortgage loans that it originates in connection with its services as a Freddie Mac Multifamily Approved Seller/Servicer for Conventional and Senior Housing Loans. The Company is a party to an uncommitted $450 million financing arrangement with PNC Bank, N.A. (“PNC”) that can be increased to $550 million four times a year for a period of 45 calendar days. The Company utilized a portion of this increase in September 2016. The Company is also party to an uncommitted $125 million financing arrangement with The Huntington National Bank (“Huntington”) that can be increased to $150 million three times in a one-year period for 30 business days. On September 30, 2016, HFF LP entered into an extended funding agreement with Freddie Mac whereby Freddie Mac can extend the required purchase date for each mortgage that has an Original Mandatory Funding Date (as defined in the agreement) occurring within the fourth quarter of 2016, to February 15, 2017. In connection with the extended funding agreement with Freddie Mac, PNC agreed to increase the financing arrangement to $2.0 billion. Once the extended funding agreement with Freddie Mac expires on February 15, 2017, the capacity under the PNC warehouse agreement will revert to $450 million. Each funding is separately approved on a transaction-by-transaction basis and is collateralized by a loan and mortgage on a multifamily property that is ultimately purchased by Freddie Mac. The PNC and Huntington financing arrangements are only for the purpose of supporting the Company’s participation in Freddie Mac’s Multifamily Approved Seller/Servicer for Conventional and Senior Housing Loans program and cannot be used for any other purpose. As of September 30, 2016 and December 31, 2015, HFF LP had $824.5 million and $318.6 million, respectively, outstanding on the warehouse lines of credit. Interest on the warehouse lines of credit is at the 30-day LIBOR rate (0.52% and 0.24% at September 30, 2016 and December 31, 2015, respectively) plus a spread. HFF LP is also paid interest on its loan secured by a multifamily loan at the rate in the Freddie Mac note. |
Lease Commitments
Lease Commitments | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Lease Commitments | 9. Lease Commitments The Company leases various corporate offices (which leases sometime include parking spaces) and office equipment under noncancelable operating leases. These leases have initial terms of three to eleven years. Several of the leases have termination clauses whereby the term may be reduced by two to seven years upon prior notice and payment of a termination fee by the Company. Total rental expense charged to operations was $3.0 million and $8.6 million, respectively, during the three and nine month periods ended September 30, 2016 and $2.7 million and $7.4 million, respectively, during the three and nine month periods ending September 30, 2015 and is recorded within occupancy expense in the consolidated statements of income. Future minimum rental payments for the next five years under operating leases with noncancelable terms in excess of one year and without regard to early termination provisions are as follows (dollars in thousands): Remainder of 2016 $ 2,250 2017 10,231 2018 9,860 2019 8,951 2020 8,116 2021 6,696 Thereafter 12,283 $ 58,387 The Company subleases certain office space to subtenants, which subleases may be canceled at any time. The rental income received from these subleases is included as a reduction of occupancy expenses in the accompanying consolidated statements of income. The Company also leases certain office equipment under capital leases that expire at various dates through 2019. See Note 4 and Note 7 above for further description of the assets and related obligations recorded under these capital leases at September 30, 2016 and December 31, 2015, respectively. |
Servicing
Servicing | 9 Months Ended |
Sep. 30, 2016 | |
Transfers and Servicing [Abstract] | |
Servicing | 10. Servicing The Company services commercial real estate loans for lenders. The unpaid principal balance of the servicing portfolio totaled $55.2 billion and $48.7 billion at September 30, 2016 and December 31, 2015, respectively. In connection with its servicing activities, the Company holds funds in escrow for the benefit of mortgagors for hazard insurance, real estate taxes and other financing arrangements. At September 30, 2016 and December 31, 2015, the funds held in escrow totaled $212.7 million and $177.5 million, respectively. These funds, and the offsetting liabilities of the borrowers to external parties, are not presented in the Company’s consolidated financial statements as they do not represent the assets and liabilities of the Company. Pursuant to the requirements of the various investors for which the Company services loans, the Company maintains bank accounts, holding escrow funds, which have balances in excess of the FDIC insurance limit. The fees earned on these escrow funds are reported in capital markets services revenue in the consolidated statements of income. |
Legal Proceedings
Legal Proceedings | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings | 11. Legal Proceedings The Company is party to various litigation matters, in most cases involving ordinary course and routine claims incidental to its business. The Company cannot estimate with certainty its ultimate legal and financial liability with respect to any pending matters. In accordance with ASC 450, Contingencies, |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 12. Income Taxes Income tax expense includes current and deferred taxes as follows (dollars in thousands): Current Deferred Total Nine months ended September 30, 2016: Federal $ 14,897 $ 13,528 $ 28,425 State 2,925 546 3,471 $ 17,822 $ 14,074 $ 31,896 Current Deferred Total Nine months ended September 30, 2015: Federal $ 20,157 $ 9,577 $ 29,734 State 3,627 2,717 6,344 $ 23,784 $ 12,294 $ 36,078 The reconciliation between the income tax computed by applying the U.S. federal statutory rate and the effective tax rate on net income is as follows for the nine months ended September 30, 2016 and 2015 (dollars in thousands): September 30, 2016 2015 Income tax expense / (benefit) Rate Rate Taxes computed at federal rate $ 28,573 35.0 % $ 30,071 35.0 % State and local taxes, net of federal tax benefit 3,288 4.0 % 3,261 3.8 % Effect of deferred tax rate change (1,188 ) (1.5 )% 2,621 3.1 % Change in income tax benefit payable to stockholder 206 0.3 % (451 ) (0.5 )% Provision to return adjustment 196 0.2 % (130 ) (0.2 )% Meals and entertainment 789 1.0 % 693 0.8 % Other 32 0.0 % 13 0.0 % Income tax expense $ 31,896 39.1 % $ 36,078 42.0 % Deferred income tax assets and liabilities consist of the following at September 30, 2016 and December 31, 2015 (dollars in thousands): September 30, 2016 December 31, 2015 Deferred income tax assets: Section 754 election tax basis step-up $ 120,806 $ 129,862 Tenant improvements 3,456 3,118 Restricted stock units 7,286 6,229 Compensation (160 ) 4,267 Intangible asset 399 425 Other 627 465 Deferred income tax asset 132,414 144,366 Deferred income tax liabilities: Goodwill (1,272 ) (1,262 ) Servicing rights (13,860 ) (10,827 ) Deferred rent (1,683 ) (1,822 ) Investment in partnership (582 ) (578 ) Deferred income tax liability (17,397 ) (14,489 ) Net deferred income tax asset $ 115,017 $ 129,877 The primary deferred