Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Mar. 02, 2015 | Jun. 30, 2014 |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | MMI | ||
Entity Registrant Name | Marcus & Millichap, Inc. | ||
Entity Central Index Key | 1578732 | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 37,072,155 | ||
Entity Public Float | $204.10 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $149,159 | $100,952 |
Commissions receivable | 3,412 | 3,238 |
Employee notes receivable | 216 | 229 |
Prepaid expenses | 7,536 | 4,320 |
Income tax receivable | 1,711 | |
Deferred tax assets, net | 13,600 | 8,663 |
Other assets, net | 2,839 | 2,429 |
Total current assets | 178,473 | 119,831 |
Prepaid rent | 3,645 | 4,999 |
Property and equipment, net | 7,693 | 8,560 |
Employee notes receivable | 162 | 189 |
Marketable securities, available for sale | 14,752 | |
Investments held in rabbi trust | 4,332 | 4,067 |
Deferred tax assets, net | 21,265 | 27,185 |
Other assets | 3,282 | 2,478 |
Total assets | 233,604 | 167,309 |
Current liabilities: | ||
Accounts payable and accrued expenses | 9,488 | 6,911 |
Accounts payable and accrued expenses - related party | 97 | 506 |
Income tax payable | 6,459 | |
Notes payable to former stockholders | 894 | 851 |
Commissions payable | 28,932 | 25,086 |
Accrued bonuses and other employee related expenses | 27,793 | 16,947 |
Total current liabilities | 67,204 | 56,760 |
Deferred compensation and commissions | 36,581 | 32,177 |
Notes payable to former stockholders | 10,610 | 11,504 |
Other liabilities | 2,400 | 4,371 |
Total liabilities | 116,795 | 104,812 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.0001 par value: Authorized shares - 25,000,000; issued and outstanding shares - none at December 31, 2014 and 2013, respectively | ||
Common Stock $0.0001 par value: Authorized shares - 150,000,000; issued and outstanding shares - 36,918,442 and 36,600,897 at December 31, 2014 and 2013, respectively | 4 | 4 |
Additional paid-in capital | 75,058 | 70,445 |
Stock notes receivable from employees | -4 | -13 |
Retained earnings (accumulated deficit) | 41,592 | -7,939 |
Accumulated other comprehensive income | 159 | |
Total stockholders' equity | 116,809 | 62,497 |
Total liabilities and stockholders' equity | $233,604 | $167,309 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 36,918,442 | 36,600,897 |
Common stock, shares outstanding | 36,918,442 | 36,600,897 |
Consolidated_Statements_of_Net
Consolidated Statements of Net and Comprehensive Income (USD $) | 12 Months Ended | ||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||
Revenues: | |||||
Real estate brokerage commissions | $524,951 | $393,203 | $351,407 | ||
Financing fees | 33,881 | 25,921 | 21,132 | ||
Other revenues | 13,356 | 16,771 | 13,177 | ||
Total revenues | 572,188 | 435,895 | 385,716 | ||
Operating expenses: | |||||
Cost of services | 350,102 | 264,637 | 230,248 | ||
Selling, general, and administrative expense | 134,274 | 115,661 | 103,479 | ||
Depreciation and amortization expense | 3,206 | 3,043 | 2,981 | ||
Stock-based and other compensation in connection with initial public offering | 31,268 | ||||
Total operating expenses | 487,582 | 414,609 | 336,708 | ||
Operating income | 84,606 | 21,286 | 49,008 | ||
Other income (expense), net | 28 | 760 | 437 | ||
Interest expense | -1,651 | -105 | -4 | ||
Income before provision for income taxes | 82,983 | 21,941 | 49,441 | ||
Provision for income taxes | 33,452 | 13,735 | 21,507 | ||
Net income | 49,531 | 8,206 | 27,934 | ||
Other comprehensive income: | |||||
Unrealized gain on marketable securities, net of tax of $16, $0 and $0 for the years ended December 31, 2014, 2013 and 2012, respectively | 24 | ||||
Foreign currency translation gain, net of tax of $90, $0 and $0 for the years ended December 31, 2014, 2013 and 2012, respectively | 135 | ||||
Total other comprehensive income | 159 | ||||
Comprehensive income | 49,690 | 8,206 | 27,934 | ||
Net income attributable to Marcus & Millichap, Inc. subsequent to initial public offering: | |||||
Net income | 49,531 | 8,206 | 27,934 | ||
Less: Net (loss) income attributable to Marcus & Millichap Real Estate Investment Services, Inc. prior to initial public offering on October 31, 2013 | -1,045 | 27,934 | |||
Net income attributable to Marcus & Millichap, Inc. subsequent to initial public offering | $49,531 | $9,251 | |||
Earnings per share | |||||
Basic | $1.27 | [1] | $0.24 | [1] | |
Diluted | $1.27 | [1] | $0.24 | [1] | |
Weighted average common shares outstanding | |||||
Basic | 38,851 | [1] | 38,787 | [1] | |
Diluted | 38,978 | [1] | 38,815 | [1] | |
[1] | Earnings per share (EPS) for the twelve months ended December 31, 2013 represents EPS attributable to Marcus & Millichap, Inc. subsequent to its initial public offering on October 31, 2013. EPS information for periods prior to the initial public offering were not meaningful. |
Consolidated_Statements_of_Net1
Consolidated Statements of Net and Comprehensive Income (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Statement [Abstract] | |||
Unrealized gain on marketable securities, tax | $16 | $0 | $0 |
Foreign currency translation gain, tax | $90 | $0 | $0 |
Consolidated_Statement_of_Stoc
Consolidated Statement of Stockholders' Equity (USD $) | Total | Series A Redeemable Preferred Stock [Member] | Common Stock [Member] | Additional Paid-In Capital [Member] | Stock Notes Receivable From Employees [Member] | Retained Earnings (Accumulated Deficit) [Member] | Accumulated Other Comprehensive Income [Member] |
In Thousands, except Share data | |||||||
Beginning Balance at Dec. 31, 2011 | $20,157 | $10 | $230 | $20,423 | ($146) | ($360) | |
Beginning Balance, Shares at Dec. 31, 2011 | 1,000 | 230,239 | |||||
Net and comprehensive income | 27,934 | ||||||
Net income (loss) attributable to Marcus & Millichap Real Estate Investment Services, Inc. prior to initial public offering on October 31, 2013 | 27,934 | ||||||
Net income | 27,934 | 27,934 | |||||
Series A preferred dividends declared and paid | -30,756 | -30,756 | |||||
Deemed capital contribution (distribution) from MMC | 4,209 | 4,209 | |||||
Issuance of restricted stock | 4 | 86 | -90 | ||||
Issuance of restricted stock, Shares | 3,500 | ||||||
Payments on stock notes receivable from employees | 86 | 86 | |||||
Ending Balance at Dec. 31, 2012 | 21,630 | 10 | 234 | 24,718 | -150 | -3,182 | |
Ending Balance, Shares at Dec. 31, 2012 | 1,000 | 233,739 | |||||
Net income (loss) attributable to Marcus & Millichap Real Estate Investment Services, Inc. prior to initial public offering on October 31, 2013 | -1,045 | -1,045 | |||||
Series A preferred dividends declared and paid | -37,681 | -24,718 | -12,963 | ||||
Deemed capital contribution (distribution) from MMC | -3,291 | -3,291 | |||||
Issuance of restricted stock | 1 | 20 | -21 | ||||
Issuance of restricted stock, Shares | 750 | ||||||
Stock-based compensation, Shares | 69,583 | ||||||
Payments on stock notes receivable from employees | 158 | 158 | |||||
Stock-based compensation | 30,886 | 30,886 | |||||
Exchange of Marcus & Millichap Real Estate Investment Services, Inc. Series A redeemable preferred and common stock for Marcus & Millichap, Inc. common stock | -10 | -231 | 241 | ||||
Exchange of Marcus & Millichap Real Estate Investment Services, Inc. Series A redeemable preferred and common stock for Marcus & Millichap, Inc. common stock, Shares | -1,000 | 32,123,412 | |||||
Issuance of common stock, net of issuance costs | 42,313 | 42,313 | |||||
Issuance of common stock, net of issuance costs, Shares | 4,173,413 | ||||||
Ending Balance at Oct. 31, 2013 | 52,970 | 4 | 70,169 | -13 | -17,190 | ||
Ending Balance, Shares at Oct. 31, 2013 | 36,600,897 | ||||||
Net income attributable to Marcus & Millichap, Inc. subsequent to initial public offering | 9,251 | 9,251 | |||||
Stock-based compensation | 276 | 276 | |||||
Ending Balance at Dec. 31, 2013 | 62,497 | 4 | 70,445 | -13 | -7,939 | ||
Beginning Balance, Shares at Dec. 31, 2013 | 36,600,897 | ||||||
Net and comprehensive income | 49,690 | ||||||
Net income attributable to Marcus & Millichap, Inc. subsequent to initial public offering | 49,531 | ||||||
Net income | 49,531 | 49,531 | |||||
Total other comprehensive income (loss) | 159 | 159 | |||||
Issuance of common stock for settlement of deferred stock units | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Issuance of common stock for settlement of deferred stock units, Shares | 455,151 | ||||||
Shares withheld related to net share settlement of deferred stock units | -5,981 | -5,981 | |||||
Shares withheld related to net share settlement of deferred stock units, Shares | -185,821 | ||||||
Issuance of common stock pursuant to employee stock purchase plan | 410 | 410 | |||||
Issuance of common stock pursuant to employee stock purchase plan, Shares | 25,331 | ||||||
Issuance of unvested restricted stock awards | 22,884 | ||||||
Stock-based compensation | 5,034 | 5,034 | |||||
Tax benefit from stock-based award activity | 4,310 | 4,310 | |||||
Tax benefit of deductible IPO transaction costs | 840 | 840 | |||||
Payments on stock notes receivable from employees | 9 | 9 | |||||
Ending Balance at Dec. 31, 2014 | $116,809 | $4 | $75,058 | ($4) | $41,592 | $159 | |
Ending Balance, Shares at Dec. 31, 2014 | 36,918,442 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities | |||
Net income | $49,531 | $8,206 | $27,934 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization expense | 3,206 | 3,043 | 2,981 |
Provision for bad debt expense | 29 | 207 | 97 |
Stock-based compensation | 5,034 | 33,817 | 4,209 |
Deferred taxes, net | 877 | -9,276 | |
Other non-cash items | 372 | 66 | 19 |
Changes in operating assets and liabilities: | |||
Commissions receivable | -174 | 1,969 | -3,297 |
Prepaid expenses | -3,216 | -1,414 | -547 |
Prepaid rent | 1,354 | -2,144 | 103 |
Investments held in rabbi trust | -48 | -1,162 | -497 |
Other assets | -1,243 | -595 | 172 |
Due to (from) affiliates | 60,389 | -19,884 | |
Accounts payable and accrued expenses | 2,711 | -8,043 | 6,791 |
Accounts payable and accrued expenses - related party | -409 | 506 | |
Income tax (receivable) payable | -3,860 | 6,459 | |
Commissions payable | 3,846 | 2,502 | 9,008 |
Accrued bonuses and other employee related expenses | 10,846 | -572 | 7,831 |
Deferred compensation and commissions | 4,536 | 3,086 | 2,495 |
Other liabilities | -1,955 | -100 | -2,061 |
Net cash provided by operating activities | 71,437 | 96,944 | 35,354 |
Cash flows from investing activities | |||
Purchases of marketable securities, available for sale | -14,700 | ||
Payments received on employee notes receivable | 126 | 1,173 | 458 |
Issuances of employee notes receivable | -86 | -434 | -706 |
Purchase of property and equipment | -2,566 | -4,795 | -4,563 |
Proceeds from sale of property and equipment | 1 | 32 | 174 |
Net cash (used in) investing activities | -17,225 | -4,024 | -4,637 |
Cash flows from financing activities | |||
Proceeds from issuance of shares pursuant to employee stock purchase plan | 410 | ||
Withholding taxes paid related to net share settlement of equity awards | -5,982 | ||
Realized tax benefit of deductible IPO transaction costs | 840 | ||
Distribution related to stock appreciation rights liability | -412 | ||
Dividends paid to Marcus & Millichap Company | -37,681 | -30,756 | |
Payments on obligations under capital leases | -16 | -58 | -98 |
Principal payments on notes payable to former stockholders | -851 | ||
Payments received on stock notes receivable from employees | 6 | 158 | 86 |
Proceeds from initial public offering, net of issuance costs | 42,506 | ||
Net cash (used in) provided by financing activities | -6,005 | 4,925 | -30,768 |
Net increase (decrease) in cash and cash equivalents | 48,207 | 97,845 | -51 |
Cash and cash equivalents at beginning of period | 100,952 | 3,107 | 3,158 |
Cash and cash equivalents at end of period | 149,159 | 100,952 | 3,107 |
Supplemental disclosures of cash flow information | |||
Interest paid during the period | 635 | 1 | 4 |
Income taxes paid (paid to former parent in 2013 and 2012) | 35,596 | 29,702 | 17,880 |
Supplemental disclosures of noncash investing and financing activities | |||
Tax benefit from share-based award activity included in income tax (receivable)payable | 4,310 | ||
Deferred offering costs included in accounts payable and accrued expenses | 193 | ||
Net change in accounts payable and accrued expenses related to property and equipment additions | -134 | 216 | |
Issuance of restricted stock for notes receivable | 21 | 90 | |
Deemed capital (distribution) contribution from Marcus & Millichap Company | ($3,291) | $4,209 |
Description_of_Business_Basis_
Description of Business, Basis of presentation and Recent Accounting Pronouncements | 12 Months Ended | |
Dec. 31, 2014 | ||
Accounting Policies [Abstract] | ||
Description of Business, Basis of presentation and Recent Accounting Pronouncements | 1 | Description of Business, Basis of presentation and Recent Accounting Pronouncements |
Description of Business | ||
Marcus & Millichap, Inc., (the “Company”, “Marcus & Millichap”, or “MMI”), a Delaware corporation, is a brokerage firm specializing in commercial real estate investment sales, financing, research and advisory services. As of December 31, 2014, MMI operates 78 offices in the United States and Canada through its wholly-owned subsidiary, Marcus & Millichap Real Estate Investment Services, Inc. (“MMREIS”), which includes the operations of Marcus & Millichap Capital Corporation (“MMCC”). | ||
Reorganization and Initial Public Offering | ||
MMI was formed in June 2013 in preparation for Marcus & Millichap Company (“MMC”) to spin-off its majority owned subsidiary, MMREIS (“Spin-Off”). Prior to the initial public offering (“IPO”) of MMI stock on October 30, 2013, all of the preferred and common stockholders of MMREIS (including MMC and employees of MMREIS) contributed all of their outstanding shares to MMI, in exchange for new MMI common stock. As a result, MMREIS became a wholly-owned subsidiary of MMI. Thereafter, MMC distributed 80.0% of the shares of MMI common stock to MMC’s shareholders and exchanged the remaining portion of its shares of MMI common stock for cancellation of indebtedness of MMC. | ||
On November 5, 2013, MMI completed its Initial Public Offering (“IPO”) of 6,900,000 shares of common stock at a price to the public of $12.00 per share of which 4,173,413 shares were sold by the Company and 2,726,587 shares were sold by certain selling stockholders. See Note 9 – “Stockholders’ Equity” for additional information on IPO. | ||
Basis of Presentation | ||
The Company’s consolidated financial statements have been prepared in accordance with US generally accepted accounting principles (“GAAP”). Prior to the Spin-Off, MMI and MMREIS were affiliates under common control and in connection with the Spin-Off, the assets and liabilities of MMREIS were recorded at carryover basis. The historical financial statements of MMREIS, as the Company’s predecessor, have been presented as the historical financial statements of MMI for all periods prior to the Spin-Off from the beginning of the earliest period presented. | ||
Consolidation | ||
The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. | ||
Use of Estimates | ||
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. | ||
Concentration of Credit Risk | ||
Financial instruments that potentially subject the Company to a concentration of credit risk principally consist of cash and cash equivalents, due from affiliates, due from independent contractors, investments in marketable securities – available for sale, security deposits (included under other assets, non-current caption) and commissions receivables. Cash is placed with high-credit quality financial institutions and invested high-credit quality money market funds. | ||
To reduce its credit risk, the Company monitors the credit standing of the financial institutions that hold the Company’s cash and cash equivalents. The Company historically has not experienced any losses related to cash and cash equivalents or due from affiliates. The Company derives its revenues from a broad range of real estate investors, owners, and users in the United States and Canada, none of which individually represents a significant concentration of credit risk. The Company performs ongoing credit evaluations of its customers and debtors and requires collateral on a case-by-case basis. The Company maintains allowances, as needed, for estimated credit losses based on management’s assessment of the likelihood of collection. For the twelve months ended December 31, 2014 and 2013, no transaction represented 10% or more of total revenues. Further, while one or more transactions may represent 10% or more of commissions receivable at any reporting date, amounts due are typically collected within 10 days of settlement and therefore do not expose the Company to significant credit risk. | ||
Reclassifications | ||
Certain prior-period amounts in the consolidated financial statements and notes thereto, have been reclassified to conform to the current period presentation. These changes had no impact on the previously reported consolidated results of operations, total assets, total liabilities, stockholders’ equity or cash flow subtotals. In addition to reclassifications within current assets, the Company reclassified $668,000, net in due from independent contractors from other assets long-term to current as of December 31, 2013. | ||
Segment Reporting | ||
The Company follows the guidance for segment reporting, which requires reporting information on operating segments in interim and annual financial statements. An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses whose separate financial information is available and is evaluated regularly by the Chief Operating Decision Maker (“CODM”) or decision making group, to perform resource allocations and performance assessments. The CODMs are the Chief Executive Officer and Chief Financial Officer. The CODM review financial information presented on an office-by-office basis for purposes of making operating decisions, assessing financial performance and allocating resources. Based on the evaluation of the Company’s financial information, management believes that the Company’s offices represent individual operating segments with similar economic characteristics that meet the criteria for aggregation into a single reportable segment for financial reporting purposes. The Company’s financing operations also represent an individual operating segment, which does not meet the thresholds to be presented as a separate reportable segment. | ||
Recent Accounting Pronouncements | ||
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which supersedes virtually all of the current revenue recognition guidance under U.S. GAAP, and requires entities to recognize revenue for transfer to customer of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. ASU 2014-09 is effective for reporting periods beginning after December 15, 2016 and early adoption is not permitted. ASU 2014-09 permits two implementation approaches, one requiring retrospective application of the new standard with restatement of prior years and one requiring prospective application of the new standard with disclosure of results under old standards. For the Company, the new standard will be effective January 1, 2017. The Company is currently evaluating the impact of this new standard and will select a transition method when the effect is determined; however, the Company does not expect this standard to have a significant effect on the Company’s revenue recognition. | ||
In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”). Currently, there is no guidance under U.S. GAAP regarding management’s responsibility to assess whether there is substantial doubt about an entity’s ability to continue as a going concern. Under ASU 2014-15, the Company will be required to assess its ability to continue as a going concern each interim and annual reporting period and provide certain disclosures if there is substantial doubt about the entity’s ability to continue as a going concern, including management’s plan to alleviate the substantial doubt. ASU 2014-15 is effective for reporting periods beginning after December 15, 2016 and early adoption is permitted. For the Company, the new standard will be effective January 1, 2017. This new standard will not have an impact on the Company’s consolidated financial position or results of operations. |
Accounting_Policies
Accounting Policies | 12 Months Ended | |
Dec. 31, 2014 | ||
Accounting Policies [Abstract] | ||
Accounting Policies | 2 | Accounting Policies |
Cash and Cash Equivalents | ||
The Company considers cash and cash equivalents to include short-term, highly liquid investments with maturities of three months or less when purchased. At December 31, 2014 and 2013, a significant portion of the balance of cash and cash equivalents was principally held with three financial institutions and one money market fund. Management believes the likelihood of realizing material losses from the excess of cash balances over federally insured limits is remote. | ||
Prior to June 30, 2013, the majority of the cash generated and used in the Company’s operations was held in bank accounts with one financial institution that were included in a sweep arrangement with MMC. Pursuant to a treasury management service agreement with that financial institution, the cash was swept daily into MMC’s money market account. The Company collected interest income from MMC at the same interest rate as MMC earned on the money market account. Historically, other than for a 2-week period around MMC’s March 31 fiscal year end, the Company had a receivable from MMC for the cash that was swept. When the sweep arrangement was not in effect, during the week before and the week after March 31, the Company’s cash balances remained in the Company’s bank accounts. As of June 30, 2013, the sweep arrangement with MMC was permanently terminated. | ||
Revenue Recognition | ||
The Company generates real estate brokerage commissions by acting as a broker for real estate owners or investors seeking to buy or sell commercial properties. Revenues from real estate brokerage commissions are recognized when there is persuasive evidence of an arrangement, all services have been provided, the price is fixed and determinable and collectability is reasonably assured. These criteria are typically met at the close of escrow. The Company generates financing fees from securing financing on purchase transactions as well as fees earned from refinancing its clients’ existing mortgage debt and other financing activities. Revenues from financing fees are recognized at the time the loan closes and there are no remaining significant obligations for performance in connection with the transaction. Other revenues include fees generated from consulting and advisory services, as well as referral fees from other real estate brokers. Revenues from these services are recognized as they are performed and completed. | ||
Commissions Receivable | ||