tax asset represents a tax basis step-up election under Section 754 of the Internal Revenue Code (“Section 754”) made by the Company relating to the initial purchase of units of the Operating Partnerships in connection with the Reorganization Transactions and a tax basis step-up on subsequent exchanges of Operating Partnership units for shares of the Company’s Class A common stock since the date of the Reorganization Transactions. As a result of the step-up in basis from these transactions, the Company is entitled to annual future tax benefits in the form of amortization for income tax purposes. The annual pre-tax benefit on the Section 754 step-up and past payments under the tax receivable agreement was approximately $120.8 million at September 30, 2016. To the extent that the Company does not have sufficient taxable income in a year to fully utilize this annual deduction, the unused benefit is recharacterized as a net operating loss and can then be carried back two years or carried forward for twenty years. The Company measured the deferred tax asset based on the estimated income tax effects of the increase in the tax basis of the assets owned by the Operating Partnerships utilizing the enacted tax rates at the date of the transaction. All subsequent changes in the measurement of the deferred tax assets due to changes in the enacted tax rates or changes in the valuation allowance, if any, are recorded as a component of income tax expense. In evaluating the realizability of the deferred tax assets, management makes estimates and judgments regarding the level and timing of future taxable income, including projecting future revenue growth and changes to the cost structure. In order to realize the anticipated 2016 pre-tax benefit of approximately $34.6 million, the Company needs to generate approximately $305 million in revenue during 2016, assuming a constant cost structure. In the event that the Company cannot realize the anticipated 2016 pre-tax benefit of $34.6 million, the shortfall becomes a net operating loss that can be carried back two years to offset prior years’ taxable income or carried forward twenty years to offset future taxable income. Based on this analysis and other quantitative and qualitative factors, management believes that it is currently more likely than not that the Company will be able to generate sufficient taxable income to realize the net deferred tax assets resulting from the basis step up transactions (initial sale of units in the Operating Partnerships and subsequent exchanges of Operating Partnership units since the date of the Reorganization Transactions). The Company has no federal or state net operating losses at September 30, 2016. The Company has analyzed the need for a reserve for unrecognized tax benefits under ASC 740-10 and has determined that any such tax benefits do not have a material impact on the financial statements. It is not expected that there will be a significant increase or decrease in the amount of unrecognized tax benefits within the next 12 months. With few exceptions, the Company is no longer subject to US federal or state and local tax examination by tax authorities before 2011. The Company will recognize interest and penalties related to unrecognized tax benefits in interest and other income, net in the consolidated statements of income. There were no interest or penalties recorded in the three and nine month periods ending September 30, 2016 and 2015. Tax Receivable Agreement In connection with the Reorganization Transactions, HFF LP and HFF Securities made an election under Section 754 for 2007 and kept that election in effect for each taxable year in which an exchange of Operating Partnership units for shares of the Company’s Class A common stock occurred. The initial sale as a result of the Offering and subsequent exchanges of Operating Partnership units for shares of Class A common stock produced increases in the tax basis of the assets owned by HFF LP and HFF Securities to their fair market value. This increase in tax basis allows the Company to reduce the amount of tax payments to the extent that the Company has taxable income. As a result of the increase in tax basis, the Company is entitled to future tax benefits of $120.8 million and has recorded this amount as a deferred tax asset on its consolidated balance sheet. The Company has updated its estimate of these future tax benefits based on the changes to the estimated annual effective tax rate for 2016. The Company is obligated, however, pursuant to its tax receivable agreement with HFF Holdings, to pay to HFF Holdings 85% of the amount of cash savings in U.S. federal, state and local income tax that the Company actually realizes as a result of these increases in tax basis and as a result of certain other tax benefits arising from the Company entering into the tax receivable agreement and making payments under that agreement. For purposes of the tax receivable agreement, actual cash savings in income tax is computed by comparing the Company’s actual income tax liability to the amount of such taxes that it would have been required to pay had there been no increase to the tax basis of the assets of HFF LP and HFF Securities as a result of the initial sale and later exchanges had the Company not entered into the tax receivable agreement. The Company accounted for the income tax effects and corresponding tax receivable agreement effects as a result of the initial purchase and the sale of units of the Operating Partnerships in connection with the Reorganization Transactions and subsequent exchanges of Operating Partnership units for the Company’s Class A shares, by recognizing a deferred tax asset for the estimated income tax effects of the increase in the tax basis of the assets owned by the Operating Partnerships, based on enacted tax rates at the date of the transaction, less any tax valuation allowance the Company believes is required. Subsequent changes in enacted tax rates or any valuation allowance are recorded as a component of income tax expense. The Company believes it is more likely than not that it will realize the benefit represented by the deferred tax asset, and, therefore, the Company recorded 85% of this estimated amount of the increase in deferred tax assets as a liability to HFF Holdings under the tax receivable agreement and the remaining 15% of the increase in deferred tax assets directly in additional paid-in capital in stockholders’ equity at the time of each exchange of Operating Partnership partnership units for shares of the Company’s Class A common stock. As of August 31, 2012, all of the Operating Partnership partnership units have been exchanged. While the actual amount and timing of payments under the tax receivable agreement depend upon a number of factors, including the amount and timing of taxable income generated in the future, changes in future tax rates, the value of individual assets, the portion of the Company’s payments under the tax receivable agreement constituting imputed interest and increases in the tax basis of the Company’s assets resulting in payments to HFF Holdings, the Company has estimated that the future payments that will be made to HFF Holdings will be $111.4 million, and has recorded this obligation to HFF Holdings as a liability on the consolidated balance sheet. To the extent the Company does not realize all of the tax benefits in future years, this liability to HFF Holdings may be reduced. In conjunction with the filing of the Company’s 2015 federal and state tax returns, the benefit for 2015 relating to the Section 754 basis step-up was finalized, resulting in $12.7 million of tax benefits being realized by the Company. As discussed above, the Company is obligated to remit to HFF Holdings 85% of any such cash savings in federal and state tax. As such, during the third quarter of 2016, the Company paid $10.8 million to HFF Holdings under the tax receivable agreement. As of September 30, 2016, the Company has made payments to HFF Holdings pursuant to the terms of the tax receivable agreement in an aggregate amount of approximately $74.2 million and the Company anticipates making a payment of $11.3 million to HFF Holdings in 2017. |