Commissions receivable consist of commissions earned on brokerage transactions for which payment has not yet been received. The Company evaluates the need for an allowance for doubtful accounts based on the specific-identification of potentially uncollectible accounts. The majority of commission’s receivable are settled within 10 days after the close of escrow. As a result, the Company did not require an allowance for commissions receivable at December 31, 2014 or 2013. | ||
Cost of Services | ||
Cost of services principally consists of commissions and other costs for the Company’s sales and financing professionals related to transactions closed in the period. Sales and financing professionals commissions are generally paid on transaction revenues and includes referral and other revenues generated by the Company’s sales and financing professionals. Sales and financing professionals are compensated at commission rates based on individual agreements and portions of the commissions due may be deferred in accordance with their contracts. | ||
Investments in Marketable Securities, Available for Sale | ||
The Company maintains a portfolio of cash equivalents and investments in a variety of fixed and variable rate securities, including U.S. government and agency debt securities, corporate debt securities, asset-backed securities and money market funds. The Company considers its investment in marketable securities to be available-for-sale. Accordingly, these investments are recorded at their fair values, with unrealized gains or losses recorded in other comprehensive income (loss), net of tax. The Company determines the appropriate classification of investments in marketable securities, available for sale at the time of purchase. Interest along with accretion and amortization of purchase premiums and discounts, which are recorded over the remaining weighted average life of the security, are included in other income (expense), net in the consolidated statements of net and comprehensive income. See Note 5 – “Investments in Marketable Securities” for additional information. | ||
The Company regularly reviews its investment portfolio to determine if any security is other-than-temporarily impaired, which would require the Company to record an impairment charge in the period any such determination is made. In making this judgment, the Company evaluates, among other items, the duration and extent to which the fair market value of a security is less than its amortized cost and the Company’s intent and ability to sell, or whether the Company will more likely than not be required to sell, the security before recovery of its amortized cost basis. The Company has evaluated its investments in marketable securities as of December 31, 2014 and has determined that no investments with unrealized losses are other-than-temporarily impaired. The Company has no current intent to sell and it is not more likely than not that the Company will be required to sell these investments before recovery of their amortized cost basis, which may be at maturity. | ||
Investments Held in Rabbi Trust | ||
The Company provides a non-qualified deferred compensation program to certain employees. Deferred amounts are contributed to a Rabbi Trust which invests the amounts in variable whole life insurance policies owned by the Company for the participants benefit. Participants may elect to invest in various equity and debt securities offered within the plan on a notional basis. The net change in the carrying value of the underlying assets held in the rabbit trust is recorded in other income (expense), net. The change in the deferred compensation liability as a result the change in the notional value of the participants accounts is recorded as a component of selling general and administrative expenses in the consolidated statements of net and comprehensive income. | ||
Fair Value of Financial Instruments | ||
The Company carries its investments including investments in marketable securities, available for sale and investments held in rabbi trust at fair value. The Company defines the fair value of a financial instrument as the amount that would be received from the sale of an asset in an orderly transaction between market participants at the measurement date. The Company is responsible for the determination of the value of the investment carried and fair value and the supporting methodologies and assumptions. The Company uses various pricing sources to validate the values utilized. | ||
The degree of judgment used in measuring the fair value of financial instruments generally inversely correlates with the level of observable valuation inputs. Financial instruments with quoted prices in active markets generally have more pricing observability and less judgment is used in measuring fair value. Financial instruments for which no quoted prices are available have less observability and are measured at fair value using valuation models or other pricing techniques that require more judgment. | ||
Assets recorded at fair value in the Consolidated Balance Sheets are measured and classified in accordance with a fair value hierarchy consisting of the three “levels” based on the observability of inputs available in the market place used to measure the fair values as discussed below: | ||
Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; | ||
Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability, or | ||
Level 3: Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. | ||
Financial Instruments Fair Value | ||
The Company’s cash and cash equivalents, commissions receivable, amounts due from employee and sales and financing professionals (included in other assets), accounts payable and accrued expenses and commissions payable are carried at cost, which approximates fair value based on their immediate or short-term maturities and terms, which approximate current market rates and considered to be in the Level 1 classification. | ||
Investment in marketable securities, available for sale and investments held in rabbi trust are carried at fair value based on observable inputs available. All these securities are measured as Levels 1 or 2 as appropriate. The Company has no investments measured as Level 3. | ||
As the Company’s obligations under notes payable to former stockholders bear fixed interest rates that approximate current interest rates for debt instruments with similar terms and maturities, the Company has determined that the carrying value on these instruments approximates fair value. As the Company’s obligations under SARs liability (included in deferred compensation and commission’s caption) bear interest at a variable rate based on U.S. Treasuries, the Company has determined that the carrying value approximates the fair value. These are considered to be in the Level 2 classification. | ||
Property and Equipment, Net | ||
Property and equipment are stated at cost less accumulated depreciation and amortization. The Company uses the straight-line method for depreciation and amortization. Depreciation and amortization are provided over estimated useful lives ranging from three to seven years. | ||
The Company occasionally leases certain equipment under capital lease arrangements. The assets and liabilities under capital leases are recorded at the lesser of the present value of aggregate future minimum lease payments, including estimated bargain purchase options, or the fair value of the asset under lease. Assets under capital leases are depreciated using the straight-line method over the lesser of the estimated useful life of the asset or the term of the lease. The Company does not have any remaining capital lease obligations as of December 31, 2014. | ||
The Company evaluates its fixed assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. | ||
Other Assets | ||
Other assets consist primarily of amounts due from the Company’s sales and financing professionals, security deposits made in connection with operating leases, customer trust accounts and other receivables. | ||
The Company, from time to time, advances funds to or on behalf of its sales and financing professionals. Certain amounts may bear a nominal interest rate, with any cash receipts on notes applied first to any unpaid principal balance prior to any income being recognized. The Company generally has the ability to collect a portion of these amounts from future commissions due to the sales and financing professional or may forgive a portion of the amount depending on the nature of the advance. The Company evaluates the need for an allowance for these amounts based on the specific identification of potentially uncollectible amounts and provides an allowance based on consideration of historical experience. Amounts are written off upon termination of the sales and financing professional as a service provider or when amounts are no longer collectable. | ||
In connection with a brokerage transaction, the Company may need to or be required to hold cash in escrow for a transaction participant. These amount are deposited into separate customer trust accounts controlled by the Company. The amounts are included in non-current other assets with a corresponding liability included in other liabilities, both in the Consolidated Balance Sheets. | ||
In connection with real estate brokerage activities, the Company may accept a portion of its commission in the form of a commission note receivable. In these cases, the Company considers the need for collateral and evaluates the need for an allowance for these amounts based on the specific identification of potentially uncollectible amounts and provides an allowance based on consideration of historical experience and facts specific to the transaction that gave rise to the commission notes receivable. | ||
Deferred Rent Obligation | ||
Some of the Company’s operating leases contain periods of free or reduced rent or contain predetermined fixed increases in the minimum rent amount during the lease term. For these leases, the Company recognizes rent expense on a straight-line basis over the term of the lease, including periods of free rent or reduced rent, and records the difference between the amount charged to rent expense and the rent paid as a deferred rent obligation. | ||
Advertising Costs | ||
Advertising costs are expensed as incurred. Advertising costs are included in selling, general, and administrative expense in the accompanying consolidated statements of net and comprehensive income. | ||
Advertising expense for the years ended December 31, 2014, 2013 and 2012 was $965,000, $975,000 and $702,000, respectively. | ||
Income Taxes | ||
The Company accounts for income taxes under the asset and liability method. The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to (1) differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and (2) operating loss and tax credit carryforwards. The Company measures existing deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which the Company expects to have temporary differences to be recovered or settled. The Company recognizes into income the effect on deferred tax assets and liabilities of a change in tax rates in the period that includes the enactment date. Valuation allowances are provided against deferred tax assets when it is more-likely-than-not that some portion or all of the deferred tax asset will not be realized. | ||
Because of the nature of the Company’s business, which includes activity in the U.S. and Canada, incorporating numerous states and provinces as well as local jurisdictions, the Company’s tax position can be complex. As such, the Company’s effective tax rate is subject to changes as a result of changes in the mix of its activity in the various jurisdictions in which the Company operates. | ||
The threshold for recognizing the benefits of tax return positions in the financial statements is “more likely than not” to be sustained by the taxing authority and requires measurement of a tax position meeting the more-likely-than-not criterion, based on the largest benefit that is more than 50% likely to be realized. The Company’s inventory of tax positions has been assessed with respect to all applicable income tax issues for all open tax years (in each respective jurisdiction), and has concluded that no uncertain tax positions are required to be recognized in the Company’s consolidated financial statements. | ||
The Company recognizes interest and penalties incurred as income tax expense. | ||
Prior to the IPO, the Company was part of a consolidated federal income tax return and various combined and consolidated state tax returns that were filed by its previous parent. The Company had a tax-sharing agreement whereby the Company provided for income taxes in its consolidated statements of income using an effective tax rate of 43.5%. In addition, all deferred tax assets and liabilities were recorded by its parent. As part of the Spin-Off, the Company’s tax sharing agreement with its former parent was terminated effective October 31, 2013 and the Company’s allocable net deferred tax assets were transferred to the Company. | ||
Stock-Based Compensation | ||
The Company follows the accounting guidance for share based payments which requires the measurement and recognition of compensation expense for all stock based awards made to employees, agents and directors. Awards are issued under the 2013 Omnibus Equity Incentive Plan (the “2013 Plan”) and 2013 Employee Stock Purchase Plan (“2013 ESPP Plan”). | ||
For awards made to the Company’s employees and directors, the Company initially values its restricted stock units and restricted stock awards based on the grant date closing price of the Company’s common stock. For awards with periodic vesting, the Company recognizes the related expense on a straight-line basis over the requisite service period for the entire award, subject to periodic adjustments to ensure that the cumulative amount of expense recognized through the end of any reporting period is at least equal to the portion of the grant date value of the award that has vested through that date. | ||
For awards made to independent contractors, which are the Company’s sales and financing professionals, the Company determined that the fair value of the award shall be measured based on the fair value of the equity instrument as it is more reliably measureable than the fair value of the consideration received. The Company uses the grant date as the performance commitment date, and the measurement date for these awards is the date the services are completed, which is the vesting date. As a result, the Company records stock-based compensation for these awards over the vesting period on a straight-line basis with periodic adjustments during the vesting period for changes in the fair value of the awards. | ||
For the above awards, the Company estimates forfeitures at the time of grant in order to estimate the amount of share-based payment awards ultimately expected to vest and adjusts the recorded expense accordingly. The Company calculates a separate forfeiture rate for its employees and non-employees awards. Forfeitures are required to be revised, if necessary, in subsequent periods. If estimated and actual forfeitures differ from these initial estimates, the Company adjusts the cumulative expense as appropriate to account for the change in the estimated forfeiture rates. If there are any modifications or cancellations of the underlying unvested share-based awards, the Company may be required to accelerate, increase or cancel any remaining unrecognized stock-based compensation expense. Stock-based compensation expense is included in general and administrative expense in the accompanying consolidated statements of net and comprehensive income. | ||
For awards issued under the 2013 ESPP Plan, the Company determined that the plan was a compensatory plan and is required to expense the fair value of the awards over each six-month offering period. The Company estimates the fair value of these awards using the Black-Scholes option pricing model. The Company calculates the expected volatility based on the historical volatility of the Company’s common stock and the risk-free interest rate based on the U.S. Treasury yield curve in effect at the time of grant, both consistent with the term of the offering period. The Company incorporates no forfeiture rate and includes no expected dividend yield as the Company has not, and currently does not intend to pay a regular dividend. See Note 9 – “Stockholders’ Equity” for additional information on dividends. | ||
Stock-Based Compensation Prior to the IPO | ||
MMREIS historically issued stock options and stock appreciation rights, or SARs, to key employees through a book value, stock-based compensation award program (the “Program”). The Program allowed for employees to exercise stock options in exchange for shares of unvested restricted common stock. The Program also allowed employees to exercise options through the issuance of notes receivable, which were recourse to the employee. The determination of the grant price and repurchase price of stock-based awards at the grant date and repurchase date were fixed as determined by a valuation formula using book value, as defined by the agreements between MMREIS and the employees. The stock awards generally vested over a three to five-year period. Under these plans, MMREIS retained the right to repurchase shares if certain events occurred, which included termination of employment. In these circumstances, the plan document provided for repurchase proceeds to be settled in the form of a note payable to (former) shareholders or cash, which was settled over a fixed period. While MMREIS had entered into the agreements to repurchase the stock and settle the SARs held by employees upon termination of their employment (subject to certain conditions as specified in the agreements), MMC had historically assumed the obligation to make payments to the former shareholders. While MMREIS recognized the compensation expense associated with these share-based payment arrangements, the liability had historically been assumed by MMC through a deemed contribution, which then has paid the former shareholders over time. The accounting for the stock options and SARs awards, including MMC’s assumption of MMREIS repurchase obligations, is discussed below. | ||
Restricted Common Stock | ||
Since stock options only allowed the grantee the right to acquire shares of unvested restricted common stock at book value, which was determined on an annual basis, MMREIS accounted for the stock options and the related unvested restricted stock, as a single instrument, with a single service period. The service period began on the option grant date, and extended through the exercise and subsequent vesting period of the restricted stock. The unvested restricted common stock was accounted for in accordance with ASC 718. Increases or decreases in the formula settlement value of unvested restricted stock subsequent to the grant date, were recorded as increases or decreases, respectively, to compensation expense, with decreases limited to the book value of the stock on the date of grant. As MMC had assumed the Company’s obligation with respect to any appreciation in the value of the underlying vested awards in excess of the employees’ exercise price, MMC was deemed to make a capital contribution to the Company’s additional paid-in capital equal to the amount of compensation expense recorded, net of the applicable taxes. Based on the tax-sharing agreement between the Company and MMC, the tax deduction for the compensation expense recorded by the Company was allocated to MMC. MMC recorded the liability related to the appreciation in the value of the underlying stock in its consolidated financial statements. To the extent of any depreciation in the value of the underlying vested awards (limited to the amount of any appreciation previously recorded from the employees ‘original exercise price), compensation expense was reduced and MMC was deemed to receive a capital distribution. | ||
SARs | ||
SARs to employees were accounted for in accordance with ASC 718. Similar to the vested stock, compensation expense related to the SARs was recorded in each period and was equal to the appreciation in the formula-settlement value of vested SARs at the end of each reporting period-end from the prior reporting period-end. As MMC had assumed the Company’s obligation with respect to any appreciation in the value of the vested SARs, MMC was deemed to make a capital contribution to the Company’s additional paid-in capital equal to the amount of compensation expense recorded, net of the applicable taxes. Based on the tax-sharing agreement entered between the Company and MMC, the tax deduction for the compensation expense recorded by the Company was allocated to MMC. MMC recorded the liability related to the appreciation in the value of the underlying stock in its consolidated financial statements. To the extent of any depreciation in the value of the vested SARs (limited to the amount of any appreciation previously recorded), compensation expense was reduced and MMC was deemed to have received a capital distribution. | ||
Earnings Per Share | ||
Earnings per share is calculated using net income attributable to Marcus and Millichap, Inc. subsequent to the IPO on October 31, 2013. Earnings per share prior to the IPO has not been presented as the holders of MMREIS Series A Redeemable Preferred Stock were entitled to receive discretionary dividends, payable in preference and priority to any distribution on MMREIS common stock. Since MMREIS typically distributed its earnings to the Series A Preferred stockholders on a quarter-in-arrears basis, earnings per share information for MMREIS common stock prior to the IPO was not meaningful. | ||
Basic weighted average shares outstanding includes vested, but un-issued Deferred Stock Units (“DSU’s). The difference between basic and weighted average shares outstanding and diluted weighted average shares outstanding represents the dilutive impact of common stock equivalents consisting of shares to be issued under the 2013 Plan and 2013 ESPP Plan. | ||
Foreign Currency Translation | ||
The Company prepares the financial statements of its Canadian subsidiary using the local currency as the functional currency. The assets and liabilities of the Company’s Canadian subsidiary are translated in to U.S. dollars at the rates of exchange at the balance sheet date with the resulting translation adjustments included as a separate component of stockholder’s equity through other comprehensive income (loss) in the consolidated statements of net and comprehensive income. | ||
Income and expenses are translated at the average monthly rates of exchange. The Company includes gains and losses from foreign currency transactions in other income (expense), net in the consolidated statements of net and comprehensive income. | ||
The effect of foreign currency translation on Cash and cash equivalent is reflected in cash flows from operating activities on the consolidated statements of cash flows, and is not material for any period presented. | ||
Taxes Collected From Clients and Remitted to Governmental Authorities | ||
The Company accounts for tax assessed by any governmental authority that is based on revenue or transaction value (i.e. sales, use and value added taxes) on a net basis, excluded from revenue and recorded as current liabilities until paid. |
Property_and_Equipment_Net