Stockholders Equity
Stockholders Equity | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Stockholders Equity | 13. Stockholders Equity The Company is authorized to issue 175,000,000 shares of Class A common stock, par value $0.01 per share. Each share of Class A common stock entitles its holder to one vote on all matters to be voted on by stockholders generally. Holders of Class A common stock vote together as a single class on all matters presented to the stockholders for their vote or approval. The Company had issued 38,463,448 and 38,351,367 shares of Class A common stock as of September 30, 2016 and December 31, 2015, respectively. On January 22, 2016, the board of directors declared a special cash dividend of $1.80 per share of Class A common stock to stockholders of record on February 8, 2016. The aggregate dividend payment was paid on February 19, 2016 and totaled approximately $68.4 million based on the number of shares of Class A common stock then outstanding. Holders of unvested, and vested but not issued, restricted stock units were granted, in the aggregate, 82,536 additional restricted stock units as of the record date of February 8, 2016. These units follow the same vesting terms as the underlying restricted stock units. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 14. Earnings Per Share The Company’s net income and weighted average shares outstanding for the three and nine month periods ended September 30, 2016 and 2015 consist of the following (dollars in thousands): Three months ended September 30, Nine months ended September 30, 2016 2015 2016 2015 Net income $ 20,020 $ 19,256 $ 49,742 $ 49,839 Weighted Average Shares Outstanding: Basic 38,273,684 38,001,399 38,234,868 37,963,954 Diluted 38,958,377 38,554,028 38,764,829 38,394,930 The calculations of basic and diluted net income per share amounts for the three and nine month periods ended September 30, 2016 and 2015 are described and presented below. Basic Net Income per Share Numerator Denominator Diluted Net Income per Share Numerator Denominator Three months ended September 30, Nine months ended September 30, 2016 2015 2016 2015 Basic Earnings Per Share of Class A Common Stock Numerator: Net income $ 20,020 $ 19,256 $ 49,742 $ 49,839 Denominator: Weighted average number of shares of Class A common stock outstanding 38,273,684 38,001,399 38,234,868 37,963,954 Basic net income per share of Class A common stock $ 0.52 $ 0.51 $ 1.30 $ 1.31 Diluted Earnings Per Share of Class A Common Stock Numerator: Net income $ 20,020 $ 19,256 $ 49,742 $ 49,839 Denominator: Basic weighted average number of shares of Class A common stock 38,273,684 38,001,399 38,234,868 37,963,954 Add—dilutive effect of: Unvested restricted stock units 672,888 530,758 518,127 408,786 Stock options 11,805 21,871 11,834 22,190 Weighted average common shares outstanding—diluted 38,958,377 38,554,028 38,764,829 38,394,930 Diluted earnings per share of Class A common stock $ 0.51 $ 0.50 $ 1.28 $ 1.30 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 15. Related Party Transactions As a result of the Company’s initial public offering, the Company entered into a tax receivable agreement with HFF Holdings that provides for the payment by the Company to HFF Holdings of 85% of the amount of the cash savings in U.S. federal, state and local income tax that the Company actually realizes as a result of the increase in tax basis of the assets owned by HFF LP and HFF Securities and as a result of certain other tax benefits arising from entering into the tax receivable agreement and making payments under that agreement. As members of HFF Holdings, each of Mark Gibson, the Company’s chief executive officer, Jody Thornton, the Company’s president and member of the Company’s board of directors and a transaction professional of the Operating Partnerships, John Fowler, a current director emeritus of the Company’s board of directors and a transaction professional of the Operating Partnerships, and Matthew D. Lawton, Gerard T. Sansosti, Michael J. Tepedino and Manuel A. de Zarraga, each an Executive Managing Director and a transaction professional of the Operating Partnerships, is entitled to participate in such payments, in each case on a pro rata basis based upon such person’s ownership of interests in each series of tax receivable payments created by the initial public offering or subsequent exchange of Operating Partnership units. During the third quarter of 2016, Messrs. Gibson, Thornton, Fowler, Lawton, Sansosti, Tepedino and de Zarraga received payments of $0.8 million, $0.8 million, $0.7 million, $0.2 million, $0.4 million, $0.2 million and $0.2 million, respectively, in connection with the Company’s payment of $10.8 million to HFF Holdings under the tax receivable agreement. During the third quarter of 2015, Messrs. Gibson, Thornton, Fowler, Lawton, Sansosti, Tepedino and de Zarraga received payments of $0.9 million, $0.8 million, $0.7 million, $0.2 million, $0.4 million, $0.2 million and $0.2 million, respectively, in connection with the Company’s payment of $10.8 million to HFF Holdings under the tax receivable agreement. The Company retains the remaining 15% of cash savings in income tax that it realizes. For purposes of the tax receivable agreement, cash savings in income tax is computed by comparing the Company’s actual income tax liability to the amount of such taxes that it would have been required to pay had there been no increase to the tax basis of the assets of HFF LP and HFF Securities allocable to the Company as a result of the initial sale and later exchanges and had the Company not entered into the tax receivable agreement. The term of the tax receivable agreement commenced upon consummation of the initial public offering and will continue until all such tax benefits have been utilized or have expired. See Note 12 for further information regarding the tax receivable agreement and Note 16 for the amount recorded in relation to this agreement. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 16. Commitments and Contingencies The Company is obligated, pursuant to its tax receivable agreement with HFF Holdings, to pay to HFF Holdings 85% of the amount of cash savings in U.S. federal, state and local income tax that the Company actually realizes as a result of the increases in tax basis under Section 754 and as a result of certain other tax benefits arising from the Company entering into the tax receivable agreement and making payments under that agreement. The Company has recorded $111.4 million and $121.2 million for this obligation to HFF Holdings as a liability on the consolidated balance sheet as of September 30, 2016 and December 31, 2015, respectively. In recent years, the Company has entered into arrangements with newly-hired transaction professionals whereby these transaction professionals would be paid additional compensation if certain performance targets are met over a defined period. These payments will be made to the transaction professionals only if they enter into an employment agreement at the end of the performance period. Payments under these arrangements, if earned, would be paid in fiscal years 2016 through 2019. Currently, the Company cannot reasonably estimate the amounts that would be payable under all of these arrangements. The Company begins to accrue for these payments when it is deemed probable that payments will be made; therefore, on a quarterly basis, the Company evaluates the probability of each of the transaction professionals achieving the performance targets and the probability of each of the transaction professionals signing an employment agreement. There was no accrual required for these arrangements as of September 30, 2016. At December 31, 2015, $5.8 million was accrued for these arrangements on the consolidated balance sheet and was paid in the first quarter of 2016. |
Organization and Basis of Pre23
Organization and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements of the Company as of September 30, 2016 and December 31, 2015 and for the three and nine month periods ended September 30, 2016 and September 30, 2015, include the accounts of HFF LP, HFF Securities, and the Company’s wholly-owned subsidiaries, Holliday GP and HoldCo LLC. All significant intercompany accounts and transactions have been eliminated. |
Equity Compensation | In March 2016, the Financial Accounting Standards Board (“FASB”) issued changes to the accounting for equity compensation. This update simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. This update will be effective for the Company beginning in fiscal year 2017. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. |
Leases | In February 2016, the FASB issued new guidance on the accounting for leases. This new guidance will require that a lessee recognize assets and liabilities on the balance sheet for all leases with a lease term of more than twelve months, with the result being the recognition of a right of use asset and a lease liability. The new lease accounting requirements are effective for the Company’s 2019 fiscal year with a modified retrospective transition approach required, with early adoption permitted. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. |
Revenue Recognition | In May 2014, the FASB issued changes to revenue recognition with customers. This update provides a five-step analysis of transactions to determine when and how revenue is recognized. An entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update will be effective for the Company beginning in fiscal year 2018. This update may be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying this update recognized at the date of initial application. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. |
Fair Value Measurement | ASC Topic 820, Fair Value Measurement |
Financial Instruments | FASB ASC Topic 825, Financial Instruments Cash and Cash Equivalents Warehouse line of credit |
Contingencies | The Company is party to various litigation matters, in most cases involving ordinary course and routine claims incidental to its business. The Company cannot estimate with certainty its ultimate legal and financial liability with respect to any pending matters. In accordance with ASC 450, Contingencies, |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment consist of the following (dollars in thousands): September 30, 2016 December 31, 2015 Furniture and equipment $ 7,685 $ 7,055 Computer equipment 1,950 1,555 Capitalized software costs 1,375 882 Leasehold improvements 15,754 13,454 Subtotal 26,764 22,946 Less accumulated depreciation and amortization (11,247 ) (9,354 ) $ 15,517 $ 13,592 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | The Company’s intangible assets are summarized as follows (dollars in thousands): September 30, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value Amortizable intangible assets: Mortgage servicing rights $ 58,484 $ (26,515 ) $ 31,969 $ 49,771 $ (22,849 ) $ 26,922 Unamortizable intangible assets: FINRA license 100 — 100 100 — 100 Total intangible assets $ 58,584 $ (26,515 ) $ 32,069 $ 49,871 $ (22,849 ) $ 27,022 |
Summary of Carrying and Fair Value of Mortgage Servicing Rights | Changes in the carrying value of mortgage servicing rights for the nine month periods ended September 30, 2016 and 2015, were as follows (dollars in thousands): Category 12/31/15 Capitalized Amortized Sold / 9/30/16 Freddie Mac $ 7,074 $ 8,460 $ (1,576 ) $ (2,450 ) $ 11,508 CMBS 16,768 778 (3,001 ) 1,948 16,493 Life company 2,729 2,154 (1,448 ) — 3,435 Life company – limited 351 404 (222 ) — 533 Total $ 26,922 $ 11,796 $ (6,247 ) $ (502 ) $ 31,969 Category 12/31/14 Capitalized Amortized Sold / 9/30/15 Freddie Mac $ 5,199 $ 9,220 $ (1,083 ) $ (4,797 ) $ 8,539 CMBS 13,021 1,120 (2,479 ) 3,821 15,483 Life company 1,913 1,865 (1,069 ) — 2,709 Life company – limited 414 167 (191 ) — 390 Total $ 20,547 $ 12,372 $ (4,822 ) $ (976 ) $ 27,121 |
Summary of Estimated Amortization Expense | Estimated amortization expense for the next five years is as follows (dollars in thousands): Remainder of 2016 $ 2,095 2017 7,580 2018 6,082 2019 4,246 2020 3,394 2021 2,910 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Financial Assets Accounted at Fair Value on Recurring Basis | The following table sets forth the Company’s financial assets that were accounted for at fair value on a recurring basis by level within the fair value hierarchy as of September 30, 2016 (in thousands): September 30, 2016 Fair Value Measurements Using: Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Recurring fair value measurements Mortgage notes receivable $ 826,851 $ — $ 826,851 $ — Total recurring fair value measurements $ 826,851 $ — $ 826,851 $ — |
Financial Assets Accounted at Fair Value on Nonrecurring Basis | The following table sets forth the Company’s financial assets that were accounted for at fair value on a nonrecurring basis by level within the fair value hierarchy as of September 30, 2016 and December 31, 2015 (in thousands): September 30, 2016 Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Nonrecurring fair value measurements Mortgage servicing rights $ 31,969 $ — $ — $ 43,910 Total nonrecurring fair value measurements $ 31,969 $ — $ — $ 43,910 December 31, 2015 Nonrecurring fair value measurements Mortgage notes receivable $ 318,951 $ — $ 318,951 $ — Mortgage servicing rights 26,922 — — 35,832 Total nonrecurring fair value measurements $ 345,873 — $ 318,951 $ 35,832 |
Significant Assumptions Utilized to Value Servicing Rights | The significant assumptions utilized to value servicing rights as of September 30, 2016 and December 31, 2015 are as follows: September 30, 2016 December 31, 2015 Expected life of cash flows 3 years to 11 years 3 years to 10 years Discount rate (1) 14% to 20% 14% to 20% Prepayment rate 0% to 8% 0% to 8% Inflation rate 2% 2% Cost of service per loan $1,600 to $3,996 $1,600 to $4,033 (1) Reflects the time value of money and the risk of future cash flows related to the possible cancellation of servicing contracts, transferability restrictions on certain servicing contracts, concentration in the life company portfolio and large loan risk. |