Property and Equipment, Net | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property, Plant and Equipment [Abstract] | |||||||||
Property and Equipment, Net | 3 | Property and Equipment, Net | |||||||
Property and equipment, net consist of the following (in thousands): | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Computer software and hardware equipment | $ | 8,769 | $ | 8,442 | |||||
Furniture, fixtures, and equipment | 14,684 | 19,530 | |||||||
Less accumulated depreciation and amortization | (15,760 | ) | (19,412 | ) | |||||
$ | 7,693 | $ | 8,560 | ||||||
During the year ended December 31, 2014, the Company wrote-off approximately $7.7 million of fully depreciated furniture, fixtures, and equipment no longer in use. | |||||||||
Depreciation and amortization expense on property and equipment was $3.2 million, $3.0 million and $3.0 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||
The cost and accumulated depreciation of assets subject to capital leases is recorded in furniture, fixtures and equipment and was not material as of December 31, 2013. The Company does not have any remaining capital lease obligations as of December 31, 2014. | |||||||||
Payments for certain improvements to the Company’s leased office space are recorded as prepaid rent. Amortization of prepaid rent is recorded using the straight-line method over the shorter of the estimated economic life of the improvements or lease term as a charge to rent expense. |
Selected_Balance_Sheet_Data
Selected Balance Sheet Data | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||
Selected Balance Sheet Data | 4 | Selected Balance Sheet Data | |||||||||||||||
Other Assets | |||||||||||||||||
Other assets consisted of the following (in thousands): | |||||||||||||||||
Current | Non-Current | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Due from independent contractors, net (1) (2) | $ | 1,577 | $ | 1,249 | $ | 1,820 | $ | 1,280 | |||||||||
Security deposits | — | — | 1,240 | 1,126 | |||||||||||||
Customer trust accounts and other | 1,262 | 1,180 | 222 | 72 | |||||||||||||
$ | 2,839 | $ | 2,429 | $ | 3,282 | $ | 2,478 | ||||||||||
(1) | Includes allowance for doubtful accounts related to current of $193,000 and $223,000 as of December 31, 2014 and 2013, respectively. The Company recorded a provision for bad debt expense of $29,000, $207,000 and $97,000 and wrote off $59,000, $152,000 and $173,000 of these receivables for the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||||||||||
(2) | Represents amounts advanced, notes receivable and other receivables due from the Company’s sales and financing professionals. The notes receivable along with interest, are typically collected from future commissions and are generally due in one to five years. As of December 31, 2014 and 2013, the weighted average interest rate for notes receivable due from the Company’s sales and financing professionals was approximately 2.8% and 2.2%, respectively. Any cash receipts on notes are applied first to unpaid principal balance prior to any income being recognized. | ||||||||||||||||
Deferred Compensation and Commissions | |||||||||||||||||
Deferred compensation and commissions consisted of the following (in thousands): | |||||||||||||||||
December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
SARs liability | $ | 20,542 | $ | 19,970 | |||||||||||||
Commissions payable to sales and financing professionals | 12,176 | 8,623 | |||||||||||||||
Deferred compensation liability | 3,863 | 3,584 | |||||||||||||||
$ | 36,581 | $ | 32,177 | ||||||||||||||
SARs Liability | |||||||||||||||||
Prior to the IPO, certain employees of the Company were granted stock appreciation rights (“SARs”) under a stock-based compensation program assumed by MMC. In connection with the IPO, the SARs agreements were revised, the MMC liability of $20.0 million for the SARs was frozen at March 31, 2013, and was transferred to MMI through a capital contribution. The SARs liability will be settled with each participant in installments upon retirement or departure. Under the revised agreements, MMI is required to accrue interest on the outstanding balance beginning on January 1, 2014 at a rate based on the 10-year treasury note plus 2%. The rate resets annually. The rate at January 2, 2014 was 5.03%, and MMI recorded interest expense related to this liability of $984,000 for the year ended December 31, 2014. During the year ended December 31, 2014, the Company reduced the SARs liability balance in the amount of $412,000 related to a distribution for the settlement of FICA taxes payable on behalf of certain participants. | |||||||||||||||||
Commissions Payable | |||||||||||||||||
Certain investment sales professionals have the ability to earn additional commissions after meeting certain annual revenue thresholds. These commissions are recognized as cost of services in the period in which they are earned. The Company has the ability to defer payment of certain commissions, at its election, for up to three years. Commissions payable that are not expected to be paid within twelve months are classified as long-term liabilities. | |||||||||||||||||
Deferred Compensation Liability | |||||||||||||||||
A select group of management is eligible to participate in a Deferred Compensation Plan. The plan is a 409A plan and permits the participant to defer compensation up to limits as determined by the plan. The Company elected to fund the Deferred Compensation Plan through company owned variable life insurance policies. The Deferred Compensation Plan is managed by a third-party institutional fund manager, and the deferred compensation and investment earnings are held as a Company asset in a rabbi trust, which is recorded in investments held in rabbi trust in the accompanying consolidated balance sheets. The assets in the trust are restricted unless the Company becomes insolvent, as defined in the Deferred Compensation Plan, in which case the trust assets are subject to the claims of MMI’s creditors. The Company may also, in its sole and absolute discretion, elect to withdraw at any time all or a portion of the trust assets by an amount by which the fair market value of the trust assets exceeds 110% of the aggregate amount in the Deferred Compensation Plan’s participants’ accounts. | |||||||||||||||||
The net change in the carrying value of the investments held in the rabbi trust are recorded in other income (expense), net in the consolidated statements of net and comprehensive income and were $290,000, $495,000 and $353,000 during the years ended December 31, 2014, 2013 and 2012, respectively. The net change in the carrying value of the deferred compensation obligation are recorded in selling, general, and administrative expense in the consolidated statements of net and comprehensive income and were $313,000, $504,000 and $353,000 during the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||||||||||
Other Liabilities | |||||||||||||||||
Other liabilities consisted of the following (in thousands): | |||||||||||||||||
December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Long term deferred rent | $ | 2,356 | $ | 2,952 | |||||||||||||
Accrued legal (1) | — | 1,351 | |||||||||||||||
Other | 44 | 68 | |||||||||||||||
$ | 2,400 | $ | 4,371 | ||||||||||||||
(1) | Excludes the current portion of accrued legal, which is included in accounts payable and accrued expenses on the consolidated balance sheets. |
Investments_in_Marketable_Secu
Investments in Marketable Securities | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||
Investments in Marketable Securities | 5 | Investments in Marketable Securities | |||||||||||||||
Amortized cost and fair value of marketable securities, available-for-sale, by type of security consisted of the following as of December 31, 2014 (in thousands): | |||||||||||||||||
Amortized | Gross | Gross | Fair | ||||||||||||||
Cost | Unrealized | Unrealized | Value | ||||||||||||||
Gains | Losses | ||||||||||||||||
Type of security – long-term: | |||||||||||||||||
U.S. government and agency debt securities | $ | 4,993 | $ | 7 | $ | (3 | ) | $ | 4,997 | ||||||||
Corporate debt securities | 7,442 | 48 | (12 | ) | 7,478 | ||||||||||||
Asset-backed securities | 2,277 | 4 | (4 | ) | 2,277 | ||||||||||||
$ | 14,712 | $ | 59 | $ | (19 | ) | $ | 14,752 | |||||||||
As of December 31, 2014, the amortized cost and fair value of the Company’s investment in available-for-sale securities that have been in a continuous unrealized loss position for less than 12 months were $5.4 million. Unrealized losses related to these investments are due to interest rate fluctuations as opposed to changes in credit quality. As of December 31, 2014, the Company did not have any investments in a continuous unrealized loss position for 12 months or longer. | |||||||||||||||||
In addition, the Company does not intend to sell and it is not more-likely-than-not that the Company would be required to sell these investments before recovery of their amortized cost basis, which may be at maturity. For the year-ended December 31, 2014, the Company did not sell any securities. As a result, there is no other-than-temporary impairment for these investments at December 31, 2014. Amortized cost and fair value of marketable securities, available-for-sale, by contractual maturity consisted of the following as of December 31, 2014 (in thousands): | |||||||||||||||||
Amortized | Fair | ||||||||||||||||
Cost | Value | ||||||||||||||||
Due in one year or less | $ | — | $ | — | |||||||||||||
Due after one year through five years | 4,679 | 4,679 | |||||||||||||||
Due after five years through ten years | 5,652 | 5,662 | |||||||||||||||
Due after ten years | 4,381 | 4,411 | |||||||||||||||
$ | 14,712 | $ | 14,752 | ||||||||||||||
Actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay certain obligations with or without call or prepayment penalties. | |||||||||||||||||
As of December 31, 2014, the weighted average maturity date of investments in marketable securities, available-for-sale securities was 9.6 years. |
Notes_Payable_to_Former_Stockh
Notes Payable to Former Stockholders | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Payables and Accruals [Abstract] | |||||
Notes Payable to Former Stockholders | 6 | Notes Payable to Former Stockholders | |||
In conjunction with the Spin-Off and IPO, notes payable to certain former stockholders of MMREIS that were issued in settlement of restricted stock and SARs awards that were redeemed by MMREIS upon the termination of employment by these former stockholders (“the Notes”), which had been previously assumed by MMC, were transferred to the Company. The Notes are unsecured and bear interest at 5% with annual principal and interest installments and a final principal payment in April 14, 2020 and June 30, 2020. Accrued interest pertaining to the Notes was $396,000 and $425,000 as of December 31, 2014 and 2013, respectively and was recorded in accounts payable and accrued expenses caption in the accompanying consolidated balance sheets. During the years ended December 31, 2014 and 2013, interest expense in the amount of $591,000 and $103,000, respectively was recorded in interest expense in the accompanying consolidated statements of net and comprehensive income. During the year ended December 31, 2013, accrued interest expense prior to the IPO date of October 31, 2013 in the amount of $318,000 was recorded in additional paid-in capital in the accompanying statements of stockholders’ equity. During the year ended December 31, 2014, the Company made payments of $1.5 million and of this amount, $851,000 pertained to principal and $618,000 pertained to interest. | |||||
As of December 31, 2014, the future minimum principal payments for the Notes for restricted stock and SARs were as follows (in thousands): | |||||
2015 | $ | 894 | |||
2016 | 939 | ||||
2017 | 985 | ||||
2018 | 1,035 | ||||
2019 | 1,087 | ||||
Thereafter | 6,564 | ||||
$ | 11,504 | ||||
RelatedParty_Transactions
Related-Party Transactions | 12 Months Ended | |
Dec. 31, 2014 | ||
Related Party Transactions [Abstract] | ||
Related-Party Transactions | 7 | Related-Party Transactions |
Shared and Transition Services | ||
Prior to October 2013, the Company operated under a shared services arrangement with MMC where by the Company was charged for actual costs specifically incurred on behalf of the Company or allocated to the Company on a pro rata basis. These costs included reimbursement for health insurance premiums, shared services and other general and administrative costs. The Company was charged $4.3 million (including $3.2 million for reimbursement for health insurance premiums) and $4.8 million (including $3.5 million for reimbursement for health insurance premiums) in the years ended December 31, 2013 and 2012, respectively under this arrangement. These amounts are included in selling, general and administrative expense in the accompanying consolidated statements of net and comprehensive income. | ||
Beginning in October 2013, certain services are provided to the Company under a Transition Services Agreement (“TSA”) between MMC and the Company, which replaced the pre-IPO shared services arrangement. The TSA is intended to provide certain services until the Company can acquire the services separately, and the Company expects that these charges will decrease over time. During the years ended December 31, 2014 and 2013, the Company incurred $1.3 million and $824,000 under the TSA of which $1.0 million and $687,000 was incurred for reimbursement of health insurance premiums. These amounts are included in selling, general and administrative expense in the accompanying consolidated statements of net and comprehensive income. In April 2014, the Company established its own health insurance plan significantly reducing the reliance on the TSA. As of December 31, 2014 and 2013, $97,000 and $506,000, respectively, remains unpaid and included in accounts payable and other accrued expenses – related party in the accompanying consolidated balance sheets. | ||
Brokerage and Financing Services with the Subsidiaries of MMC | ||
MMC has wholly or majority owned subsidiaries that buy and sell commercial real estate properties. The Company performs certain brokerage and financing services related to transactions of the subsidiaries of MMC. For the years ended December 31, 2014, 2013 and 2012, the Company recorded real estate brokerage commissions and financing fees of $1.3 million, $735,000 and $1.1 million, respectively, from subsidiaries of MMC related to these services. The Company incurred cost of services of $816,000, $441,000 and $711,000, respectively, related to these revenues. | ||
Operating Lease with MMC | ||
The Company has an operating lease with MMC for an office located in Palo Alto, California. The lease expires May 31, 2022. Rent expense for this lease totaled $438,000, $398,000 and $278,000 for the years ended December 31, 2014, 2013 and 2012, respectively, which is included in selling, general and administrative expense in the accompanying consolidated statements of net and comprehensive income. | ||
Other | ||
The Company, from time-to-time makes advances to non-executive employees. At December 31, 2014 and 2013, the aggregate principal amount for employee loans outstanding was $378,000 and $418,000, respectively, which is included in employee notes receivable in the accompanying consolidated balance sheets. | ||
See Note 9 – “Stockholders’ Equity” for information on pre-IPO dividends to MMC. | ||
As of December 31, 2014, Mr. Marcus, the Company’s founder and Co-Chairman, continues to beneficially own indirectly approximately 65% of the Company’s fully diluted shares, including shares to be issued upon settlement of vested deferred stock units, or DSUs. | ||
On February 6, 2015, the Company filed a Registration Statement on Form S-3, registering for future sale of 4,600,000 shares, principally controlled by Mr. Marcus. The Company cannot sell any shares under this Registration Statement. | ||
Prior to its termination on June 30, 2013, the Company was subject to a cash sweep arrangement with MMC. Under the arrangement, the Company’s cash was swept daily into an MMC money market account. The Company received interest on the balances held in the sweep accounts. The Company earned interest of $0, $74,000 and $147,000 on the balances for the years ended December 31, 2014, 2013 and 2012, respectively. |
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Fair Value Measurements | 8 | Fair Value Measurements | |||||||||||||||
The Company values its investments including investments held in rabbi trust, cash equivalents and investments in marketable securities, available for sale at fair value on a recurring basis. These investments carried at fair value are categorized into one of the three categories described above and consisted of the following (in thousands): | |||||||||||||||||
December 31, 2014 | |||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||
Investments held in rabbi trust | $ | 4,332 | $ | — | $ | 4,332 | $ | — | |||||||||
$ | 4,332 | $ | — | $ | 4,332 | $ | — | ||||||||||
Cash equivalents: | |||||||||||||||||
Money market funds (1): | $ | 25,310 | $ | 25,310 | — | — | |||||||||||
$ | 25,310 | $ | 25,310 | — | — | ||||||||||||
Marketable securities, available for sale | |||||||||||||||||
Long-term investments: | |||||||||||||||||
U.S. government and agency debt securities | $ | 4,997 | $ | 2,980 | $ | 2,017 | $ | — | |||||||||
Corporate debt securities | 7,478 | — | 7,478 | — | |||||||||||||
Asset-backed securities | 2,277 | — | 2,277 | — | |||||||||||||
$ | 14,752 | $ | 2,980 | $ | 11,772 | $ | — | ||||||||||
(1) | Included in cash and cash equivalents. | ||||||||||||||||
The fair value of investments held in rabbi trust categorized as level 2 was $4.1 million as of December 31, 2013. | |||||||||||||||||
See Note 2 – “Accounting Policies” for information on fair value of the Company’s other financial instruments. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Equity [Abstract] | |||||||||
Stockholders' Equity | 9 | Stockholders’ Equity | |||||||
Stockholders’ Equity Subsequent to the IPO | |||||||||
Common Stock | |||||||||
As of December 31, 2014 and 2013, there were 36,918,442 and 36,600,897 shares of common stock, $0.0001 par value, issued and outstanding, including 42,882 and 30,000 of unvested restricted stock awards issued to non-employee directors, respectively. | |||||||||
During the period subsequent to the IPO, the Company did not pay any dividends and currently does not intend to pay a regular dividend. The Company will evaluate its dividend policy in the future. Any declaration and payment of future dividends to holders of the Company’s common stock will be at the discretion of the board of directors and will depend on many factors, including the Company’s financial condition, earnings, cash flows, capital requirements, level of indebtedness, statutory and contractual restrictions applicable to the payment of dividends and other considerations that the board of directors deems relevant. | |||||||||
Preferred Stock | |||||||||
Subsequent to the IPO, the Company has 25,000,000 authorized shares of preferred stock with a par value $0.0001 per share. At December 31, 2014 and 2013, there were no preferred shares issued or outstanding. | |||||||||
Accumulated Other Comprehensive Income | |||||||||
The components of accumulated other comprehensive income, net of income taxes consists of the following (in thousands): | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Unrealized gain on marketable securities, net | $ | 24 | $ | — | |||||
Foreign currency translation gain, net | 135 | — | |||||||
$ | 159 | $ | — | ||||||
Stockholders’ Equity Prior to the IPO and Transactions in Connection with the IPO | |||||||||
Preferred Stock | |||||||||
Prior to the IPO, MMREIS had issued and outstanding 1,000 shares of Series A Redeemable Preferred Stock (“pre-IPO Series A Preferred”) and 234,489 shares of common stock. Terms of the pre-IPO Series A Preferred were as follows: | |||||||||
Liquidation Preference – In the event of voluntary or involuntary liquidation, the pre-IPO Series A Preferred stockholders were entitled to be paid, before any payment was to be made in respect of MMREIS’s common stock, an amount equal to $10 per share of pre-IPO Series A Preferred plus all accrued but unpaid dividends for each share of pre-IPO Series A Preferred. If, upon liquidation, the assets of MMREIS available for distribution to its stockholders were insufficient to pay the holders of pre-IPO Series A Preferred, the entire remaining assets of MMREIS available for distribution would have been distributed ratably among the holders of the pre-IPO Series A Preferred in proportion to the full amount to which they would have otherwise been respectively entitled. | |||||||||
After the payment or setting apart for payment to the holders of the pre-IPO Series A Preferred, the remaining assets and funds of MMREIS available for distribution to the stockholders would have been distributed among the holders of pre-IPO common stock pro rata on the basis of the number of shares of pre-IPO common stock then outstanding. | |||||||||
Redemption – MMREIS was permitted to redeem any or all shares of pre-IPO Series A Preferred by paying an amount equal to $10 per share plus all declared and unpaid dividends with respect to such shares at the redemption date. The pre-IPO Series A Preferred shares were not convertible into common stock. | |||||||||
Voting Rights – The pre-IPO Series A Preferred stockholders did not have voting rights. | |||||||||
Pre-IPO Spin-off | |||||||||
On October 30, 2013 and prior to completion of the Company’s IPO, MMC and the other stockholders of MMREIS contributed all of the 1,000 issued and outstanding shares of the pre-IPO Series A Preferred, $10.00 par value and 234,489 of the issued and outstanding shares of MMREIS common stock, $1.00 par value, in exchange for 32,357,901 shares of the new Marcus & Millichap common stock, $0.0001 par value. The 234,489 issued and outstanding shares of MMREIS common stock included 28,749 shares owned by MMREIS managing directors. | |||||||||
Initial Public Offering | |||||||||
On November 5, 2013, the Company completed its IPO of 6,900,000 shares of common stock at a price to the public of $12.00 per share. The Company sold 4,173,413 shares of common stock in the IPO, including 900,000 shares of common stock pursuant to the exercise of the underwriters’ option to purchase additional shares. Selling stockholders sold an aggregate of 2,726,587 shares in the IPO at the same price to the public. The Company did not receive any of the proceeds from the sale of such shares by the selling stockholders. The Company received proceeds from its IPO of $42.3 million, including the underwriters’ full exercise of their option to purchase additional shares and after deducting the underwriting discounts and commissions of $3.5 million and IPO related expenses of $4.3 million. | |||||||||
Dividends | |||||||||
Prior to the IPO, MMREIS distributed substantially all of its net income to MMC in the form of cash dividends. The stockholders of the pre-IPO Series A Preferred were entitled to receive dividends, payable in preference and priority to any distribution on common stock, at a rate determined by the Board of Directors, when and as declared by the Board of Directors. The right to dividends on the pre-IPO Series A Preferred was not cumulative, and no right accrued to the holders of the pre-IPO Series A Preferred by reason of the fact that dividends on such shares were not declared and paid in any prior year, nor are any undeclared or unpaid dividends entitled to bear or accrue interest. No dividends were paid with respect to common stock unless the pre-IPO Series A Preferred stockholders received a dividend return in such year in the amount of $10 for each outstanding share of the pre-IPO Series A Preferred. To the extent that dividends were declared on any common share, a dividend in an equal amount was to be paid on each outstanding share of pre-IPO Series A Preferred. | |||||||||
Total dividends declared and paid on the pre-IPO Series A Preferred shares for the twelve months ended December 31, 2013 and 2012 were $37.7 million and $30.8 million, respectively. No dividends were declared for pre-IPO common stock for the twelve months ended December 31, 2013 and 2012. | |||||||||
Deemed Capital Contribution (Distribution) from MMC | |||||||||
MMC accounted for stock-based compensation and was deemed to make a capital contribution to MMREIS’s additional paid-in capital equal to the amount of stock-based compensation expense attributable to MMREIS. The amounts recorded were net of the applicable taxes in accordance with the tax-sharing agreement between MMREIS and MMC, as the tax deduction on the compensation expense recorded by MMREIS was allocated to MMC. | |||||||||
In conjunction with the Spin-Off, IPO and the termination of the tax-sharing agreement between MMREIS and MMC, certain liabilities and legal obligations of MMREIS that had been previously assumed by MMC were transferred back to MMREIS as non-cash deemed contributions (distributions) from MMC. Such liabilities and legal obligations included (i) the assumption of a liability of $20.0 million related to amounts frozen under the SARs program based on a frozen value calculated as of March 31, 2013; (ii) the assumption of a liability of $12.2 million related to notes payable to certain former stockholders of MMREIS in settlement of SARs and restricted stock awards which were redeemed by MMREIS upon the termination of employment by these former stockholders; (iii) the assumption of a liability of approximately $318,000 related to interest payable associated with notes payable to former stockholders. See Note 6 – “Notes Payable to Former Stockholders” for additional information; and (iv) deferred tax assets, net totaling $26.6 million using an effective tax rate of 40.0% primarily pertaining to these and other items in connection with IPO. See Note 11 – “Income Taxes” for additional information. | |||||||||
A summary of the deemed capital contributions (distributions) from MMC recorded in additional paid in capital is as follows (in thousands): | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Compensation cost for unvested restricted stock and SARs, net of tax | $ | 2,655 | $ | 4,209 | |||||
SARs liability | (19,970 | ) | — | ||||||
Notes payable to former stockholders | (12,230 | ) | — | ||||||
Interest expense related to notes payable to former stockholders | (318 | ) | — | ||||||
Deferred taxes assets, net | 26,572 | — | |||||||
$ | (3,291 | ) | $ | 4,209 | |||||
StockBased_Compensation_Plans
Stock-Based Compensation Plans | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||
Stock-Based Compensation Plans | 10 | Stock-Based Compensation Plans | |||||||||||||||||||
2013 Omnibus Equity Incentive Plan | |||||||||||||||||||||
In October 2013, the board of directors adopted the 2013 Plan, which became effective upon the Company’s IPO. The 2013 Plan, in general, authorizes for the granting of incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock awards (RSAs), restricted stock units (RSUs), performance units and performance shares to the Company’s and subsidiary corporations’ employees, independent contractors, directors and consultants. Grants are made from time to time by the Company’s board of directors at its discretion. | |||||||||||||||||||||
The following limits apply to any awards granted under the 2013 Plan: | |||||||||||||||||||||
• | Options and stock appreciation rights – no employee or independent contractor can be granted, within any fiscal year, one or more options or stock appreciation rights, which in the aggregate cover more than 500,000 shares; provided, however, that in connection with an employee or independent contractor’s initial service as an employee or independent contractor, an employee or independent contractor’s aggregate limit may be increased by 1,000,000 shares; | ||||||||||||||||||||
• | Restricted stock and restricted stock units – no employee or independent contractor can be granted, within any fiscal year one or more awards of restricted stock or restricted stock units, which in the aggregate cover more than 500,000 shares; provided, however, that in connection with an employee or independent contractor’s initial service as an employee or independent contractor, an employee or independent contractor’s aggregate limit may be increased by 1,000,000 shares; and | ||||||||||||||||||||
• | Performance units and performance shares – no employee or independent contractor can receive performance units or performance shares having a grant date value (assuming maximum payout) greater than $2 million dollars or covering more than 500,000 shares, whichever is greater; provided, however, that in connection with an employee or independent contractor’s initial service as an employee or independent contractor, an employee or independent contractor may receive performance units or performance shares having a grant date value (assuming maximum payout) of up to an additional amount equal to $5 million dollars or covering up to 1,000,000 shares, whichever is greater. An individual may only have one award of performance units or performance shares for a performance period. | ||||||||||||||||||||
Upon adoption of the 2013 Plan, 5,500,000 shares of common stock were reserved for the issuance of awards under the 2013 Plan. At December 31, 2014, there were 2,193,063 shares available for future grants under the Plan. The number of shares available for issuance under the 2013 Plan increases annually on the first day of each year beginning with the 2015 fiscal year, by an amount equal to the lesser of: (i) 5,500,000 shares of the Company’s common stock; (ii) 3% of the outstanding shares of the Company’s common stock as of the last day of the immediately preceding fiscal year; and (iii) such other amount as the Company’s board of directors may determine. Pursuant to the automatic increase provided for in the 2013 Plan, the board of directors approved a share reserve increase of 1,100,000 shares in 2015. | |||||||||||||||||||||
Awards Granted in Connection with the IPO | |||||||||||||||||||||
In November 2013, MMI issued the following equity awards under the 2013 Plan: (i) DSUs for an aggregate of 2,192,413 shares granted as replacement awards related to the prior SARs program to the MMREIS managing directors, (ii) DSUs for 83,334 shares to be granted to the Company’s Co-chairman of the board of directors (Mr. Millichap). The DSU’s are fully vested and will be issued ratably over 5 years. In addition, 30,000 shares, in the form of RSAs, was granted to the Company’s non-employee directors. The shares vest ratably over 3 years. All the above awards were granted based on the IPO price of $12.00. | |||||||||||||||||||||
Awards Granted and Settled Subsequent to the IPO | |||||||||||||||||||||
Under the 2013 Plan, the Company has issued RSA’s to non-employee directors and RSU’s to employees and non-employee sales and financing professionals. All RSAs vest in equal annual installments over a three year period from the date of grant. All RSUs vest in equal annual installments over a five year period from the date of grant. Any unvested awards are canceled upon termination of service. As of December 31, 2014, there were no issued or outstanding options, stock appreciation rights, performance units or performance shares awards. | |||||||||||||||||||||
In November 2014, 455,151 shares of the vested DSUs were settled. 185,821 shares of common stock were withheld to pay applicable required employee statutory withholding taxes based on the market value of the shares on the settlement date. The amount remitted to the tax authorities for the employees’ tax obligation was reflected in the consolidated statements of cash flows. The shares withheld for taxes were returned to the share reserve and are available for future issuance under the 2013 Plan. | |||||||||||||||||||||
Outstanding Awards | |||||||||||||||||||||
The following table summarizes the Company’s activity under the 2013 Plan for the year ended December 31, 2014 (dollars in thousands, except per share data): | |||||||||||||||||||||
RSA Grants to Non- | RSU Grants to | RSU Grants to | Total | Weighted- | |||||||||||||||||
employee Directors | Employees | Independent | Average Grant | ||||||||||||||||||
Contractors | Date Fair Value | ||||||||||||||||||||
Per Share | |||||||||||||||||||||
Nonvested shares at December 31, 2013 | 30,000 | 313,155 | 570,760 | 913,915 | $ | 14.46 | |||||||||||||||
Granted | |||||||||||||||||||||
Feb-14 | — | — | 38,088 | 38,088 | |||||||||||||||||
May-14 | 22,884 | 6,991 | 31,780 | 61,655 | |||||||||||||||||
Aug-14 | — | 6,346 | 12,474 | 18,820 | |||||||||||||||||
Nov-14 | — | 9,584 | 4,638 | 14,222 | |||||||||||||||||
Dec-14 | — | 216,411 | — | 216,411 | |||||||||||||||||
Total Granted | 22,884 | 239,332 | 86,980 | 349,196 | 27.46 | ||||||||||||||||
Vested | (10,002 | ) | — | — | (10,002 | ) | 12 | ||||||||||||||
Transferred | — | (8,596 | ) | 8,596 | — | 14.54 | |||||||||||||||
Forfeited/canceled | — | (27,454 | ) | (18,646 | ) | (46,100 | ) | 14.65 | |||||||||||||
Nonvested shares at December 31, 2014 (1) | 42,882 | 516,437 | 647,690 | 1,207,009 | $ | 18.23 | |||||||||||||||
Unrecognized stock-based compensation expense as of December 31, 2014 (2) | $ | 503 | $ | 10,126 | $ | 16,546 | $ | 27,175 | |||||||||||||
Weighted average remaining vesting period (years) as of December 31, 2014 | 2.11 | 4.46 | 4.05 | 4.15 | |||||||||||||||||
(1) | Nonvested RSU’s will be settled through the issuance of new shares of common stock. | ||||||||||||||||||||
(2) | The total unrecognized compensation expense is expected to be recognized over a weighted-average period of approximately 4.15 years. | ||||||||||||||||||||
As of December 31, 2014, 1,820,596 fully vested DSUs s remained outstanding. See “Amendments to Restricted Stock and SARs” section below and Note 13 – “Earnings Per Share” for additional information. | |||||||||||||||||||||
Employee Stock Purchase Plan | |||||||||||||||||||||
In 2013, the Company adopted the 2013 Employee Stock Purchase Plan (“2013 ESPP Plan”). The 2013 ESPP Plan had 366,667 shares of common stock reserved and 341,356 shares of common stock available for issuance at December 31, 2014. The ESPP Plan provides for annual increases in the number of shares available for issuance under the ESPP on the first day of each fiscal year beginning with the 2015 fiscal year, equal to the least of (i) 366,667 shares, (ii) 1% of the outstanding shares on such date, or (iii) an amount determined by the Board. Pursuant to the automatic increase provided for in the 2013 ESPP Plan, the board of directors determined a share reserve increase was not needed in 2015. | |||||||||||||||||||||
The ESPP Plan qualifies under Section 423 of the IRS Code and provides for consecutive, nonoverlapping 6-month offering periods. The offering periods generally start on the first trading day on or after May 15 and November 15 of each year. The first offering period began on May 15, 2014. | |||||||||||||||||||||
The Company determined that the 2013 ESPP Plan was a compensatory plan and is required to expense the fair value of the awards over each 6-month offering period. The Company determines the fair value of ESPP shares to be acquired during each offering period using the Black Scholes option pricing model. The Company calculates the expected volatility based on the historical volatility of the Company’s common stock and the risk-free interest rate based on the U.S. Treasury yield curve in effect at the time of grant both consistent with the term of the offering period. The Company incorporates 0% forfeiture rate and 0% expected dividend yield as the Company has not subsequent to the IPO, and currently does not intend to pay regular dividends. | |||||||||||||||||||||
At December 31, 2014, total unrecognized compensation cost related to the ESPP Plan was $93,000 and is expected to be recognized over a weighted-average period of 0.37 years. | |||||||||||||||||||||
Stock Based Compensation Plans Prior to the IPO | |||||||||||||||||||||
Restricted Common Stock and SARs | |||||||||||||||||||||
MMREIS granted options and SARs under a stock-based compensation award program (“Program”). The granted options were exercisable into shares of unvested restricted pre-IPO common stock. The Program was administered by the board of directors. The board determined the terms of an award, including the amount, number of rights or shares, and vesting period, among others. Options issued generally had terms of one year or less. Restricted pre-IPO common stock issued upon exercise of stock options generally vested over three to five years, and were typically exercised immediately upon grant for a note receivable. The exercise price of the options was based upon a formula equivalent to the net book value of common stock as of the end of the fiscal year immediately preceding the date of issuance. | |||||||||||||||||||||
During the years ended December 31, 2013, 2012 and 2011 employees of MMREIS exercised stock options through the issuance of notes receivable. Cash payments on notes receivable were presented as an increase in consolidated stockholders’ equity. Such notes bore interest at a rate of 5% or 6% per annum and were due in defined installments on various remaining dates through April 15, 2016, which was consistent with the vesting periods of the restricted common stock. | |||||||||||||||||||||
There were no redemptions or cancelations of stock options during the years ended December 31, 2013 or 2012. | |||||||||||||||||||||
The following is a summary of MMREIS’s stock option activity: | |||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
Shares | Weighted- | Shares | Weighted- | ||||||||||||||||||
Under | Average | Under | Average | ||||||||||||||||||
Options | Exercise | Options | Exercise | ||||||||||||||||||
Price | Price | ||||||||||||||||||||
Options outstanding at beginning of year: | 750 | $ | 28.86 | 3,500 | $ | 25.67 | |||||||||||||||
Granted | — | — | 750 | 28.86 | |||||||||||||||||
Exercised | (750 | ) | 28.86 | (3,500 | ) | 25.67 | |||||||||||||||
Options outstanding at end of year | — | $ | — | 750 | $ | 28.86 | |||||||||||||||
The following is a summary of MMREIS’s restricted common stock activity: | |||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
Restricted | Weighted- | Restricted | Weighted- | ||||||||||||||||||
Stock | Average | Stock | Average | ||||||||||||||||||
Grant | Grant | ||||||||||||||||||||
Date Fair | Date Fair | ||||||||||||||||||||
Value | Value | ||||||||||||||||||||
Restricted common stock outstanding at beginning of year: | 27,999 | $ | 23.67 | 24,499 | $ | 23.36 | |||||||||||||||
Issued upon exercise of stock options | 750 | 28.86 | 3,500 | 25.87 | |||||||||||||||||
Exchange of common stock (1) | (28,749 | ) | — | — | — | ||||||||||||||||
Restricted common stock outstanding at end of year | — | $ | — | 27,999 | $ | 23.67 | |||||||||||||||
Restricted common stock vested at end of year | — | 22,682 | |||||||||||||||||||
Restricted common stock unvested at end of year | — | 5,317 | |||||||||||||||||||
(1) | Exchanged for new Marcus & Millichap stock prior to the IPO. Refer to Note 9 – “Stockholders’ Equity” for additional information on the exchange of common stock. | ||||||||||||||||||||
The following is a summary of MMREIS’s SARs activity: | |||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
SARs outstanding at beginning of period: | 28,733 | 27,983 | |||||||||||||||||||
Granted | — | 750 | |||||||||||||||||||
Settled (1) | (28,733 | ) | — | ||||||||||||||||||
SARs outstanding at end of period | — | 28,733 | |||||||||||||||||||
SARs vested at end of period | — | 22,666 | |||||||||||||||||||
(1) | Prior to the IPO, outstanding SAR’s were settled by exchanging the SAR’s for DSU’s for 2,192,413 shares of the new Marcus & Millichap common stock and a fixed SAR’s liability amount. SeeAmendments to Restricted Stock and SARs below. | ||||||||||||||||||||
Amendments to Restricted Stock and SARs | |||||||||||||||||||||
The SARs were frozen at the liability amount, calculated as of March 31, 2013, which will be paid out to each participant in installments upon retirement or departure under the terms of the revised SARs agreements. See Note 4 – “Selected Balance Sheet Data” for additional information. To replace beneficial ownership in the SARs, the difference between the book value liability and the fair value of the awards was granted to plan participants in the form of DSUs, which were fully vested upon receipt and will be settled in actual stock at a rate of 20% per year if the participant remains employed by the Company during that period (or otherwise all unsettled shares of stock upon termination of employment will be settled five years from the termination date). In addition, the formula settlement value of all outstanding shares of stock held by the plan participants was removed, and all such shares of stock are subject to sales restrictions that lapse at a rate of 20% per year for five years if the participant remains employed by the Company. Additionally, in the event of death or termination of employment after reaching the age of 67, 100% of the DSUs will be settled and 100% of the shares of stock will be released from the resale restriction. Further, 100% of the shares of stock will be released from the resale restriction upon the consummation of a change of control of the Company. | |||||||||||||||||||||
The modification was accounted for as a probable-to-probable modification in accordance with ASC 718. Total compensation cost recognized at the time of the modification was equal to (i) the unrecognized portion of compensation cost associated with the original awards, and (ii) the incremental cost resulting from the modification. The incremental compensation cost from the modification was the excess of (a) the fair value of the modified awards based upon the initial public offering price of the stock, and (b) the calculated value of the awards prior to the modification based upon the formula settlement value. The fair value of the DSUs was based upon the Company’s IPO price, discounted for the sales restrictions in accordance with ASC 718. The value of the discount was determined using an independent third-party valuation. In addition, as a result of the removal of the formula settlement value, the modification of the unvested restricted stock resulted in the awards being classified as equity awards. The modification, grant of replacement awards and acceleration of vesting of restricted stock and SARs and grants of other stock-based compensation awards in conjunction with the IPO pursuant to the 2013 Plan, resulted in non-cash stock-based compensation charges of $30.9 million during the three months ended December 31, 2013, which are included in stock-based and other compensation in connection with the IPO on the consolidated statements of net and comprehensive income. | |||||||||||||||||||||
Deemed Capital Contribution (Distribution) From MMC | |||||||||||||||||||||
MMC assumed MMREIS’s obligation with respect to any appreciation in the value of the underlying vested awards and SARs in excess of the employees’ exercise price. MMC was deemed to make a capital contribution to MMREIS’s additional paid-in capital equal to the amount of compensation expense recorded, net of the applicable taxes. Based on the tax-sharing agreement between MMREIS and MMC, the tax deduction on the compensation expense recorded by MMREIS was allocated to MMC. MMC recorded the liability related to the appreciation in the value of the underlying stock and SARs in its consolidated financial statements. To the extent of any depreciation in the value of the underlying vested awards and SARs (limited to the amount of any appreciation previously recorded from the employees’ original exercise price), compensation expense was reduced and MMC was deemed to receive a capital distribution. | |||||||||||||||||||||
The total compensation cost related to unvested stock and SARs was generally recognized over approximately four years. Restricted common stock issued upon exercise of stock options was generally vested over three to five years and stock options typically were exercised immediately for a note receivable. | |||||||||||||||||||||
In conjunction with the IPO, the vesting of all unvested restricted stock and all unvested SARs was accelerated. | |||||||||||||||||||||
Summary of Stock-Based Compensation | |||||||||||||||||||||
The following table summarizes the components of stock-based compensation included in the consolidated statements of net and comprehensive income (in thousands): | |||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Restricted stock and SARs (prior to IPO) | $ | — | $ | 4,679 | $ | 7,448 | |||||||||||||||
Stock based compensation in connection with IPO | — | 30,886 | — | ||||||||||||||||||
Employee stock purchase plan | 128 | — | — | ||||||||||||||||||
RSAs – non-employee directors | 197 | 20 | — | ||||||||||||||||||
RSUs – employees | 817 | 88 | — | ||||||||||||||||||
RSUs – independent contractors | 3,892 | 168 | — | ||||||||||||||||||
$ | 5,034 | $ | 35,841 | $ | 7,448 | ||||||||||||||||
RSUs granted to independent contractors are grants made to the Company’s sales and financing professionals, who are considered non-employees under ASC 718. Accordingly, such awards are required to be measured at fair value at the end of each reporting period until settlement. During the year ended December 31, 2014, stock-based compensation expense was impacted by an increase in the Company’s common stock price from $14.90 at December 31, 2013 to $33.25 at December 31, 2014. See Note 2 – “Accounting Policies” for additional information. |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Income Taxes | 11 | Income Taxes | |||||||||||
The provision for income taxes consists of the following (in thousands): | |||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Federal: | |||||||||||||
Current | $ | 28,452 | $ | 20,245 | $ | 18,866 | |||||||
Deferred | (566 | ) | (8,077 | ) | — | ||||||||
27,886 | 12,168 | 18,866 | |||||||||||
State: | |||||||||||||
Current | 4,123 | 2,522 | 2,641 | ||||||||||
Deferred | 1,443 | (1,199 | ) | — | |||||||||
5,566 | 1,323 | 2,641 | |||||||||||
Foreign: | |||||||||||||
Current | — | 244 | — | ||||||||||
Deferred | — | — | — | ||||||||||
244 | |||||||||||||
Provision for income taxes | $ | 33,452 | $ | 13,735 | $ | 21,507 | |||||||
Significant components of the Company’s deferred tax assets (liabilities), net are as follows (in thousands): | |||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Deferred Tax Assets, Net | |||||||||||||