Capital Lease Obligations (Tabl
Capital Lease Obligations (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Leases [Abstract] | |
Summary of Capital Lease Obligations | Capital lease obligations consist of the following at September 30, 2016 and December 31, 2015 (dollars in thousands): September 30, 2016 December 31, 2015 Capital lease obligations $ 790 $ 1,014 Less current maturities 574 500 $ 216 $ 514 |
Summary of Future Minimum Lease Payments Under Capital Leases | Capital lease obligations consist primarily of office equipment leases that expire at various dates through November 2019. A summary of future minimum lease payments under capital leases at September 30, 2016 is as follows (dollars in thousands): Remainder of 2016 $ 136 2017 432 2018 198 2019 24 $ 790 |
Lease Commitments (Tables)
Lease Commitments (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Future Minimum Rental Payments | Future minimum rental payments for the next five years under operating leases with noncancelable terms in excess of one year and without regard to early termination provisions are as follows (dollars in thousands): Remainder of 2016 $ 2,250 2017 10,231 2018 9,860 2019 8,951 2020 8,116 2021 6,696 Thereafter 12,283 $ 58,387 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Summary of Income Tax Expense Includes Current and Deferred Taxes | Income tax expense includes current and deferred taxes as follows (dollars in thousands): Current Deferred Total Nine months ended September 30, 2016: Federal $ 14,897 $ 13,528 $ 28,425 State 2,925 546 3,471 $ 17,822 $ 14,074 $ 31,896 Current Deferred Total Nine months ended September 30, 2015: Federal $ 20,157 $ 9,577 $ 29,734 State 3,627 2,717 6,344 $ 23,784 $ 12,294 $ 36,078 |
Summary of Income Tax Expense Allocation | The reconciliation between the income tax computed by applying the U.S. federal statutory rate and the effective tax rate on net income is as follows for the nine months ended September 30, 2016 and 2015 (dollars in thousands): September 30, 2016 2015 Income tax expense / (benefit) Rate Rate Taxes computed at federal rate $ 28,573 35.0 % $ 30,071 35.0 % State and local taxes, net of federal tax benefit 3,288 4.0 % 3,261 3.8 % Effect of deferred tax rate change (1,188 ) (1.5 )% 2,621 3.1 % Change in income tax benefit payable to stockholder 206 0.3 % (451 ) (0.5 )% Provision to return adjustment 196 0.2 % (130 ) (0.2 )% Meals and entertainment 789 1.0 % 693 0.8 % Other 32 0.0 % 13 0.0 % Income tax expense $ 31,896 39.1 % $ 36,078 42.0 % |
Summary of Deferred Income Tax Assets and Liabilities | Deferred income tax assets and liabilities consist of the following at September 30, 2016 and December 31, 2015 (dollars in thousands): September 30, 2016 December 31, 2015 Deferred income tax assets: Section 754 election tax basis step-up $ 120,806 $ 129,862 Tenant improvements 3,456 3,118 Restricted stock units 7,286 6,229 Compensation (160 ) 4,267 Intangible asset 399 425 Other 627 465 Deferred income tax asset 132,414 144,366 Deferred income tax liabilities: Goodwill (1,272 ) (1,262 ) Servicing rights (13,860 ) (10,827 ) Deferred rent (1,683 ) (1,822 ) Investment in partnership (582 ) (578 ) Deferred income tax liability (17,397 ) (14,489 ) Net deferred income tax asset $ 115,017 $ 129,877 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Summary of Net Income and Weighted Average Shares Outstanding | The Company’s net income and weighted average shares outstanding for the three and nine month periods ended September 30, 2016 and 2015 consist of the following (dollars in thousands): Three months ended September 30, Nine months ended September 30, 2016 2015 2016 2015 Net income $ 20,020 $ 19,256 $ 49,742 $ 49,839 Weighted Average Shares Outstanding: Basic 38,273,684 38,001,399 38,234,868 37,963,954 Diluted 38,958,377 38,554,028 38,764,829 38,394,930 |
Summary of Calculations of Basic and Diluted Net Income per Share | Three months ended September 30, Nine months ended September 30, 2016 2015 2016 2015 Basic Earnings Per Share of Class A Common Stock Numerator: Net income $ 20,020 $ 19,256 $ 49,742 $ 49,839 Denominator: Weighted average number of shares of Class A common stock outstanding 38,273,684 38,001,399 38,234,868 37,963,954 Basic net income per share of Class A common stock $ 0.52 $ 0.51 $ 1.30 $ 1.31 Diluted Earnings Per Share of Class A Common Stock Numerator: Net income $ 20,020 $ 19,256 $ 49,742 $ 49,839 Denominator: Basic weighted average number of shares of Class A common stock 38,273,684 38,001,399 38,234,868 37,963,954 Add—dilutive effect of: Unvested restricted stock units 672,888 530,758 518,127 408,786 Stock options 11,805 21,871 11,834 22,190 Weighted average common shares outstanding—diluted 38,958,377 38,554,028 38,764,829 38,394,930 Diluted earnings per share of Class A common stock $ 0.51 $ 0.50 $ 1.28 $ 1.30 |
Organization and Basis of Pre31
Organization and Basis of Presentation - Additional Information (Detail) | 9 Months Ended | |||
Sep. 30, 2016Officeshares | Dec. 31, 2015shares | Jan. 30, 2007$ / sharesshares | Nov. 09, 2006shares | |
Class of Stock [Line Items] | ||||
Number of offices in the United States | Office | 23 | |||
IPO [Member] | ||||
Class of Stock [Line Items] | ||||
Percentage of shares purchase from Partners | 44.70% | |||
Class A Common Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Common stock, shares authorized | 175,000,000 | 175,000,000 | ||
Sale of common stock, shares | 38,463,448 | 38,351,367 | ||
Class A Common Stock [Member] | HFF Holdings [Member] | ||||
Class of Stock [Line Items] | ||||
Sale of common stock, shares | 38,463,448 | 38,351,367 | ||
Class A Common Stock [Member] | IPO [Member] | ||||
Class of Stock [Line Items] | ||||
Common share proposed for public offering | 14,300,000 | |||
Common stock, shares authorized | 14,300,000 | |||
Initial public offering price, per share | $ / shares | $ 18 | |||
Common Class B [Member] | IPO [Member] | HFF Holdings [Member] | ||||
Class of Stock [Line Items] | ||||
Sale of common stock, shares | 1 |
Summary of Significant Accoun32
Summary of Significant Accounting Policies - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2016 | |
Summary Of Significant Accounting Policies [Line Items] | |
Vesting period | 26 months |
Amended Office and Firm Profit Participation Plans [Member] | |
Summary Of Significant Accounting Policies [Line Items] | |
Vesting period | 50 months |
Stock Compensation - Additional
Stock Compensation - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock compensation cost | $ 2,900 | $ 1,800 | $ 8,941 | $ 6,394 |
Options, Granted | 0 | |||
Options, Vested | 0 | |||
Options, Forfeited | 0 | |||
Options, Exercised | 0 | |||
Restricted Stock Units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized compensation cost related to non-vested restricted stock units | $ 31,000 | $ 31,000 | ||
Weighted average contractual term | 2 years 9 months 18 days | |||
Restricted stock units outstanding | 2,082,189 | 2,082,189 | ||
Number of stock units with continued vesting requirements | 1,892,804 | 1,892,804 | ||
Restricted stock units, Granted | 16,756 | |||
Restricted stock units, forfeited | 0 | |||
Restricted stock units vested | 4,393 | |||
Fair value of restricted stock units | $ 5,200 | |||
Restricted Stock Units [Member] | Class A Common Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock units, Granted | 4,393 | |||
Restricted stock units outstanding, Converted to common stock | 4,393 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | $ 26,764 | $ 22,946 |
Less accumulated depreciation and amortization | (11,247) | (9,354) |
Property, plant and equipment, net | 15,517 | 13,592 |
Furniture and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | 7,685 | 7,055 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | 1,950 | 1,555 |
Capitalized Software Costs [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | 1,375 | 882 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | $ 15,754 | $ 13,454 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Capital leased office equipment recorded in furniture and equipment | $ 26,764 | $ 22,946 |
Accumulated depreciation and amortization of capital leased office equipment included in consolidated statements | 11,247 | 9,354 |
Office Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Capital leased office equipment recorded in furniture and equipment | 1,900 | 1,700 |
Accumulated depreciation and amortization of capital leased office equipment included in consolidated statements | $ 1,200 | $ 800 |
Intangible Assets - Summary of
Intangible Assets - Summary of Intangible Assets (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets Gross Carrying Amount | $ 58,584 | $ 49,871 |
Accumulated Amortization | (26,515) | (22,849) |
Total intangible assets Net Book Value | 32,000 | 26,900 |
Total intangible assets Net Book Value | 32,069 | 27,022 |
FINRA License [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 100 | 100 |
Accumulated Amortization | 0 | 0 |
Total intangible assets Net Book Value | 100 | 100 |
Mortgage Servicing Rights [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 58,484 | 49,771 |
Accumulated Amortization | (26,515) | (22,849) |
Total intangible assets Net Book Value | $ 31,969 | $ 26,922 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Commercial loans serviced by the Company | $ 55,200,000 | $ 55,200,000 | $ 48,700,000 | ||
Servicing fees and interest earned | 5,800 | $ 5,300 | 17,000 | $ 14,700 | |
Mortgage servicing rights | 32,000 | 32,000 | 26,900 | ||
Loan served for mortgage servicing rights | 53,600,000 | 53,600,000 | $ 45,200,000 | ||
Gain on sale of cashiering portion | 0 | 1,500 | 1,800 | 2,900 | |
Amortization expenses | $ 6,248 | 4,822 | |||
Weighted-average life of mortgage servicing rights | 6 years 3 months 18 days | ||||
Freddie Mac [Member] | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Mortgage servicing rights retained upon sale | 2,200 | 3,300 | $ 8,500 | 9,200 | |
Originated loans, net | 600,000 | 1,200,000 | 2,800,000 | 4,200,000 | |
Amortization expenses | 2,200 | 1,700 | 6,200 | 4,800 | |
Freddie Mac [Member] | Interest and Other Income, Net [Member] | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Securitization compensation received | 1,300 | 1,600 | 4,200 | 4,700 | |
CMBS [Member] | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Mortgage servicing rights acquired without exchange of initial consideration | 800 | 1,400 | 800 | 1,400 | |
Initial consideration, net | 1,800,000 | 2,500,000 | 1,800,000 | 2,500,000 | |
Life Company Tranches [Member] | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Mortgage servicing rights acquired without exchange of initial consideration | 3,300 | 3,200 | 3,300 | 3,200 | |
Initial consideration, net | $ 8,400,000 | $ 6,900,000 | $ 8,400,000 | $ 6,900,000 |
Intangible Assets - Summary o38
Intangible Assets - Summary of Carrying and Fair Value of Mortgage Servicing Rights (Detail) - Mortgage Servicing Rights [Member] - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Opening Balance | $ 26,922 | $ 20,547 |
Capitalized | 11,796 | 12,372 |
Amortized | (6,247) | (4,822) |
Sold/Transferred | (502) | (976) |
Closing Balance | 31,969 | 27,121 |
Freddie Mac [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Opening Balance | 7,074 | 5,199 |
Capitalized | 8,460 | 9,220 |
Amortized | (1,576) | (1,083) |
Sold/Transferred | (2,450) | (4,797) |
Closing Balance | 11,508 | 8,539 |
CMBS [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Opening Balance | 16,768 | 13,021 |
Capitalized | 778 | 1,120 |
Amortized | (3,001) | (2,479) |
Sold/Transferred | 1,948 | 3,821 |
Closing Balance | 16,493 | 15,483 |
Life Company [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Opening Balance | 2,729 | 1,913 |
Capitalized | 2,154 | 1,865 |
Amortized | (1,448) | (1,069) |
Closing Balance | 3,435 | 2,709 |
Life Company - Limited [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Opening Balance | 351 | 414 |
Capitalized | 404 | 167 |
Amortized | (222) | (191) |
Closing Balance | $ 533 | $ 390 |
Intangible Assets - Summary o39
Intangible Assets - Summary of Estimated Amortization Expense (Detail) $ in Thousands | Sep. 30, 2016USD ($) |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | |
Remainder of 2016 | $ 2,095 |
2,017 | 7,580 |
2,018 | 6,082 |
2,019 | 4,246 |
2,020 | 3,394 |
2,021 | $ 2,910 |
Fair Value Measurement - Financ
Fair Value Measurement - Financial Assets Accounted at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Carrying Value [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mortgage notes receivable | $ 826,851 | $ 318,951 |
Total recurring fair value measurements | 826,851 | |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mortgage notes receivable | 826,851 | $ 318,951 |
Total recurring fair value measurements | $ 826,851 |
Fair Value Measurement - Additi
Fair Value Measurement - Additional Information (Detail) | Dec. 31, 2015USD ($) |
Fair Value Recurring [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets at fair value | $ 0 |
Fair Value Measurement - Fina42
Fair Value Measurement - Financial Assets Accounted at Fair Value on Nonrecurring Basis (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mortgage servicing rights | $ 32,000 | $ 26,900 |
Carrying Value [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mortgage notes receivable | 826,851 | 318,951 |
Mortgage servicing rights | 31,969 | 26,922 |
Total nonrecurring fair value measurements | 31,969 | 345,873 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mortgage notes receivable | 826,851 | 318,951 |
Total nonrecurring fair value measurements | 318,951 | |
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mortgage servicing rights | 43,910 | 35,832 |
Total nonrecurring fair value measurements | $ 43,910 | $ 35,832 |
Fair Value Measurement - Signif
Fair Value Measurement - Significant Assumptions Utilized to Value Servicing Rights (Detail) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Minimum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Expected life of cash flows | 3 years | 3 years |
Discount rate | 14.00% | 14.00% |
Prepayment rate | 0.00% | 0.00% |
Cost of service per loan | $ 1,600 | $ 1,600 |
Maximum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Expected life of cash flows | 11 years | 10 years |
Discount rate | 20.00% | 20.00% |
Prepayment rate | 8.00% | 8.00% |
Inflation rate | 2.00% | 2.00% |
Cost of service per loan | $ 3,996 | $ 4,033 |