Current: | |||||||||||||
Accrued expenses and bonuses | $ | 5,435 | $ | 5,668 | |||||||||
Bad debt and other reserves | 2,009 | 1,290 | |||||||||||
Deferred compensation | 2,796 | 2,325 | |||||||||||
Stock compensation | 4,205 | 369 | |||||||||||
Deferred rent | 324 | 335 | |||||||||||
Prepaid expenses | (1,392 | ) | (915 | ) | |||||||||
State taxes | 250 | (389 | ) | ||||||||||
Current deferred tax assets, net before valuation allowance | 13,627 | 8,683 | |||||||||||
Valuation allowance | (27 | ) | (20 | ) | |||||||||
Current deferred tax assets, net | $ | 13,600 | $ | 8,663 | |||||||||
Non-current: | |||||||||||||
Fixed assets and leasehold improvements | $ | 203 | $ | 427 | |||||||||
Litigation reserve | — | 887 | |||||||||||
Deferred compensation | 6,076 | 6,396 | |||||||||||
Stock compensation | 15,502 | 19,151 | |||||||||||
Deferred Rent | 997 | 1,259 | |||||||||||
Other comprehensive income | (113 | ) | — | ||||||||||
Unrealized gain on foreign currency | 56 | — | |||||||||||
Net operating loss carryforwards | 680 | 1,544 | |||||||||||
State taxes | (1,435 | ) | (2,213 | ) | |||||||||
Non-current deferred tax assets, net before valuation allowance | 21,966 | 27,451 | |||||||||||
Valuation allowance | (701 | ) | (266 | ) | |||||||||
Non-Current deferred tax assets, net | $ | 21,265 | $ | 27,185 | |||||||||
As of December 31, 2014, the Company had state and Canadian net operating losses (“NOLs”) of approximately $3.5 million, which will begin to expire in 2019. Certain limitations may be placed on NOLs as a result of “changes in control” as defined in Section 382 of the Internal Revenue Code. In the event a change in control occurs, it will have the effect of limiting the annual usage of the carryforwards in future years. Additional changes in control in future periods could result in further limitations of the Company’s ability to offset taxable income. In addition, the utilization of these NOLs may be subject to certain limitations under state and foreign laws. | |||||||||||||
A valuation allowance is required when it is more-likely-than not that all or a portion of a deferred tax asset will not be realized. Realization of deferred tax asset is dependent upon taxable income in prior carryback years, estimates of future taxable income, tax planning strategies and reversals of existing taxable temporary differences. Management determined that as of December 31, 2014 and 2013, $728,000 and $286,000, respectively, of the deferred tax assets related to state and Canadian NOLs do not satisfy the recognition criteria and therefore have recorded a valuation allowance for this amount. The valuation allowance for deferred tax assets was increased by $442,000 during 2014 and primarily related to the Company’s Canadian operations. | |||||||||||||
The provision for income taxes differs from the amount computed by applying the statutory federal corporate income tax rate of 35% to income before provision for income taxes as a result of the following (in thousands): | |||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Income tax expense at the federal statutory rate of 35% | $ | 29,044 | $ | 7,679 | $ | 17,305 | |||||||
State income tax expenses, net of federal benefit | 3,622 | 985 | 2,423 | ||||||||||
Permanent difference related to compensation charges | 163 | 3,445 | — | ||||||||||
Other | 181 | 361 | 8 | ||||||||||
Change in valuation allowance | 442 | — | — | ||||||||||
Differences due to tax-sharing agreement | — | 1,265 | 1,771 | ||||||||||
Provision for income taxes | $ | 33,452 | $ | 13,735 | $ | 21,507 | |||||||
During the year ended December 31, 2014, the Company recorded $6.9 million, as a reduction to income tax payable, primarily in connection with the settlement of DSUs/RSAs and IPO transaction costs, of which, $5.2 million, was credited directly to additional paid-in capital in the Stockholders’ equity section of the accompanying consolidated balance sheets. | |||||||||||||
As of December 31, 2014 and 2013, the Company has no liabilities for unrecognized tax benefits. At December 31, 2014 and 2013, the Company had not recognized any interest or penalties in the consolidated statements of net and comprehensive income or balance sheets. | |||||||||||||
The Company is subject to tax in various jurisdictions and, as a matter or ordinary course, the Company is subject to income tax examinations by the federal, state and foreign taxing authorities for the tax years 2009 to 2014. The Company is not currently under income tax examination by any taxing authorities. | |||||||||||||
The Company has not provided for U.S. taxes on undistributed earnings of its foreign subsidiary as it is operating at a loss and has no earnings and profits to remit. | |||||||||||||
Prior to the IPO, the Company was part of a consolidated federal income tax return and various combined and consolidated state tax returns that were filed by its former parent. The Company had a tax-sharing agreement whereby the Company provided for income taxes in its consolidated statements of net and comprehensive income using an effective tax rate of 43.5%. In addition, all deferred tax assets and liabilities were recorded by its former parent. As part of the Spin-Off, the Company’s tax sharing agreement with its former parent was terminated effective October 31, 2013. As a result the tax provision for the period November 1, 2013 through December 31, 2013 is calculated under the asset and liability method. Prior to November 1, 2013, all deferred tax assets and liabilities were recorded by MMC. On October 31, 2013, all deferred tax assets and liabilities allocable to the Company aggregating $26.6 million previously recorded by MMC were transferred to the Company. See Note 9 – “Stockholders’ Equity” for additional information. |
Retirement_Plans
Retirement Plans | 12 Months Ended | |
Dec. 31, 2014 | ||
Compensation and Retirement Disclosure [Abstract] | ||
Retirement Plans | 12 | Retirement Plans |
Effective January 2014, the Company has its own defined contribution plan (the “Contribution Plan”) under Section 401(k) of the Internal Revenue Code (prior to January 2014 the Contribution Plan provided by MMC), for all eligible employees who have completed one month of service and have reached age 21. The Contribution Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended. Participants may contribute up to 100% of their annual eligible compensation, subject to IRS limitation and ERISA. The Company makes matching contributions equal to the lower of 50% of the contributions or 4% of the employee’s compensation, up to a maximum of $4,000 per eligible employee per year. Company matching contributions aggregated $429,000 and $321,000 for the years ended December 31, 2014 and 2013, respectively. No matching contributions were made during the year ended December 31, 2012. |
Earnings_Per_Share
Earnings Per Share | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Earnings Per Share [Abstract] | |||||||||
Earnings Per Share | 13 | Earnings Per Share | |||||||
Earnings per share information has not been presented for periods prior to the IPO on October 31, 2013. See Note 2 – “Accounting Policies” for additional information. | |||||||||
The following table sets forth the computation of basic and diluted earnings per share subsequent to the IPO for the year ended December 31, 2014 and the period from October 31, 2013 through December 31, 2013 (in thousands, except per share data): | |||||||||
Year Ended | Period from | ||||||||
December 31, 2014 | October 31, 2013 | ||||||||
through December | |||||||||
31, 2013 | |||||||||
Numerator (Basic and Diluted): | |||||||||
Net income attributable to Marcus & Millichap, Inc. | $ | $49,531 | $ | 9,251 | |||||
Denominator: | |||||||||
Basic | |||||||||
Weighted average common shares issued and outstanding | 36,660 | 36,541 | |||||||
Deduct: Unvested RSAs (1) | (43 | ) | (30 | ) | |||||
Add: Fully vested DSUs (2) | 2,234 | 2,276 | |||||||
Weighted Average Common Shares Outstanding | 38,851 | 38,787 | |||||||
Basic earnings per common share | $ | 1.27 | $ | 0.24 | |||||
Diluted | |||||||||
Weighted Average Common Shares Outstanding from above | 38,851 | 38,787 | |||||||
Add: Dilutive effect of RSUs, RSAs & ESPP | 127 | 28 | |||||||
Weighted Average Common Shares Outstanding | 38,978 | 38,815 | |||||||
Diluted earnings per common share | $ | 1.27 | $ | 0.24 | |||||
(1) | RSAs were issued and outstanding to the non-employee directors and have a three year vesting term subject to service requirements. See Note 10 – “Stock-Based Compensation Plans” for additional information. | ||||||||
(2) | DSUs shares are included in weighted average common shares outstanding as the DSUs were fully vested upon receipt. See Note 10 – “Stock-Based Compensation Plans” for additional information. | ||||||||
RSUs totaling 817,000 shares and 0 shares, primarily pertaining to grants to the Company’s independent contractors, were excluded from the calculation of diluted earnings per common share for the year ended December 31, 2014 and 2013, respectively, as the effects were antidilutive. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments and Contingencies Disclosure [Abstract] | |||||
Commitments and Contingencies | 14 | Commitments and Contingencies | |||
Operating Leases | |||||
As of December 31, 2014, the future minimum lease payments under non-cancelable operating leases for office facilities and automobiles with terms in excess of one year are as follows (in thousands): | |||||
2015 | $ | 13,144 | |||
2016 | 10,198 | ||||
2017 | 7,535 | ||||
2018 | 5,995 | ||||
2019 | 3,338 | ||||
Thereafter | 5,658 | ||||
$ | 45,868 | ||||
As of December 31, 2014 and 2013, deferred rent totaled $3.1 million and $3.7 million, respectively, and is included in other liabilities and accounts payable and accrued expenses in the accompanying consolidated balance sheets. Rental expense was $16.7 million, $15.7 million and $14.5 million for the years ended December 31, 2014, 2013 and 2012, respectively. Rental expense is included in selling, general, and administrative expense in the accompanying consolidated statements of net and comprehensive income. | |||||
Certain facility leases provide for rental escalations related to increases in the lessors’ direct operating expenses. | |||||
The Company subleases certain office space to subtenants. The rental income received from these subleases is included as a reduction of rental expense and was not material for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||
Credit Agreement | |||||
On June 18, 2014, the Company entered into a Credit Agreement with Wells Fargo Bank, National Association (“Bank”), dated as of June 1, 2014 (the “Credit Agreement”). The Credit Agreement provides for a $60.0 million principal amount senior secured revolving credit facility that is guaranteed by all of the Company’s domestic subsidiaries (the “Credit Facility”), which matures on June 1, 2017. The Company may borrow, repay and reborrow amounts under the Credit Facility until its maturity date, at which time all amounts outstanding under the Credit Facility must be repaid in full. In connection with executing the Credit Agreement, the Company paid bank fees and other expenses in the aggregate amount of $224,000, which are being amortized over the term of the Credit Agreement. The Company must pay a commitment fee of up to 0.1% per annum, payable quarterly commencing on July 1, 2014, based on the amount of unutilized commitments under the Credit Facility. The amortization and commitment fee is included in interest expense in the accompanying consolidated statements of net and comprehensive income and was $76,000 during the year ended December 31, 2014. As of December 31, 2014, there were no amounts outstanding under the Credit Agreement. | |||||
Borrowings under the Credit Agreement are available for general corporate purposes and working capital. The Credit Facility includes a $10.0 million sublimit for the issuance of standby letters of credit. Borrowings under the Credit Facility will bear interest, at the Company’s option, at either the (i) Base Rate (defined as the highest of (a) the Bank’s prime rate, (b) the Federal Funds Rate plus 1.5% and (c) one-month LIBOR plus 1.5%), or (ii) at a variable rate between 0.875% and 1.125% above LIBOR, based upon the total funded debt to EBITDA ratio. | |||||
The Credit Facility contains customary covenants, including financial and other covenants reporting requirements and events of default. Financial covenants require the Company, on a combined basis with its guarantors, to maintain (i) an EBITDAR Coverage Ratio (as defined in the Credit Agreement) of not less than 1.25:1.0 as of each quarter end on a rolling 4-quarter basis and (ii) total funded debt to EBITDA not greater than 2.0:1.0 as of each quarter end on a rolling 4-quarter basis. The Credit Facility is secured by substantially all assets of the Company, including pledges of 100% of the stock or other equity interest of each subsidiary except for the capital stock of a controlled foreign corporation (as defined in the Internal Revenue Code). As of December 31, 2014, the Company was in compliance with all financial and non-financial covenants. | |||||
Litigation | |||||
The Company is subject to various legal proceeding and clams that arise in the ordinary course of business, some of which involve claims for damages that are substantial in amount. Most of these litigation matters are covered by insurance which contain deductibles, exclusions, claim limits and aggregate policy limits. While the ultimate liability for these legal proceeding cannot be determined, the Company reviews the need for its accrual for loss contingencies quarterly and records an accrual for litigation related losses where the likelihood of loss is both probable and estimable. The Company believes that the ultimate resolution of the legal proceedings will not have a material adverse effect on its financial condition or results of operations. The Company accrues legal fees for litigation as the legal services are provided. |
Selected_Quarterly_Financial_D
Selected Quarterly Financial Data | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Selected Quarterly Financial Data | 15 | Selected Quarterly Financial Data (Unaudited) | |||||||||||||||||||||||||||||||
The Company’s real estate brokerage commissions and financing fees are seasonal, which can affect an investor’s ability to compare the Company’s financial condition and results of operation on a quarter-by-quarter basis. Historically, this seasonality has caused the Company’s revenue, operating income, net income and cash flows from operating activities to be lower in the first half of the year and higher in the second half of the year, particularly in the fourth quarter. The concentration of earnings and cash flows in the last six months of the year, particularly in the fourth quarter, is due to an industry-wide focus of clients to complete transactions towards the end of the calendar year. In addition, the Company’s gross margins are typically lower during the second half of each year due to its commission structure for some of its senior sales and financing professionals. These senior sales and financing professionals are on a graduated commission schedule that resets annually in which higher commissions are paid for higher sales volumes. | |||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
Dec. 31 | Sep. 30 | Jun. 30 | Mar. 31 | Dec. 31 | Sep. 30 | Jun. 30 | Mar. 31 | ||||||||||||||||||||||||||
2014 | 2014 | 2014 | 2014 | 2013 (1) | 2013 | 2013 | 2013 | ||||||||||||||||||||||||||
(in thousands, except per share data) | |||||||||||||||||||||||||||||||||
Consolidated Financial Statement Data: | |||||||||||||||||||||||||||||||||
Total revenues | $ | 172,444 | $ | 150,889 | $ | 134,265 | $ | 114,590 | $ | 149,101 | $ | 111,953 | $ | 105,471 | $ | 69,370 | |||||||||||||||||
Cost of services | 109,836 | 92,269 | 79,601 | 68,396 | 94,242 | 67,718 | 61,456 | 41,221 | |||||||||||||||||||||||||
Operating income (loss) | 27,097 | 23,721 | 21,726 | 12,062 | (8,165 | ) | 12,625 | 14,169 | 2,657 | ||||||||||||||||||||||||
Net income (loss) | 16,430 | 13,523 | 12,796 | 6,782 | (8,716 | ) | 7,275 | 8,009 | 1,638 | ||||||||||||||||||||||||
Net (loss) income (attributable to MMREIS prior to IPO on October 31, 2013) | — | — | — | — | (17,967 | ) | 7,275 | 8,009 | 1,638 | ||||||||||||||||||||||||
Net income attributable to Marcus & Millichap, Inc. subsequent to IPO on October 31, 2013 | $ | 16,430 | $ | 13,523 | $ | 12,796 | $ | 6,782 | $ | 9,251 | $ | — | $ | — | $ | — | |||||||||||||||||
Earnings per share (2): | |||||||||||||||||||||||||||||||||
Basic | $ | 0.42 | $ | 0.35 | $ | 0.33 | $ | 0.17 | $ | 0.24 | |||||||||||||||||||||||
Diluted | $ | 0.42 | $ | 0.35 | $ | 0.33 | $ | 0.17 | $ | 0.24 | |||||||||||||||||||||||
(1) | The three months ended December 31, 2013 include non-cash stock-based and other compensation charges of $31.3 million. See Note 10 – “Stock-Based Compensation Plans” for additional information. | ||||||||||||||||||||||||||||||||
(2) | Earnings per share information are presented for periods subsequent to the IPO on October 31, 2013. See Note 13 – “Earnings Per Share” for additional information. |
Description_of_Business_Basis_1
Description of Business, Basis of presentation and Recent Accounting Pronouncements (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Reorganization and Initial Public Offering | Reorganization and Initial Public Offering |
MMI was formed in June 2013 in preparation for Marcus & Millichap Company (“MMC”) to spin-off its majority owned subsidiary, MMREIS (“Spin-Off”). Prior to the initial public offering (“IPO”) of MMI stock on October 30, 2013, all of the preferred and common stockholders of MMREIS (including MMC and employees of MMREIS) contributed all of their outstanding shares to MMI, in exchange for new MMI common stock. As a result, MMREIS became a wholly-owned subsidiary of MMI. Thereafter, MMC distributed 80.0% of the shares of MMI common stock to MMC’s shareholders and exchanged the remaining portion of its shares of MMI common stock for cancellation of indebtedness of MMC. | |
On November 5, 2013, MMI completed its Initial Public Offering (“IPO”) of 6,900,000 shares of common stock at a price to the public of $12.00 per share of which 4,173,413 shares were sold by the Company and 2,726,587 shares were sold by certain selling stockholders. See Note 9 – “Stockholders’ Equity” for additional information on IPO. | |
Basis of Presentation | Basis of Presentation |
The Company’s consolidated financial statements have been prepared in accordance with US generally accepted accounting principles (“GAAP”). Prior to the Spin-Off, MMI and MMREIS were affiliates under common control and in connection with the Spin-Off, the assets and liabilities of MMREIS were recorded at carryover basis. The historical financial statements of MMREIS, as the Company’s predecessor, have been presented as the historical financial statements of MMI for all periods prior to the Spin-Off from the beginning of the earliest period presented. | |
Consolidation | Consolidation |
The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. | |
Use of Estimates | Use of Estimates |
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. | |
Concentration of Credit Risk | Concentration of Credit Risk |
Financial instruments that potentially subject the Company to a concentration of credit risk principally consist of cash and cash equivalents, due from affiliates, due from independent contractors, investments in marketable securities – available for sale, security deposits (included under other assets, non-current caption) and commissions receivables. Cash is placed with high-credit quality financial institutions and invested high-credit quality money market funds. | |
To reduce its credit risk, the Company monitors the credit standing of the financial institutions that hold the Company’s cash and cash equivalents. The Company historically has not experienced any losses related to cash and cash equivalents or due from affiliates. The Company derives its revenues from a broad range of real estate investors, owners, and users in the United States and Canada, none of which individually represents a significant concentration of credit risk. The Company performs ongoing credit evaluations of its customers and debtors and requires collateral on a case-by-case basis. The Company maintains allowances, as needed, for estimated credit losses based on management’s assessment of the likelihood of collection. For the twelve months ended December 31, 2014 and 2013, no transaction represented 10% or more of total revenues. Further, while one or more transactions may represent 10% or more of commissions receivable at any reporting date, amounts due are typically collected within 10 days of settlement and therefore do not expose the Company to significant credit risk. | |
Reclassifications | Reclassifications |
Certain prior-period amounts in the consolidated financial statements and notes thereto, have been reclassified to conform to the current period presentation. These changes had no impact on the previously reported consolidated results of operations, total assets, total liabilities, stockholders’ equity or cash flow subtotals. In addition to reclassifications within current assets, the Company reclassified $668,000, net in due from independent contractors from other assets long-term to current as of December 31, 2013. | |
Segment Reporting | Segment Reporting |
The Company follows the guidance for segment reporting, which requires reporting information on operating segments in interim and annual financial statements. An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses whose separate financial information is available and is evaluated regularly by the Chief Operating Decision Maker (“CODM”) or decision making group, to perform resource allocations and performance assessments. The CODMs are the Chief Executive Officer and Chief Financial Officer. The CODM review financial information presented on an office-by-office basis for purposes of making operating decisions, assessing financial performance and allocating resources. Based on the evaluation of the Company’s financial information, management believes that the Company’s offices represent individual operating segments with similar economic characteristics that meet the criteria for aggregation into a single reportable segment for financial reporting purposes. The Company’s financing operations also represent an individual operating segment, which does not meet the thresholds to be presented as a separate reportable segment. | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements |
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which supersedes virtually all of the current revenue recognition guidance under U.S. GAAP, and requires entities to recognize revenue for transfer to customer of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. ASU 2014-09 is effective for reporting periods beginning after December 15, 2016 and early adoption is not permitted. ASU 2014-09 permits two implementation approaches, one requiring retrospective application of the new standard with restatement of prior years and one requiring prospective application of the new standard with disclosure of results under old standards. For the Company, the new standard will be effective January 1, 2017. The Company is currently evaluating the impact of this new standard and will select a transition method when the effect is determined; however, the Company does not expect this standard to have a significant effect on the Company’s revenue recognition. | |