Capital Lease Obligations - Sum
Capital Lease Obligations - Summary of Capital Lease Obligations (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Capital Lease Obligations [Abstract] | ||
Capital lease obligations | $ 790 | $ 1,014 |
Less current maturities | 574 | 500 |
Capital lease obligations, non current maturities | $ 216 | $ 514 |
Capital Lease Obligation - Addi
Capital Lease Obligation - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2016 | |
Leases [Abstract] | |
Lease Expiration Date | Nov. 30, 2019 |
Capital Lease Obligation - Summ
Capital Lease Obligation - Summary of Future Minimum Lease Payments Under Capital Leases (Detail) $ in Thousands | Sep. 30, 2016USD ($) |
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
Remainder of 2016 | $ 136 |
2,017 | 432 |
2,018 | 198 |
2,019 | 24 |
Total | $ 790 |
Warehouse Line of Credit - Addi
Warehouse Line of Credit - Additional Information (Detail) | 9 Months Ended | |
Sep. 30, 2016USD ($)Warehouse_Line_of_Credit | Dec. 31, 2015USD ($) | |
Line of Credit Facility [Line Items] | ||
Number of warehouse line of credit facilities | Warehouse_Line_of_Credit | 2 | |
Warehouse line of credit outstanding amount | $ 824,500,000 | $ 318,600,000 |
Line of credit interest rate at the end of the period | 0.52% | 0.24% |
LIBOR rate duration period | 30 days | |
Line of credit interest rate description | Interest on the warehouse lines of credit is at the 30-day LIBOR rate (0.52% and 0.24% at September 30, 2016 and December 31, 2015, respectively) plus a spread. HFF LP is also paid interest on its loan secured by a multifamily loan at the rate in the Freddie Mac note. | |
PNC Bank, N.A. [Member] | ||
Line of Credit Facility [Line Items] | ||
Uncommitted financing arrangement | $ 450,000,000 | |
Committed financing arrangement | 2,000,000,000 | |
Huntington Bank [Member] | ||
Line of Credit Facility [Line Items] | ||
Uncommitted financing arrangement | $ 125,000,000 | |
Line of credit expiration date | Feb. 15, 2017 | |
Temporary Increase To Line Of Credit [Member] | PNC Bank, N.A. [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum uncommitted financing arrangement | $ 550,000,000 | |
Maximum uncommitted financing arrangement expiration period | 45 days | |
Frequency of temporary increases | 4 | |
Temporary Increase To Line Of Credit [Member] | Huntington Bank [Member] | ||
Line of Credit Facility [Line Items] | ||
Maximum uncommitted financing arrangement | $ 150,000,000 | |
Maximum uncommitted financing arrangement expiration period | 30 days | |
Frequency of temporary increases | 3 |
Lease Commitments - Additional
Lease Commitments - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Operating Leased Assets [Line Items] | ||||
Total rental expense | $ 3 | $ 2.7 | $ 8.6 | $ 7.4 |
Lease expiration date | 2,019 | |||
Maximum [Member] | ||||
Operating Leased Assets [Line Items] | ||||
Operating lease terms | 11 years | |||
Reduced operating lease terms | 7 years | |||
Minimum [Member] | ||||
Operating Leased Assets [Line Items] | ||||
Operating lease terms | 3 years | |||
Reduced operating lease terms | 2 years |
Lease Commitments - Summary of
Lease Commitments - Summary of Future Minimum Rental Payments (Detail) $ in Thousands | Sep. 30, 2016USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
Remainder of 2016 | $ 2,250 |
2,017 | 10,231 |
2,018 | 9,860 |
2,019 | 8,951 |
2,020 | 8,116 |
2,021 | 6,696 |
Thereafter | 12,283 |
Total rental payment due, net | $ 58,387 |
Servicing - Additional Informat
Servicing - Additional Information (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Transfers and Servicing [Abstract] | ||
Unpaid principal balance of servicing portfolio of commercial real estate loan | $ 55,200 | $ 48,700 |
Funds held in escrow | $ 212.7 | $ 177.5 |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Tax Expense Includes Current and Deferred Taxes (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | ||||
Current Federal Tax | $ 14,897 | $ 20,157 | ||
State Current Tax | 2,925 | 3,627 | ||
Federal and State Current Total | 17,822 | 23,784 | ||
Federal Deferred Tax | 13,528 | 9,577 | ||
State Deferred Tax | 546 | 2,717 | ||
Federal and State Deferred Total | 14,074 | 12,294 | ||
Federal Current and Deferred Total | 28,425 | 29,734 | ||
State Current and Deferred Total | 3,471 | 6,344 | ||
Income tax expense | $ 12,260 | $ 13,638 | $ 31,896 | $ 36,078 |
Income Taxes - Summary of Inc52
Income Taxes - Summary of Income Tax Expense Allocation (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | ||||
Taxes computed at federal rate | $ 28,573 | $ 30,071 | ||
State and local taxes, net of federal tax benefit | 3,288 | 3,261 | ||
Effect of deferred tax rate change | (1,188) | 2,621 | ||
Change in income tax benefit payable to stockholder | 206 | (451) | ||
Provision to return adjustment | 196 | (130) | ||
Meals and entertainment | 789 | 693 | ||
Other | 32 | 13 | ||
Income tax expense | $ 12,260 | $ 13,638 | $ 31,896 | $ 36,078 |
Taxes computed at federal rate, Percentage | 35.00% | 35.00% | ||
State and local taxes, net of federal tax benefit, Percentage | 4.00% | 3.80% | ||
Effect of deferred tax rate change, Percentage | (1.50%) | 3.10% | ||
Change in income tax benefit payable to stockholder, Percentage | 0.30% | (0.50%) | ||
Provision to return adjustment, Percentage | 0.20% | (0.20%) | ||
Meals and entertainment, Percentage | 1.00% | 0.80% | ||
Other, Percentage | 0.00% | 0.00% | ||
Income tax expense, Total Percentage | 39.10% | 42.00% |
Income Taxes - Summary of Defer
Income Taxes - Summary of Deferred Income Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Deferred income tax assets: | ||
Section 754 election tax basis step-up | $ 120,806 | $ 129,862 |
Tenant improvements | 3,456 | 3,118 |
Restricted stock units | 7,286 | 6,229 |
Compensation | (160) | 4,267 |
Intangible asset | 399 | 425 |
Other | 627 | 465 |
Deferred income tax asset | 132,414 | 144,366 |
Deferred income tax liabilities: | ||
Goodwill | (1,272) | (1,262) |
Servicing rights | (13,860) | (10,827) |
Deferred rent | (1,683) | (1,822) |
Investment in partnership | (582) | (578) |
Deferred income tax liability | (17,397) | (14,489) |
Net deferred income tax asset | $ 115,017 | $ 129,877 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Schedule Of Income Taxes [Line Items] | ||||
Deferred annual pre-tax benefit | $ 120,800,000 | $ 120,800,000 | ||
Operating loss carried back date | 2 years | |||
Operating loss carried forward date | 20 years | |||
Assumed revenue generated in each year | $ 305,000,000 | |||
Deferred anticipated pre-tax benefit | 34,600,000 | 34,600,000 | ||
Interest or penalties | 0 | $ 0 | 0 | $ 0 |
Future tax benefits | 120,800,000 | $ 120,800,000 | ||
Increase in deferred tax assets, percentage | 85.00% | |||
Increase in deferred tax assets additional paid-in capital in stockholders equity , percentage | 15.00% | |||
Company estimated payments made to HFF Holdings | 111,400,000 | $ 111,400,000 | ||
Tax benefit relating to the Section 754 basis step-up | (12,260,000) | (13,638,000) | (31,896,000) | (36,078,000) |
Payments under the tax receivable agreement | $ 10,824,000 | $ 10,822,000 | ||
HFF Holdings [Member] | ||||
Schedule Of Income Taxes [Line Items] | ||||
Amount of cash savings to HFF holdings | 85.00% | 85.00% | ||
Tax benefit relating to the Section 754 basis step-up | $ 12,700,000 | |||
Payments under the tax receivable agreement | 10,800,000 | $ 10,800,000 | ||
Term of tax receivable agreement in aggregate amount paid | 74,200,000 | $ 74,200,000 | ||
Anticipated amount to be paid under tax receivable agreement to HFF Holdings 2017 | 11,300,000 | 11,300,000 | ||
Federal [Member] | ||||
Schedule Of Income Taxes [Line Items] | ||||
Net operating loss carry forwards | $ 0 | $ 0 | ||
Amount of cash savings to HFF holdings | 85.00% | |||
State and Local Income Tax [Member] | ||||
Schedule Of Income Taxes [Line Items] | ||||
Amount of cash savings to HFF holdings | 85.00% |
Stockholders Equity - Additiona
Stockholders Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Feb. 19, 2016 | Feb. 08, 2016 | Jan. 22, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 |
Class of Stock [Line Items] | ||||||
Aggregate dividend paid | $ 68,362 | $ 67,821 | ||||
Class A Common Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares authorized | 175,000,000 | 175,000,000 | ||||
Common stock, par value | $ 0.01 | $ 0.01 | ||||
Voting rights per common stock | 1 | |||||
Common stock, shares issued | 38,463,448 | 38,351,367 | ||||
Class A Common Stock [Member] | Restricted Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Restricted stock granted for unvested and vested but not issued | 82,536 | |||||
Class A Common Stock [Member] | HFF Holdings [Member] | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares issued | 38,463,448 | 38,351,367 | ||||
Special cash dividend | $ 1.80 | |||||
Dividends payable, date of record | Feb. 8, 2016 | |||||
Dividends payable, declaration date | Jan. 22, 2016 | |||||
Dividends payable, payment date | Feb. 19, 2016 | |||||
Aggregate dividend paid | $ 68,400 |
Earning Per Share - Summary of
Earning Per Share - Summary of Net Income and Weighted Average Shares Outstanding (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 20,020 | $ 19,256 | $ 49,742 | $ 49,839 |
Weighted Average Shares Outstanding: | ||||
Basic | 38,273,684 | 38,001,399 | 38,234,868 | 37,963,954 |
Diluted | 38,958,377 | 38,554,028 | 38,764,829 | 38,394,930 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Restricted Stock [Member] | ||||
Earnings Per Share [Line Items] | ||||
Stock units and stock options included in weighted average shares | 189,385 | 165,732 | 189,385 | 165,732 |
Stock Options [Member] | ||||
Earnings Per Share [Line Items] | ||||
Stock units and stock options included in weighted average shares | 0 | 0 | 0 | 0 |
Earnings Per Share - Summary of
Earnings Per Share - Summary of Calculations of Basic and Diluted Net Income per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Numerator: | ||||
Net income | $ 20,020 | $ 19,256 | $ 49,742 | $ 49,839 |
Denominator: | ||||
Basic weighted average number of shares of Class A common stock | 38,273,684 | 38,001,399 | 38,234,868 | 37,963,954 |
Add-dilutive effect of: | ||||
Weighted average common shares outstanding-diluted | 38,958,377 | 38,554,028 | 38,764,829 | 38,394,930 |
Basic net income per share of Class A common stock | $ 0.52 | $ 0.51 | $ 1.30 | $ 1.31 |
Diluted earnings per share of Class A common stock | $ 0.51 | $ 0.50 | $ 1.28 | $ 1.30 |
Basic Earnings Per Share of Class A Common Stock [Member] | Class A Common Stock [Member] | ||||
Numerator: | ||||
Net income | $ 20,020 | $ 19,256 | $ 49,742 | $ 49,839 |
Denominator: | ||||
Basic weighted average number of shares of Class A common stock | 38,273,684 | 38,001,399 | 38,234,868 | 37,963,954 |
Add-dilutive effect of: | ||||
Basic net income per share of Class A common stock | $ 0.52 | $ 0.51 | $ 1.30 | $ 1.31 |
Diluted Earnings Per Share of Class A Common Stock [Member] | Class A Common Stock [Member] | ||||
Numerator: | ||||
Net income | $ 20,020 | $ 19,256 | $ 49,742 | $ 49,839 |
Denominator: | ||||
Basic weighted average number of shares of Class A common stock | 38,273,684 | 38,001,399 | 38,234,868 | 37,963,954 |
Add-dilutive effect of: | ||||
Unvested restricted stock units | 672,888 | 530,758 | 518,127 | 408,786 |
Stock options | 11,805 | 21,871 | 11,834 | 22,190 |
Weighted average common shares outstanding-diluted | 38,958,377 | 38,554,028 | 38,764,829 | 38,394,930 |
Diluted earnings per share of Class A common stock | $ 0.51 | $ 0.50 | $ 1.28 | $ 1.30 |
Earnings Per Share - Summary 59
Earnings Per Share - Summary of Calculations of Basic and Diluted Net Income per Share (Parenthetical) (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Restricted Stock [Member] | ||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||
Stock units and stock options included in weighted average shares | 189,385 | 165,732 | 189,385 | 165,732 |
Stock Options [Member] | ||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||
Stock units and stock options included in weighted average shares | 0 | 0 | 0 | 0 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Related Party Transaction [Line Items] | ||||
Payments under the tax receivable agreement | $ 10,824 | $ 10,822 | ||
Percentage of retained cash savings in income tax | 15.00% | 15.00% | ||
HFF Holdings [Member] | ||||
Related Party Transaction [Line Items] | ||||
Percentage of tax receivable agreement | 85.00% | |||
Payments under the tax receivable agreement | $ 10,800 | $ 10,800 | ||
Chief Executive Officer [Member] | ||||
Related Party Transaction [Line Items] | ||||
Payments under the tax receivable agreement | 800 | 900 | ||
Gibson [Member] | ||||
Related Party Transaction [Line Items] | ||||
Payments under the tax receivable agreement | 800 | 800 | ||
Thornton [Member] | ||||
Related Party Transaction [Line Items] | ||||
Payments under the tax receivable agreement | 700 | 700 | ||
Fowler [Member] | ||||
Related Party Transaction [Line Items] | ||||
Payments under the tax receivable agreement | 200 | 200 | ||
Lawton [Member] | ||||
Related Party Transaction [Line Items] | ||||
Payments under the tax receivable agreement | 400 | 400 | ||
Sansosti [Member] | ||||
Related Party Transaction [Line Items] | ||||
Payments under the tax receivable agreement | 200 | 200 | ||
Tepedino and de Zarraga [Member] | ||||
Related Party Transaction [Line Items] | ||||
Payments under the tax receivable agreement | $ 200 | $ 200 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Summary Of Commitments And Contingent Liabilities [Line Items] | ||||
Liability to HFF Holdings | $ 17,397,000 | $ 14,489,000 | ||
Accrued additional compensation to newly hired transaction professionals | $ 0 | 5,800,000 | ||
Additional compensation paid to newly hired transaction professionals | $ 5,800,000 | |||
Federal [Member] | ||||
Summary Of Commitments And Contingent Liabilities [Line Items] | ||||
Amount of cash savings to HFF holdings | 85.00% | |||
State and Local Income Tax [Member] | ||||
Summary Of Commitments And Contingent Liabilities [Line Items] | ||||
Amount of cash savings to HFF holdings | 85.00% | |||
Minimum [Member] | ||||
Summary Of Commitments And Contingent Liabilities [Line Items] | ||||
Payments under compensation arrangement, Period | 2,016 | |||
Maximum [Member] | ||||
Summary Of Commitments And Contingent Liabilities [Line Items] | ||||
Payments under compensation arrangement, Period | 2,019 | |||
HFF Holdings [Member] | ||||
Summary Of Commitments And Contingent Liabilities [Line Items] | ||||
Amount of cash savings to HFF holdings | 85.00% | 85.00% | ||
Liability to HFF Holdings | $ 111,400,000 | $ 121,200,000 |