In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”). Currently, there is no guidance under U.S. GAAP regarding management’s responsibility to assess whether there is substantial doubt about an entity’s ability to continue as a going concern. Under ASU 2014-15, the Company will be required to assess its ability to continue as a going concern each interim and annual reporting period and provide certain disclosures if there is substantial doubt about the entity’s ability to continue as a going concern, including management’s plan to alleviate the substantial doubt. ASU 2014-15 is effective for reporting periods beginning after December 15, 2016 and early adoption is permitted. For the Company, the new standard will be effective January 1, 2017. This new standard will not have an impact on the Company’s consolidated financial position or results of operations. | |
Cash and Cash Equivalents | Cash and Cash Equivalents |
The Company considers cash and cash equivalents to include short-term, highly liquid investments with maturities of three months or less when purchased. At December 31, 2014 and 2013, a significant portion of the balance of cash and cash equivalents was principally held with three financial institutions and one money market fund. Management believes the likelihood of realizing material losses from the excess of cash balances over federally insured limits is remote. | |
Prior to June 30, 2013, the majority of the cash generated and used in the Company’s operations was held in bank accounts with one financial institution that were included in a sweep arrangement with MMC. Pursuant to a treasury management service agreement with that financial institution, the cash was swept daily into MMC’s money market account. The Company collected interest income from MMC at the same interest rate as MMC earned on the money market account. Historically, other than for a 2-week period around MMC’s March 31 fiscal year end, the Company had a receivable from MMC for the cash that was swept. When the sweep arrangement was not in effect, during the week before and the week after March 31, the Company’s cash balances remained in the Company’s bank accounts. As of June 30, 2013, the sweep arrangement with MMC was permanently terminated. | |
Revenue Recognition | Revenue Recognition |
The Company generates real estate brokerage commissions by acting as a broker for real estate owners or investors seeking to buy or sell commercial properties. Revenues from real estate brokerage commissions are recognized when there is persuasive evidence of an arrangement, all services have been provided, the price is fixed and determinable and collectability is reasonably assured. These criteria are typically met at the close of escrow. The Company generates financing fees from securing financing on purchase transactions as well as fees earned from refinancing its clients’ existing mortgage debt and other financing activities. Revenues from financing fees are recognized at the time the loan closes and there are no remaining significant obligations for performance in connection with the transaction. Other revenues include fees generated from consulting and advisory services, as well as referral fees from other real estate brokers. Revenues from these services are recognized as they are performed and completed. | |
Commissions Receivable | Commissions Receivable |
Commissions receivable consist of commissions earned on brokerage transactions for which payment has not yet been received. The Company evaluates the need for an allowance for doubtful accounts based on the specific-identification of potentially uncollectible accounts. The majority of commission’s receivable are settled within 10 days after the close of escrow. As a result, the Company did not require an allowance for commissions receivable at December 31, 2014 or 2013. | |
Cost of Services | Cost of Services |
Cost of services principally consists of commissions and other costs for the Company’s sales and financing professionals related to transactions closed in the period. Sales and financing professionals commissions are generally paid on transaction revenues and includes referral and other revenues generated by the Company’s sales and financing professionals. Sales and financing professionals are compensated at commission rates based on individual agreements and portions of the commissions due may be deferred in accordance with their contracts. | |
Investments in Marketable Securities, Available for Sale | Investments in Marketable Securities, Available for Sale |
The Company maintains a portfolio of cash equivalents and investments in a variety of fixed and variable rate securities, including U.S. government and agency debt securities, corporate debt securities, asset-backed securities and money market funds. The Company considers its investment in marketable securities to be available-for-sale. Accordingly, these investments are recorded at their fair values, with unrealized gains or losses recorded in other comprehensive income (loss), net of tax. The Company determines the appropriate classification of investments in marketable securities, available for sale at the time of purchase. Interest along with accretion and amortization of purchase premiums and discounts, which are recorded over the remaining weighted average life of the security, are included in other income (expense), net in the consolidated statements of net and comprehensive income. See Note 5 – “Investments in Marketable Securities” for additional information. | |
The Company regularly reviews its investment portfolio to determine if any security is other-than-temporarily impaired, which would require the Company to record an impairment charge in the period any such determination is made. In making this judgment, the Company evaluates, among other items, the duration and extent to which the fair market value of a security is less than its amortized cost and the Company’s intent and ability to sell, or whether the Company will more likely than not be required to sell, the security before recovery of its amortized cost basis. The Company has evaluated its investments in marketable securities as of December 31, 2014 and has determined that no investments with unrealized losses are other-than-temporarily impaired. The Company has no current intent to sell and it is not more likely than not that the Company will be required to sell these investments before recovery of their amortized cost basis, which may be at maturity. | |
Investments Held in Rabbi Trust | Investments Held in Rabbi Trust |
The Company provides a non-qualified deferred compensation program to certain employees. Deferred amounts are contributed to a Rabbi Trust which invests the amounts in variable whole life insurance policies owned by the Company for the participants benefit. Participants may elect to invest in various equity and debt securities offered within the plan on a notional basis. The net change in the carrying value of the underlying assets held in the rabbit trust is recorded in other income (expense), net. The change in the deferred compensation liability as a result the change in the notional value of the participants accounts is recorded as a component of selling general and administrative expenses in the consolidated statements of net and comprehensive income. | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments |
The Company carries its investments including investments in marketable securities, available for sale and investments held in rabbi trust at fair value. The Company defines the fair value of a financial instrument as the amount that would be received from the sale of an asset in an orderly transaction between market participants at the measurement date. The Company is responsible for the determination of the value of the investment carried and fair value and the supporting methodologies and assumptions. The Company uses various pricing sources to validate the values utilized. | |
The degree of judgment used in measuring the fair value of financial instruments generally inversely correlates with the level of observable valuation inputs. Financial instruments with quoted prices in active markets generally have more pricing observability and less judgment is used in measuring fair value. Financial instruments for which no quoted prices are available have less observability and are measured at fair value using valuation models or other pricing techniques that require more judgment. | |
Assets recorded at fair value in the Consolidated Balance Sheets are measured and classified in accordance with a fair value hierarchy consisting of the three “levels” based on the observability of inputs available in the market place used to measure the fair values as discussed below: | |
Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; | |
Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability, or | |
Level 3: Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. | |
Financial Instruments Fair Value | |
The Company’s cash and cash equivalents, commissions receivable, amounts due from employee and sales and financing professionals (included in other assets), accounts payable and accrued expenses and commissions payable are carried at cost, which approximates fair value based on their immediate or short-term maturities and terms, which approximate current market rates and considered to be in the Level 1 classification. | |
Investment in marketable securities, available for sale and investments held in rabbi trust are carried at fair value based on observable inputs available. All these securities are measured as Levels 1 or 2 as appropriate. The Company has no investments measured as Level 3. | |
As the Company’s obligations under notes payable to former stockholders bear fixed interest rates that approximate current interest rates for debt instruments with similar terms and maturities, the Company has determined that the carrying value on these instruments approximates fair value. As the Company’s obligations under SARs liability (included in deferred compensation and commission’s caption) bear interest at a variable rate based on U.S. Treasuries, the Company has determined that the carrying value approximates the fair value. These are considered to be in the Level 2 classification. | |
Property and Equipment, Net | Property and Equipment, Net |
Property and equipment are stated at cost less accumulated depreciation and amortization. The Company uses the straight-line method for depreciation and amortization. Depreciation and amortization are provided over estimated useful lives ranging from three to seven years. | |
The Company occasionally leases certain equipment under capital lease arrangements. The assets and liabilities under capital leases are recorded at the lesser of the present value of aggregate future minimum lease payments, including estimated bargain purchase options, or the fair value of the asset under lease. Assets under capital leases are depreciated using the straight-line method over the lesser of the estimated useful life of the asset or the term of the lease. The Company does not have any remaining capital lease obligations as of December 31, 2014. | |
The Company evaluates its fixed assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. | |
Other Assets | Other Assets |
Other assets consist primarily of amounts due from the Company’s sales and financing professionals, security deposits made in connection with operating leases, customer trust accounts and other receivables. | |
The Company, from time to time, advances funds to or on behalf of its sales and financing professionals. Certain amounts may bear a nominal interest rate, with any cash receipts on notes applied first to any unpaid principal balance prior to any income being recognized. The Company generally has the ability to collect a portion of these amounts from future commissions due to the sales and financing professional or may forgive a portion of the amount depending on the nature of the advance. The Company evaluates the need for an allowance for these amounts based on the specific identification of potentially uncollectible amounts and provides an allowance based on consideration of historical experience. Amounts are written off upon termination of the sales and financing professional as a service provider or when amounts are no longer collectable. | |
In connection with a brokerage transaction, the Company may need to or be required to hold cash in escrow for a transaction participant. These amount are deposited into separate customer trust accounts controlled by the Company. The amounts are included in non-current other assets with a corresponding liability included in other liabilities, both in the Consolidated Balance Sheets. | |
In connection with real estate brokerage activities, the Company may accept a portion of its commission in the form of a commission note receivable. In these cases, the Company considers the need for collateral and evaluates the need for an allowance for these amounts based on the specific identification of potentially uncollectible amounts and provides an allowance based on consideration of historical experience and facts specific to the transaction that gave rise to the commission notes receivable. | |
Deferred Rent Obligation | Deferred Rent Obligation |
Some of the Company’s operating leases contain periods of free or reduced rent or contain predetermined fixed increases in the minimum rent amount during the lease term. For these leases, the Company recognizes rent expense on a straight-line basis over the term of the lease, including periods of free rent or reduced rent, and records the difference between the amount charged to rent expense and the rent paid as a deferred rent obligation. | |
Advertising Costs | Advertising Costs |
Advertising costs are expensed as incurred. Advertising costs are included in selling, general, and administrative expense in the accompanying consolidated statements of net and comprehensive income. | |
Advertising expense for the years ended December 31, 2014, 2013 and 2012 was $965,000, $975,000 and $702,000, respectively. | |
Income Taxes | Income Taxes |
The Company accounts for income taxes under the asset and liability method. The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to (1) differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and (2) operating loss and tax credit carryforwards. The Company measures existing deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which the Company expects to have temporary differences to be recovered or settled. The Company recognizes into income the effect on deferred tax assets and liabilities of a change in tax rates in the period that includes the enactment date. Valuation allowances are provided against deferred tax assets when it is more-likely-than-not that some portion or all of the deferred tax asset will not be realized. | |
Because of the nature of the Company’s business, which includes activity in the U.S. and Canada, incorporating numerous states and provinces as well as local jurisdictions, the Company’s tax position can be complex. As such, the Company’s effective tax rate is subject to changes as a result of changes in the mix of its activity in the various jurisdictions in which the Company operates. | |
The threshold for recognizing the benefits of tax return positions in the financial statements is “more likely than not” to be sustained by the taxing authority and requires measurement of a tax position meeting the more-likely-than-not criterion, based on the largest benefit that is more than 50% likely to be realized. The Company’s inventory of tax positions has been assessed with respect to all applicable income tax issues for all open tax years (in each respective jurisdiction), and has concluded that no uncertain tax positions are required to be recognized in the Company’s consolidated financial statements. | |
The Company recognizes interest and penalties incurred as income tax expense. | |
Prior to the IPO, the Company was part of a consolidated federal income tax return and various combined and consolidated state tax returns that were filed by its previous parent. The Company had a tax-sharing agreement whereby the Company provided for income taxes in its consolidated statements of income using an effective tax rate of 43.5%. In addition, all deferred tax assets and liabilities were recorded by its parent. As part of the Spin-Off, the Company’s tax sharing agreement with its former parent was terminated effective October 31, 2013 and the Company’s allocable net deferred tax assets were transferred to the Company. | |
Stock-Based Compensation | Stock-Based Compensation |
The Company follows the accounting guidance for share based payments which requires the measurement and recognition of compensation expense for all stock based awards made to employees, agents and directors. Awards are issued under the 2013 Omnibus Equity Incentive Plan (the “2013 Plan”) and 2013 Employee Stock Purchase Plan (“2013 ESPP Plan”). | |
For awards made to the Company’s employees and directors, the Company initially values its restricted stock units and restricted stock awards based on the grant date closing price of the Company’s common stock. For awards with periodic vesting, the Company recognizes the related expense on a straight-line basis over the requisite service period for the entire award, subject to periodic adjustments to ensure that the cumulative amount of expense recognized through the end of any reporting period is at least equal to the portion of the grant date value of the award that has vested through that date. | |
For awards made to independent contractors, which are the Company’s sales and financing professionals, the Company determined that the fair value of the award shall be measured based on the fair value of the equity instrument as it is more reliably measureable than the fair value of the consideration received. The Company uses the grant date as the performance commitment date, and the measurement date for these awards is the date the services are completed, which is the vesting date. As a result, the Company records stock-based compensation for these awards over the vesting period on a straight-line basis with periodic adjustments during the vesting period for changes in the fair value of the awards. | |
For the above awards, the Company estimates forfeitures at the time of grant in order to estimate the amount of share-based payment awards ultimately expected to vest and adjusts the recorded expense accordingly. The Company calculates a separate forfeiture rate for its employees and non-employees awards. Forfeitures are required to be revised, if necessary, in subsequent periods. If estimated and actual forfeitures differ from these initial estimates, the Company adjusts the cumulative expense as appropriate to account for the change in the estimated forfeiture rates. If there are any modifications or cancellations of the underlying unvested share-based awards, the Company may be required to accelerate, increase or cancel any remaining unrecognized stock-based compensation expense. Stock-based compensation expense is included in general and administrative expense in the accompanying consolidated statements of net and comprehensive income. | |
For awards issued under the 2013 ESPP Plan, the Company determined that the plan was a compensatory plan and is required to expense the fair value of the awards over each six-month offering period. The Company estimates the fair value of these awards using the Black-Scholes option pricing model. The Company calculates the expected volatility based on the historical volatility of the Company’s common stock and the risk-free interest rate based on the U.S. Treasury yield curve in effect at the time of grant, both consistent with the term of the offering period. The Company incorporates no forfeiture rate and includes no expected dividend yield as the Company has not, and currently does not intend to pay a regular dividend. See Note 9 – “Stockholders’ Equity” for additional information on dividends. | |
Earnings Per Share | Earnings Per Share |
Earnings per share is calculated using net income attributable to Marcus and Millichap, Inc. subsequent to the IPO on October 31, 2013. Earnings per share prior to the IPO has not been presented as the holders of MMREIS Series A Redeemable Preferred Stock were entitled to receive discretionary dividends, payable in preference and priority to any distribution on MMREIS common stock. Since MMREIS typically distributed its earnings to the Series A Preferred stockholders on a quarter-in-arrears basis, earnings per share information for MMREIS common stock prior to the IPO was not meaningful. | |
Basic weighted average shares outstanding includes vested, but un-issued Deferred Stock Units (“DSU’s). The difference between basic and weighted average shares outstanding and diluted weighted average shares outstanding represents the dilutive impact of common stock equivalents consisting of shares to be issued under the 2013 Plan and 2013 ESPP Plan. | |
Foreign Currency Translation | Foreign Currency Translation |
The Company prepares the financial statements of its Canadian subsidiary using the local currency as the functional currency. The assets and liabilities of the Company’s Canadian subsidiary are translated in to U.S. dollars at the rates of exchange at the balance sheet date with the resulting translation adjustments included as a separate component of stockholder’s equity through other comprehensive income (loss) in the consolidated statements of net and comprehensive income. | |
Income and expenses are translated at the average monthly rates of exchange. The Company includes gains and losses from foreign currency transactions in other income (expense), net in the consolidated statements of net and comprehensive income. | |
The effect of foreign currency translation on Cash and cash equivalent is reflected in cash flows from operating activities on the consolidated statements of cash flows, and is not material for any period presented. | |
Taxes Collected From Clients and Remitted to Governmental Authorities | Taxes Collected From Clients and Remitted to Governmental Authorities |
The Company accounts for tax assessed by any governmental authority that is based on revenue or transaction value (i.e. sales, use and value added taxes) on a net basis, excluded from revenue and recorded as current liabilities until paid. | |
Pre-IPO [Member] | |
Stock-Based Compensation | Stock-Based Compensation Prior to the IPO |
MMREIS historically issued stock options and stock appreciation rights, or SARs, to key employees through a book value, stock-based compensation award program (the “Program”). The Program allowed for employees to exercise stock options in exchange for shares of unvested restricted common stock. The Program also allowed employees to exercise options through the issuance of notes receivable, which were recourse to the employee. The determination of the grant price and repurchase price of stock-based awards at the grant date and repurchase date were fixed as determined by a valuation formula using book value, as defined by the agreements between MMREIS and the employees. The stock awards generally vested over a three to five-year period. Under these plans, MMREIS retained the right to repurchase shares if certain events occurred, which included termination of employment. In these circumstances, the plan document provided for repurchase proceeds to be settled in the form of a note payable to (former) shareholders or cash, which was settled over a fixed period. While MMREIS had entered into the agreements to repurchase the stock and settle the SARs held by employees upon termination of their employment (subject to certain conditions as specified in the agreements), MMC had historically assumed the obligation to make payments to the former shareholders. While MMREIS recognized the compensation expense associated with these share-based payment arrangements, the liability had historically been assumed by MMC through a deemed contribution, which then has paid the former shareholders over time. The accounting for the stock options and SARs awards, including MMC’s assumption of MMREIS repurchase obligations, is discussed below. | |
Restricted Common Stock | |
Since stock options only allowed the grantee the right to acquire shares of unvested restricted common stock at book value, which was determined on an annual basis, MMREIS accounted for the stock options and the related unvested restricted stock, as a single instrument, with a single service period. The service period began on the option grant date, and extended through the exercise and subsequent vesting period of the restricted stock. The unvested restricted common stock was accounted for in accordance with ASC 718. Increases or decreases in the formula settlement value of unvested restricted stock subsequent to the grant date, were recorded as increases or decreases, respectively, to compensation expense, with decreases limited to the book value of the stock on the date of grant. As MMC had assumed the Company’s obligation with respect to any appreciation in the value of the underlying vested awards in excess of the employees’ exercise price, MMC was deemed to make a capital contribution to the Company’s additional paid-in capital equal to the amount of compensation expense recorded, net of the applicable taxes. Based on the tax-sharing agreement between the Company and MMC, the tax deduction for the compensation expense recorded by the Company was allocated to MMC. MMC recorded the liability related to the appreciation in the value of the underlying stock in its consolidated financial statements. To the extent of any depreciation in the value of the underlying vested awards (limited to the amount of any appreciation previously recorded from the employees ‘original exercise price), compensation expense was reduced and MMC was deemed to receive a capital distribution. | |
SARs | |
SARs to employees were accounted for in accordance with ASC 718. Similar to the vested stock, compensation expense related to the SARs was recorded in each period and was equal to the appreciation in the formula-settlement value of vested SARs at the end of each reporting period-end from the prior reporting period-end. As MMC had assumed the Company’s obligation with respect to any appreciation in the value of the vested SARs, MMC was deemed to make a capital contribution to the Company’s additional paid-in capital equal to the amount of compensation expense recorded, net of the applicable taxes. Based on the tax-sharing agreement entered between the Company and MMC, the tax deduction for the compensation expense recorded by the Company was allocated to MMC. MMC recorded the liability related to the appreciation in the value of the underlying stock in its consolidated financial statements. To the extent of any depreciation in the value of the vested SARs (limited to the amount of any appreciation previously recorded), compensation expense was reduced and MMC was deemed to have received a capital distribution. |
Property_and_Equipment_Net_Tab
Property and Equipment, Net (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property, Plant and Equipment [Abstract] | |||||||||
Schedule of Property and Equipment, Net | Property and equipment, net consist of the following (in thousands): | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Computer software and hardware equipment | $ | 8,769 | $ | 8,442 | |||||
Furniture, fixtures, and equipment | 14,684 | 19,530 | |||||||
Less accumulated depreciation and amortization | (15,760 | ) | (19,412 | ) | |||||
$ | 7,693 | $ | 8,560 | ||||||
Selected_Balance_Sheet_Data_Ta
Selected Balance Sheet Data (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||
Schedule of Other Assets | Other assets consisted of the following (in thousands): | ||||||||||||||||
Current | Non-Current | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Due from independent contractors, net (1) (2) | $ | 1,577 | $ | 1,249 | $ | 1,820 | $ | 1,280 | |||||||||
Security deposits | — | — | 1,240 | 1,126 | |||||||||||||
Customer trust accounts and other | 1,262 | 1,180 | 222 | 72 | |||||||||||||
$ | 2,839 | $ | 2,429 | $ | 3,282 | $ | 2,478 | ||||||||||
(1) | Includes allowance for doubtful accounts related to current of $193,000 and $223,000 as of December 31, 2014 and 2013, respectively. The Company recorded a provision for bad debt expense of $29,000, $207,000 and $97,000 and wrote off $59,000, $152,000 and $173,000 of these receivables for the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||||||||||
(2) | Represents amounts advanced, notes receivable and other receivables due from the Company’s sales and financing professionals. The notes receivable along with interest, are typically collected from future commissions and are generally due in one to five years. As of December 31, 2014 and 2013, the weighted average interest rate for notes receivable due from the Company’s sales and financing professionals was approximately 2.8% and 2.2%, respectively. Any cash receipts on notes are applied first to unpaid principal balance prior to any income being recognized. | ||||||||||||||||
Components of Deferred Compensation and Commissions | Deferred compensation and commissions consisted of the following (in thousands): | ||||||||||||||||
December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
SARs liability | $ | 20,542 | $ | 19,970 | |||||||||||||
Commissions payable to sales and financing professionals | 12,176 | 8,623 | |||||||||||||||
Deferred compensation liability | 3,863 | 3,584 | |||||||||||||||
$ | 36,581 | $ | 32,177 | ||||||||||||||
Schedule of Other Liabilities | Other liabilities consisted of the following (in thousands): | ||||||||||||||||
December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Long term deferred rent | $ | 2,356 | $ | 2,952 | |||||||||||||
Accrued legal (1) | — | 1,351 | |||||||||||||||
Other | 44 | 68 | |||||||||||||||
$ | 2,400 | $ | 4,371 | ||||||||||||||
(1) | Excludes the current portion of accrued legal, which is included in accounts payable and accrued expenses on the consolidated balance sheets. |
Investments_in_Marketable_Secu1
Investments in Marketable Securities (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||
Schedule of Amortized Cost and Fair Value of Marketable Securities, Available-for-Sale, by Type of Security | Amortized cost and fair value of marketable securities, available-for-sale, by type of security consisted of the following as of December 31, 2014 (in thousands): | ||||||||||||||||
Amortized | Gross | Gross | Fair | ||||||||||||||
Cost | Unrealized | Unrealized | Value | ||||||||||||||
Gains | Losses | ||||||||||||||||
Type of security – long-term: | |||||||||||||||||
U.S. government and agency debt securities | $ | 4,993 | $ | 7 | $ | (3 | ) | $ | 4,997 | ||||||||
Corporate debt securities | 7,442 | 48 | (12 | ) | 7,478 | ||||||||||||
Asset-backed securities | 2,277 | 4 | (4 | ) | 2,277 | ||||||||||||
$ | 14,712 | $ | 59 | $ | (19 | ) | $ | 14,752 | |||||||||
Schedule of Amortized Cost and Fair Value of Marketable Securities, Available-for-Sale, by Contractual Maturity | Amortized cost and fair value of marketable securities, available-for-sale, by contractual maturity consisted of the following as of December 31, 2014 (in thousands): | ||||||||||||||||
Amortized | Fair | ||||||||||||||||
Cost | Value | ||||||||||||||||
Due in one year or less | $ | — | $ | — | |||||||||||||
Due after one year through five years | 4,679 | 4,679 | |||||||||||||||
Due after five years through ten years | 5,652 | 5,662 | |||||||||||||||
Due after ten years | 4,381 | 4,411 | |||||||||||||||
$ | 14,712 | $ | 14,752 | ||||||||||||||
Notes_Payable_to_Former_Stockh1
Notes Payable to Former Stockholders (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Payables and Accruals [Abstract] | |||||
Schedule of Future Minimum Principal and Interest Payments for Notes for Restricted Stock and SARs | As of December 31, 2014, the future minimum principal payments for the Notes for restricted stock and SARs were as follows (in thousands): | ||||
2015 | $ | 894 | |||
2016 | 939 | ||||
2017 | 985 | ||||
2018 | 1,035 | ||||
2019 | 1,087 | ||||
Thereafter | 6,564 | ||||
$ | 11,504 | ||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Schedule of Investments at Fair Value on Recurring Basis | These investments carried at fair value are categorized into one of the three categories described above and consisted of the following (in thousands): | ||||||||||||||||
December 31, 2014 | |||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||
Investments held in rabbi trust | $ | 4,332 | $ | — | $ | 4,332 | $ | — | |||||||||
$ | 4,332 | $ | — | $ | 4,332 | $ | — | ||||||||||
Cash equivalents: | |||||||||||||||||
Money market funds (1): | $ | 25,310 | $ | 25,310 | — | — | |||||||||||
$ | 25,310 | $ | 25,310 | — | — | ||||||||||||
Marketable securities, available for sale | |||||||||||||||||
Long-term investments: | |||||||||||||||||
U.S. government and agency debt securities | $ | 4,997 | $ | 2,980 | $ | 2,017 | $ | — | |||||||||
Corporate debt securities | 7,478 | — | 7,478 | — | |||||||||||||
Asset-backed securities | 2,277 | — | 2,277 | — | |||||||||||||
$ | 14,752 | $ | 2,980 | $ | 11,772 | $ | — | ||||||||||
(1) | Included in cash and cash equivalents. |
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Equity [Abstract] | |||||||||
Components of Accumulated Other Comprehensive Income, Net of Income Taxes | The components of accumulated other comprehensive income, net of income taxes consists of the following (in thousands): | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Unrealized gain on marketable securities, net | $ | 24 | $ | — | |||||
Foreign currency translation gain, net | 135 | — | |||||||
$ | 159 | $ | — | ||||||
Schedule of Deemed Capital Contribution (Distribution) | A summary of the deemed capital contributions (distributions) from MMC recorded in additional paid in capital is as follows (in thousands): | ||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Compensation cost for unvested restricted stock and SARs, net of tax | $ | 2,655 | $ | 4,209 | |||||
SARs liability | (19,970 | ) | — | ||||||
Notes payable to former stockholders | (12,230 | ) | — | ||||||
Interest expense related to notes payable to former stockholders | (318 | ) | — | ||||||
Deferred taxes assets, net | 26,572 | — | |||||||
$ | (3,291 | ) | $ | 4,209 | |||||
StockBased_Compensation_Plans_
Stock-Based Compensation Plans (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Summary of Stock Option Activity - Pre-IPO | The following is a summary of MMREIS’s stock option activity: | ||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
Shares | Weighted- | Shares | Weighted- | ||||||||||||||||||
Under | Average | Under | Average | ||||||||||||||||||
Options | Exercise | Options | Exercise | ||||||||||||||||||
Price | Price | ||||||||||||||||||||
Options outstanding at beginning of year: | 750 | $ | 28.86 | 3,500 | $ | 25.67 | |||||||||||||||
Granted | — | — | 750 | 28.86 | |||||||||||||||||
Exercised | (750 | ) | 28.86 | (3,500 | ) | 25.67 | |||||||||||||||
Options outstanding at end of year | — | $ | — | 750 | $ | 28.86 | |||||||||||||||
Summary of Restricted Common Stock Activity - Pre - IPO | The following is a summary of MMREIS’s restricted common stock activity: | ||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
Restricted | Weighted- | Restricted | Weighted- | ||||||||||||||||||
Stock | Average | Stock | Average | ||||||||||||||||||
Grant | Grant | ||||||||||||||||||||
Date Fair | Date Fair | ||||||||||||||||||||
Value | Value | ||||||||||||||||||||
Restricted common stock outstanding at beginning of year: | 27,999 | $ | 23.67 | 24,499 | $ | 23.36 | |||||||||||||||
Issued upon exercise of stock options | 750 | 28.86 | 3,500 | 25.87 | |||||||||||||||||
Exchange of common stock (1) | (28,749 | ) | — | — | — | ||||||||||||||||
Restricted common stock outstanding at end of year | — | $ | — | 27,999 | $ | 23.67 | |||||||||||||||
Restricted common stock vested at end of year | — | 22,682 | |||||||||||||||||||
Restricted common stock unvested at end of year | — | 5,317 | |||||||||||||||||||
(1) | Exchanged for new Marcus & Millichap stock prior to the IPO. Refer to Note 9 – “Stockholders’ Equity” for additional information on the exchange of common stock. | ||||||||||||||||||||
Summary of SARs Activity - Pre - IPO | The following is a summary of MMREIS’s SARs activity: | ||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
SARs outstanding at beginning of period: | 28,733 | 27,983 | |||||||||||||||||||
Granted | — | 750 | |||||||||||||||||||
Settled (1) | (28,733 | ) | — | ||||||||||||||||||
SARs outstanding at end of period | — | 28,733 | |||||||||||||||||||
SARs vested at end of period | — | 22,666 | |||||||||||||||||||
(1) | Prior to the IPO, outstanding SAR’s were settled by exchanging the SAR’s for DSU’s for 2,192,413 shares of the new Marcus & Millichap common stock and a fixed SAR’s liability amount. SeeAmendments to Restricted Stock and SARs below. | ||||||||||||||||||||
Components of Stock-Based Compensation Included in Consolidated Statements of Net and Comprehensive Income | The following table summarizes the components of stock-based compensation included in the consolidated statements of net and comprehensive income (in thousands): | ||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Restricted stock and SARs (prior to IPO) | $ | — | $ | 4,679 | $ | 7,448 | |||||||||||||||
Stock based compensation in connection with IPO | — | 30,886 | — | ||||||||||||||||||
Employee stock purchase plan | 128 | — | — | ||||||||||||||||||
RSAs – non-employee directors | 197 | 20 | — | ||||||||||||||||||
RSUs – employees | 817 | 88 | — | ||||||||||||||||||
RSUs – independent contractors | 3,892 | 168 | — | ||||||||||||||||||
$ | 5,034 | $ | 35,841 | $ | 7,448 | ||||||||||||||||
Post IPO [Member] | |||||||||||||||||||||
Outstanding Awards Under 2013 Omnibus Equity Incentive Plan | The following table summarizes the Company’s activity under the 2013 Plan for the year ended December 31, 2014 (dollars in thousands, except per share data): | ||||||||||||||||||||
RSA Grants to Non- | RSU Grants to | RSU Grants to | Total | Weighted- | |||||||||||||||||
employee Directors | Employees | Independent | Average Grant | ||||||||||||||||||
Contractors | Date Fair Value | ||||||||||||||||||||
Per Share | |||||||||||||||||||||
Nonvested shares at December 31, 2013 | 30,000 | 313,155 | 570,760 | 913,915 | $ | 14.46 | |||||||||||||||
Granted | |||||||||||||||||||||
Feb-14 | — | — | 38,088 | 38,088 | |||||||||||||||||
May-14 | 22,884 | 6,991 | 31,780 | 61,655 | |||||||||||||||||
Aug-14 | — | 6,346 | 12,474 | 18,820 | |||||||||||||||||
Nov-14 | — | 9,584 | 4,638 | 14,222 | |||||||||||||||||
Dec-14 | — | 216,411 | — | 216,411 | |||||||||||||||||
Total Granted | 22,884 | 239,332 | 86,980 | 349,196 | 27.46 | ||||||||||||||||
Vested | (10,002 | ) | — | — | (10,002 | ) | 12 | ||||||||||||||
Transferred | — | (8,596 | ) | 8,596 | — | 14.54 | |||||||||||||||
Forfeited/canceled | — | (27,454 | ) | (18,646 | ) | (46,100 | ) | 14.65 | |||||||||||||
Nonvested shares at December 31, 2014 (1) | 42,882 | 516,437 | 647,690 | 1,207,009 | $ | 18.23 | |||||||||||||||
Unrecognized stock-based compensation expense as of December 31, 2014 (2) | $ | 503 | $ | 10,126 | $ | 16,546 | $ | 27,175 | |||||||||||||
Weighted average remaining vesting period (years) as of December 31, 2014 | 2.11 | 4.46 | 4.05 | 4.15 | |||||||||||||||||
(1) | Nonvested RSU’s will be settled through the issuance of new shares of common stock. | ||||||||||||||||||||
(2) | The total unrecognized compensation expense is expected to be recognized over a weighted-average period of approximately 4.15 years. |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Schedule of Provision for Income Taxes | The provision for income taxes consists of the following (in thousands): | ||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Federal: | |||||||||||||
Current | $ | 28,452 | $ | 20,245 | $ | 18,866 | |||||||
Deferred | (566 | ) | (8,077 | ) | — | ||||||||
27,886 | 12,168 | 18,866 | |||||||||||
State: | |||||||||||||
Current | 4,123 | 2,522 | 2,641 | ||||||||||
Deferred | 1,443 | (1,199 | ) | — | |||||||||
5,566 | 1,323 | 2,641 | |||||||||||
Foreign: | |||||||||||||
Current | — | 244 | — | ||||||||||
Deferred | — | — | — | ||||||||||
244 | |||||||||||||
Provision for income taxes | $ | 33,452 | $ | 13,735 | $ | 21,507 | |||||||
Significant Components of Deferred Tax Assets (Liabilities), Net | Significant components of the Company’s deferred tax assets (liabilities), net are as follows (in thousands): | ||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Deferred Tax Assets, Net | |||||||||||||
Current: | |||||||||||||
Accrued expenses and bonuses | $ | 5,435 | $ | 5,668 | |||||||||
Bad debt and other reserves | 2,009 | 1,290 | |||||||||||
Deferred compensation | 2,796 | 2,325 | |||||||||||
Stock compensation | 4,205 | 369 | |||||||||||
Deferred rent | 324 | 335 | |||||||||||
Prepaid expenses | (1,392 | ) | (915 | ) | |||||||||
State taxes | 250 | (389 | ) | ||||||||||
Current deferred tax assets, net before valuation allowance | 13,627 | 8,683 | |||||||||||
Valuation allowance | (27 | ) | (20 | ) | |||||||||
Current deferred tax assets, net | $ | 13,600 | $ | 8,663 | |||||||||
Non-current: | |||||||||||||
Fixed assets and leasehold improvements | $ | 203 | $ | 427 | |||||||||
Litigation reserve | — | 887 | |||||||||||
Deferred compensation | 6,076 | 6,396 | |||||||||||
Stock compensation | 15,502 | 19,151 | |||||||||||
Deferred Rent | 997 | 1,259 | |||||||||||
Other comprehensive income | (113 | ) | — | ||||||||||
Unrealized gain on foreign currency | 56 | — | |||||||||||
Net operating loss carryforwards | 680 | 1,544 | |||||||||||
State taxes | (1,435 | ) | (2,213 | ) | |||||||||
Non-current deferred tax assets, net before valuation allowance | 21,966 | 27,451 | |||||||||||
Valuation allowance | (701 | ) | (266 | ) | |||||||||
Non-Current deferred tax assets, net | $ | 21,265 | $ | 27,185 | |||||||||
Components of Provision for Income Taxes and Income before Provision for Income Taxes | The provision for income taxes differs from the amount computed by applying the statutory federal corporate income tax rate of 35% to income before provision for income taxes as a result of the following (in thousands): | ||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Income tax expense at the federal statutory rate of 35% | $ | 29,044 | $ | 7,679 | $ | 17,305 | |||||||
State income tax expenses, net of federal benefit | 3,622 | 985 | 2,423 | ||||||||||
Permanent difference related to compensation charges | 163 | 3,445 | — | ||||||||||
Other | 181 | 361 | 8 | ||||||||||
Change in valuation allowance | 442 | — | — | ||||||||||
Differences due to tax-sharing agreement | — | 1,265 | 1,771 | ||||||||||
Provision for income taxes | $ | 33,452 | $ | 13,735 | $ | 21,507 | |||||||
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Earnings Per Share [Abstract] | |||||||||
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share subsequent to the IPO for the year ended December 31, 2014 and the period from October 31, 2013 through December 31, 2013 (in thousands, except per share data): | ||||||||
Year Ended | Period from | ||||||||
December 31, 2014 | October 31, 2013 | ||||||||
through December | |||||||||
31, 2013 | |||||||||
Numerator (Basic and Diluted): | |||||||||
Net income attributable to Marcus & Millichap, Inc. | $ | $49,531 | $ | 9,251 | |||||
Denominator: | |||||||||
Basic | |||||||||
Weighted average common shares issued and outstanding | 36,660 | 36,541 | |||||||
Deduct: Unvested RSAs (1) | (43 | ) | (30 | ) | |||||
Add: Fully vested DSUs (2) | 2,234 | 2,276 | |||||||
Weighted Average Common Shares Outstanding | 38,851 | 38,787 | |||||||
Basic earnings per common share | $ | 1.27 | $ | 0.24 | |||||
Diluted | |||||||||
Weighted Average Common Shares Outstanding from above | 38,851 | 38,787 | |||||||
Add: Dilutive effect of RSUs, RSAs & ESPP | 127 | 28 | |||||||
Weighted Average Common Shares Outstanding | 38,978 | 38,815 | |||||||
Diluted earnings per common share | $ | 1.27 | $ | 0.24 | |||||
(1) | RSAs were issued and outstanding to the non-employee directors and have a three year vesting term subject to service requirements. See Note 10 – “Stock-Based Compensation Plans” for additional information. | ||||||||
(2) | DSUs shares are included in weighted average common shares outstanding as the DSUs were fully vested upon receipt. See Note 10 – “Stock-Based Compensation Plans” for additional information. |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments and Contingencies Disclosure [Abstract] | |||||
Schedule of Future Minimum Lease Payments for Operating Leases | As of December 31, 2014, the future minimum lease payments under non-cancelable operating leases for office facilities and automobiles with terms in excess of one year are as follows (in thousands): | ||||
2015 | $ | 13,144 | |||
2016 | 10,198 | ||||
2017 | 7,535 | ||||
2018 | 5,995 | ||||
2019 | 3,338 | ||||
Thereafter | 5,658 | ||||
$ | 45,868 | ||||
Selected_Quarterly_Financial_D1
Selected Quarterly Financial Data (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Schedule of Quarterly Financial Data | |||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
Dec. 31 | Sep. 30 | Jun. 30 | Mar. 31 | Dec. 31 | Sep. 30 | Jun. 30 | Mar. 31 | ||||||||||||||||||||||||||
2014 | 2014 | 2014 | 2014 | 2013 (1) | 2013 | 2013 | 2013 | ||||||||||||||||||||||||||
(in thousands, except per share data) | |||||||||||||||||||||||||||||||||
Consolidated Financial Statement Data: | |||||||||||||||||||||||||||||||||
Total revenues | $ | 172,444 | $ | 150,889 | $ | 134,265 | $ | 114,590 | $ | 149,101 | $ | 111,953 | $ | 105,471 | $ | 69,370 | |||||||||||||||||
Cost of services | 109,836 | 92,269 | 79,601 | 68,396 | 94,242 | 67,718 | 61,456 | 41,221 | |||||||||||||||||||||||||
Operating income (loss) | 27,097 | 23,721 | 21,726 | 12,062 | (8,165 | ) | 12,625 | 14,169 | 2,657 | ||||||||||||||||||||||||
Net income (loss) | 16,430 | 13,523 | 12,796 | 6,782 | (8,716 | ) | 7,275 | 8,009 | 1,638 | ||||||||||||||||||||||||
Net (loss) income (attributable to MMREIS prior to IPO on October 31, 2013) | — | — | — | — | (17,967 | ) | 7,275 | 8,009 | 1,638 | ||||||||||||||||||||||||
Net income attributable to Marcus & Millichap, Inc. subsequent to IPO on October 31, 2013 | $ | 16,430 | $ | 13,523 | $ | 12,796 | $ | 6,782 | $ | 9,251 | $ | — | $ | — | $ | — | |||||||||||||||||
Earnings per share (2): | |||||||||||||||||||||||||||||||||
Basic | $ | 0.42 | $ | 0.35 | $ | 0.33 | $ | 0.17 | $ | 0.24 | |||||||||||||||||||||||
Diluted | $ | 0.42 | $ | 0.35 | $ | 0.33 | $ | 0.17 | $ | 0.24 | |||||||||||||||||||||||
(1) | The three months ended December 31, 2013 include non-cash stock-based and other compensation charges of $31.3 million. See Note 10 – “Stock-Based Compensation Plans” for additional information. | ||||||||||||||||||||||||||||||||
(2) | Earnings per share information are presented for periods subsequent to the IPO on October 31, 2013. See Note 13 – “Earnings Per Share” for additional information. |
Description_of_Business_Basis_2
Description of Business, Basis of Presentation and Recent Accounting Pronouncements - Additional Information (Detail) (USD $) | 12 Months Ended | 0 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Nov. 05, 2013 | Nov. 30, 2013 | |
Office | ||||
Class of Stock [Line Items] | ||||
Number of offices in the United States and Canada | 78 | |||
Contribution date | 30-Oct-13 | |||
Percentage of common stock distributed | 80.00% | |||
Reclassification from other assets long-term to current | $668,000 | |||
Maximum [Member] | ||||
Class of Stock [Line Items] | ||||
Commission's receivable settled period | 10 days | |||
Customer Concentration Risk [Member] | Total revenues [Member] | Maximum [Member] | ||||
Class of Stock [Line Items] | ||||
Concentration of credit risk percentage | 10.00% | 10.00% | ||
Customer Concentration Risk [Member] | Commissions receivable [Member] | Maximum [Member] | ||||
Class of Stock [Line Items] | ||||
Concentration of credit risk percentage | 10.00% | 10.00% | ||
MMI [Member] | ||||
Class of Stock [Line Items] | ||||
Formation date | 2013-06 | |||
IPO [Member] | ||||
Class of Stock [Line Items] | ||||
Common stock sold during initial public offering | 6,900,000 | |||
Common stock sold and issued under IPO, price per share | $12 | $12 | ||
Description of IPO | On November 5, 2013, MMI completed its Initial Public Offering (bIPOb) of 6,900,000 shares of common stock at a price to the public of $12.00 per share of which 4,173,413 shares were sold by the Company and 2,726,587 shares were sold by certain selling stockholders. | |||
IPO MMI [Member] | ||||
Class of Stock [Line Items] | ||||
Common stock sold during initial public offering | 4,173,413 | |||
IPO Selling Stockholder [Member] | ||||
Class of Stock [Line Items] | ||||
Common stock sold during initial public offering | 2,726,587 |
Accounting_Policies_Additional
Accounting Policies - Additional Information (Detail) (USD $) | 12 Months Ended | 0 Months Ended | 10 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2013 | Jun. 30, 2013 | |
Fund | Financial_Institution | |||||
Accounting Policies [Line Items] | ||||||
Number of money market fund | 1 | |||||
Description of cash sweep arrangement | Historically, other than for a 2-week period around MMC's March 31 fiscal year end, the Company had a receivable from MMC for the cash that was swept. When the sweep arrangement was not in effect, during the week before and the week after March 31, the Company's cash balances remained in the Company's bank accounts. | |||||
Sweep arrangement termination date | 30-Jun-13 | |||||
Allowance for commissions receivable | $0 | $0 | ||||
Capital lease obligations | 0 | |||||
Advertising expense | 965,000 | 975,000 | 702,000 | |||
Income tax benefit realized, percentage | 50.00% | |||||
Uncertain tax positions | $0 | $0 | ||||
Tax sharing agreement termination date | 31-Oct-13 | |||||
Cash Operating Bank Account [Member] | ||||||
Accounting Policies [Line Items] | ||||||
Number of financial institutions | 1 | |||||
Cash and Cash Equivalents Bank Accounts [Member] | ||||||
Accounting Policies [Line Items] | ||||||
Number of financial institutions | 3 | 3 | ||||
Employee Stock Purchase Plan [Member] | ||||||
Accounting Policies [Line Items] | ||||||
Length of purchase intervals | 6 months | |||||
Expected dividend yield | 0.00% | |||||
ESPP shares forfeiture rate | 0.00% | |||||
Tax-sharing agreement [Member] | ||||||
Accounting Policies [Line Items] | ||||||
Effective income tax rate, pre-IPO | 43.50% | 43.50% | 43.50% | |||
Tax sharing agreement termination date | 31-Oct-13 | |||||
Minimum [Member] | ||||||
Accounting Policies [Line Items] | ||||||
Property and equipment, estimated useful lives | 3 years | |||||
Minimum [Member] | Pre-IPO [Member] | ||||||
Accounting Policies [Line Items] | ||||||
Restricted common stock issued, vesting period | 3 years | |||||
Maximum [Member] | ||||||
Accounting Policies [Line Items] | ||||||
Commission's receivable settled period | 10 days | |||||
Property and equipment, estimated useful lives | 7 years | |||||
Maximum [Member] | Pre-IPO [Member] | ||||||
Accounting Policies [Line Items] | ||||||
Restricted common stock issued, vesting period | 5 years |
Property_and_Equipment_Schedul
Property and Equipment - Schedule of Property and Equipment, Net (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Property, Plant and Equipment [Line Items] | ||
Less: accumulated depreciation and amortization | ($15,760) | ($19,412) |
Property and equipment, net | 7,693 | 8,560 |
Computer software and hardware equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 8,769 | 8,442 |
Furniture, fixtures, and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $14,684 | $19,530 |
Property_and_Equipment_Additio
Property and Equipment - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization expense on property and equipment | $3,206,000 | $3,043,000 | $2,981,000 |
Capital lease obligations | 0 | ||
Furniture, fixtures, and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Fully depreciated no longer in use furniture, fixtures and equipment write-off | $7,700,000 |
Selected_Balance_Sheet_Data_Sc
Selected Balance Sheet Data - Schedule of Other Assets (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Other Assets [Line Items] | ||
Other assets Current | $2,839 | $2,429 |
Other assets Non-Current | 3,282 | 2,478 |
Due from independent contractors [Member] | ||
Other Assets [Line Items] | ||
Other assets Current | 1,577 | 1,249 |
Other assets Non-Current | 1,820 | 1,280 |
Security deposits [Member] | ||
Other Assets [Line Items] | ||
Other assets Non-Current | 1,240 | 1,126 |
Customer trust accounts and other [Member] | ||
Other Assets [Line Items] | ||
Other assets Current | 1,262 | 1,180 |
Other assets Non-Current | $222 | $72 |
Selected_Balance_Sheet_Data_Sc1
Selected Balance Sheet Data - Schedule of Other Assets (Parenthetical) (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Other Assets [Line Items] | |||
Allowance of doubtful accounts | $193,000 | $223,000 | |
Provision for bad debt expense | 29,000 | 207,000 | 97,000 |
Write-off receivables | $59,000 | $152,000 | $173,000 |
Weighted average interest rate for notes receivable | 2.80% | 2.20% | |
Minimum [Member] | |||
Other Assets [Line Items] | |||
Notes receivable due period | 1 year | ||
Maximum [Member] | |||
Other Assets [Line Items] | |||
Notes receivable due period | 5 years |
Selected_Balance_Sheet_Data_Co
Selected Balance Sheet Data - Components of Deferred Compensation and Commissions (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 |
In Thousands, unless otherwise specified | |||
Balance Sheet Related Disclosures [Abstract] | |||
SARs liability | $20,542 | $19,970 | $20,000 |
Commissions payable to sales and financing professionals | 12,176 | 8,623 | |
Deferred compensation liability | 3,863 | 3,584 | |
Total | $36,581 | $32,177 |
Selected_Balance_Sheet_Data_Ad
Selected Balance Sheet Data - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | |||
Jan. 02, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2013 | |
Schedule Of Accrued Expenses [Line Items] | |||||
SARs frozen liability amount | $20,542,000 | $19,970,000 | $20,000,000 | ||
SARs liability frozen value date | 31-Mar-13 | ||||
SARs liability interest accrual commencement date | 1-Jan-14 | ||||
Interest expense | 1,651,000 | 105,000 | 4,000 | ||
Treasury note term | 10 years | ||||
Base spread on SARs liability variable rate | 2.00% | ||||
SARs liability interest accrual rate | 5.03% | ||||
Stock appreciation rights liability distribution | 412,000 | ||||
Maximum payment deferral period for certain commissions payable | 3 years | ||||
Fair value of deferred compensation plan assets | 110.00% | ||||
Net change in carrying value of investments held in rabbi trust | 290,000 | 495,000 | 353,000 | ||
Deferred Compensation Liability [Member] | |||||
Schedule Of Accrued Expenses [Line Items] | |||||
Net change in carrying value of deferred compensation obligation | 313,000 | 504,000 | 353,000 | ||
SARs [Member] | |||||
Schedule Of Accrued Expenses [Line Items] | |||||
Interest expense | 984,000 | ||||
Stock appreciation rights liability distribution | $412,000 |
Selected_Balance_Sheet_Data_Sc2
Selected Balance Sheet Data - Schedule of Other Liabilities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Other Liabilities Disclosure [Abstract] | ||
Long term deferred rent | $2,356 | $2,952 |
Accrued legal | 0 | 1,351 |
Other | 44 | 68 |
Other liabilities | $2,400 | $4,371 |
Investments_in_Marketable_Secu2
Investments in Marketable Securities - Schedule of Amortized Cost and Fair Value of Marketable Securities, Available-for-Sale, by Type of Security (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | $14,712 |
Fair Value | 14,752 |
Long-term marketable securities [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | 14,712 |
Gross Unrealized Gains | 59 |
Gross Unrealized Losses | -19 |
Fair Value | 14,752 |
Long-term marketable securities [Member] | U.S. government and agency debt securities [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | 4,993 |
Gross Unrealized Gains | 7 |
Gross Unrealized Losses | -3 |
Fair Value | 4,997 |
Long-term marketable securities [Member] | Corporate debt securities [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | 7,442 |
Gross Unrealized Gains | 48 |
Gross Unrealized Losses | -12 |
Fair Value | 7,478 |
Long-term marketable securities [Member] | Asset-backed securities [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | 2,277 |
Gross Unrealized Gains | 4 |
Gross Unrealized Losses | -4 |
Fair Value | $2,277 |
Investments_in_Marketable_Secu3
Investments in Marketable Securities - Additional Information (Detail) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-sale-securities, Continuous unrealized loss position for less than 12 months | $5,400,000 |
Available-for-sale-securities, Continuous unrealized loss position for 12 months or longer | 0 |
Available for sale securities sold | 0 |
Other-than-temporary impairment | $0 |
Weighted average maturity period of available-for-sale securities | 9 years 7 months 6 days |
Investments_in_Marketable_Secu4
Investments in Marketable Securities - Schedule of Amortized Cost and Fair Value of Marketable Securities, Available-for-Sale, by Contractual Maturity (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Investments, Debt and Equity Securities [Abstract] | |
Due in one year or less, Amortized Cost | $0 |
Due after one year through five years, Amortized Cost | 4,679 |
Due after five years through ten years, Amortized Cost | 5,652 |
Due after ten years, Amortized Cost | 4,381 |
Amortized Cost | 14,712 |
Due in one year or less, Fair Value | 0 |
Due after one year through five years, Fair Value | 4,679 |
Due after five years through ten years, Fair Value | 5,662 |
Due after ten years, Fair Value | 4,411 |
Total Fair Value | $14,752 |
Notes_Payable_to_Former_Stockh2
Notes Payable to Former Stockholders - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Notes Payable [Line Items] | |||
Accrued interest expense pertaining to Notes | $396,000 | $425,000 | |
Interest expense | 1,651,000 | 105,000 | 4,000 |
Accrued interest expense related to IPO | 318,000 | ||
Payments of principal and interest amount | 1,500,000 | ||
Payments pertained to interest | 618,000 | ||
Payments pertained to principal | 851,000 | ||
Restricted Stock - Notes Payable [Member] | |||
Notes Payable [Line Items] | |||
Unsecured notes interest rate | 5.00% | ||
Unsecured notes maturity date | 14-Apr-20 | ||
SARs - Notes Payable [Member] | |||
Notes Payable [Line Items] | |||
Unsecured notes interest rate | 5.00% | ||
Unsecured notes maturity date | 30-Jun-20 | ||
Notes Payable to Former Stockholders [Member] | |||
Notes Payable [Line Items] | |||
Interest expense | $591,000 | $103,000 |
Notes_Payable_to_Former_Stockh3
Notes Payable to Former Stockholders - Schedule of Future Minimum Principal and Interest Payments for Notes for Restricted Stock and SARs (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Equity Method Investments And Cost Method Investments [Abstract] | ||
2015 | $894 | $851 |
2016 | 939 | |
2017 | 985 | |
2018 | 1,035 | |
2019 | 1,087 | |
Thereafter | 6,564 | |
Total | $11,504 |
RelatedParty_Transactions_Addi
Related-Party Transactions - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Related Party Transaction [Line Items] | |||
Accounts payable and other accrued expenses - related party | $97,000 | $506,000 | |
Transition services agreement date | 1-Oct-13 | ||
Real estate brokerage commissions and financing fees from transactions with former parent, Marcus & Millichap Company | 1,300,000 | 735,000 | 1,100,000 |
Commission expenses for transactions with former parent, Marcus & Millichap Company | 816,000 | 441,000 | 711,000 |
Rent expense for lease | 16,700,000 | 15,700,000 | 14,500,000 |
Aggregate principal amount outstanding for employee notes receivable | 378,000 | 418,000 | |
Sweep arrangement termination date | 30-Jun-13 | ||
MMC [Member] | |||
Related Party Transaction [Line Items] | |||
Rent expense for lease | 438,000 | 398,000 | 278,000 |
Lease expiration date | 31-May-22 | ||
Interest income earned from MMC | 0 | 74,000 | 147,000 |
MMC [Member] | Shared Services [Member] | |||
Related Party Transaction [Line Items] | |||
General and administrative expense | 4,300,000 | 4,800,000 | |
MMC [Member] | Shared Services [Member] | Health Insurance Premium [Member] | |||
Related Party Transaction [Line Items] | |||
General and administrative expense | 3,200,000 | 3,500,000 | |
MMC [Member] | Transition Services Agreement [Member] | |||
Related Party Transaction [Line Items] | |||
General and administrative expense | 1,300,000 | 824,000 | |
Accounts payable and other accrued expenses - related party | 97,000 | 506,000 | |
MMC [Member] | Transition Services Agreement [Member] | Health Insurance Premium [Member] | |||
Related Party Transaction [Line Items] | |||
General and administrative expense | $1,000,000 | $687,000 | |
Mr. Marcus [Member] | |||
Related Party Transaction [Line Items] | |||
Percentage of ownership in diluted shares | 65.00% | ||
Shares for future sale | 4,600,000 | ||
Registration Statement date | 6-Feb-15 |
Fair_Value_Measurements_Schedu
Fair Value Measurements - Schedule of Investments at Fair Value on Recurring Basis (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | $4,332 | $4,067 |
Marketable securities, available for sale | 14,752 | |
Recurring [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | 4,332 | |
Cash equivalents | 25,310 | |
Marketable securities, available for sale | 14,752 | |
Recurring [Member] | Cash Equivalents [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Cash equivalents | 25,310 | |
Recurring [Member] | Investments held in rabbi trust [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | 4,332 | |
Recurring [Member] | U.S. government and agency debt securities [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Marketable securities, available for sale | 4,997 | |
Recurring [Member] | Corporate debt securities [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Marketable securities, available for sale | 7,478 | |
Recurring [Member] | Asset-backed securities [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Marketable securities, available for sale | 2,277 | |
Level 1 [Member] | Recurring [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Cash equivalents | 25,310 | |
Marketable securities, available for sale | 2,980 | |
Level 1 [Member] | Recurring [Member] | Cash Equivalents [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Cash equivalents | 25,310 | |
Level 1 [Member] | Recurring [Member] | U.S. government and agency debt securities [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Marketable securities, available for sale | 2,980 | |
Level 2 [Member] | Recurring [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | 4,332 | |
Marketable securities, available for sale | 11,772 | |
Level 2 [Member] | Recurring [Member] | Investments held in rabbi trust [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | 4,332 | 4,100 |
Level 2 [Member] | Recurring [Member] | U.S. government and agency debt securities [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Marketable securities, available for sale | 2,017 | |
Level 2 [Member] | Recurring [Member] | Corporate debt securities [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Marketable securities, available for sale | 7,478 | |
Level 2 [Member] | Recurring [Member] | Asset-backed securities [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Marketable securities, available for sale | $2,277 |
Fair_Value_Measurements_Additi
Fair Value Measurements - Additional Information (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | $4,332 | $4,067 |
Recurring [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | 4,332 | |
Recurring [Member] | Investments held in rabbi trust [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | 4,332 | |
Level 2 [Member] | Recurring [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | 4,332 | |
Level 2 [Member] | Recurring [Member] | Investments held in rabbi trust [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis Financial Statement Captions [Line Items] | ||
Investments held in rabbi trust | $4,332 | $4,100 |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) (USD $) | 0 Months Ended | 10 Months Ended | 12 Months Ended | ||||
Nov. 05, 2013 | Oct. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2013 | Nov. 30, 2013 | |
Stockholders Equity [Line Items] | |||||||
Common stock, shares issued | 36,918,442 | 36,600,897 | |||||
Common stock, shares outstanding | 36,918,442 | 36,600,897 | |||||
Common stock share, par value | $1 | $0.00 | $0.00 | ||||
Common stock dividends declared and paid | $0 | ||||||
Preferred stock, shares authorized | 25,000,000 | 25,000,000 | |||||
Preferred stock, par value | $0.00 | $0.00 | |||||
Preferred stock, shares issued | 0 | 0 | |||||
Preferred stock, shares outstanding | 0 | 0 | |||||
Preferred stock, voting rights | The pre-IPO Series A Preferred stockholders did not have voting rights. | ||||||
Prior to completion of IPO date | 30-Oct-13 | ||||||
Proceeds from IPO | 42,300,000 | ||||||
IPO related expenses | 4,300,000 | ||||||
Preferred stock dividends declared and paid | 37,681,000 | 37,681,000 | 30,756,000 | ||||
Stock appreciations rights liability, amount | 20,542,000 | 19,970,000 | 20,000,000 | ||||
Notes payable to former stockholders | 11,504,000 | ||||||
Interest expense related to notes payable to former stockholders | 318,000 | ||||||
Deferred tax assets, net transferred from parent prior to IPO | 26,600,000 | 26,572,000 | |||||
Deferred tax assets, net transferred from parent prior to IPO, effective tax rate used for calculation | 40.00% | ||||||
IPO [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Common stock issued | 6,900,000 | ||||||
IPO completion date | 5-Nov-13 | ||||||
Common stock sold and issued under IPO, price per share | $12 | $12 | |||||
IPO MMI [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Common stock issued | 4,173,413 | ||||||
IPO Underwriters [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Common stock issued | 900,000 | ||||||
Underwriting discounts and commissions | 3,500,000 | ||||||
IPO Selling Stockholder [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Common stock issued | 2,726,587 | ||||||
MMREIS [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Common stock, shares issued | 234,489 | 234,489 | |||||
Common stock, shares outstanding | 234,489 | 234,489 | |||||
Common stock dividends declared and paid | 0 | 0 | |||||
Exchange of Stock for Stock [Member] | MMC [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Common stock share, par value | $0.00 | ||||||
Notes Payable APIC [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Notes payable to former stockholders | $12,200,000 | ||||||
Series A redeemable preferred stock [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Preferred stock, par value | $10 | ||||||
Preferred stock, shares issued | 1,000 | ||||||
Preferred stock, shares outstanding | 1,000 | ||||||
Preferred stock liquidation preference per share | $10 | $10 | |||||
Preferred stock, redemption value per share | $10 | ||||||
Exchange of common stock | 1,000 | 1,000 | |||||
Preferred stock, dividend per share | $10 | $10 | |||||
MMREIS Common Stock [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Exchange of common stock | 234,489 | 234,489 | |||||
Marcus And Millichap Common Stock [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Exchange of common stock | 32,357,901 | ||||||
MMREIS Managing Directors [Member] | MMREIS Common Stock [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Exchange of common stock | 28,749 | ||||||
Restricted Stock [Member] | Non-employee directors [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Common stock issued | 42,882 | 30,000 |
Stockholders_Equity_Components
Stockholders' Equity - Components of Accumulated Other Comprehensive Income, Net of Income Taxes (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Equity [Abstract] | |
Unrealized gain on marketable securities, net | $24 |
Foreign currency translation gain, net | 135 |
Accumulated other comprehensive income | $159 |
Stockholders_Equity_Schedule_o
Stockholders' Equity - Schedule of Deemed Capital Contribution (Distribution) (Detail) (USD $) | 10 Months Ended | 12 Months Ended | |||
Oct. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Mar. 31, 2013 | |
Stockholders Equity [Line Items] | |||||
SARs liability | ($19,970,000) | ($20,542,000) | ($20,000,000) | ||
Notes payable to former stockholders | -11,504,000 | ||||
Interest expense related to notes payable to former stockholders | -318,000 | ||||
Deferred taxes assets, net | 26,600,000 | 26,572,000 | |||
Deemed capital contribution in additional paid in capital | -3,291,000 | -3,291,000 | 4,209,000 | ||
Unvested restricted stock and SARs [Member] | |||||
Stockholders Equity [Line Items] | |||||
Compensation cost for unvested restricted stock and SARs, net of tax | 2,655,000 | 4,209,000 | |||
Notes Payable APIC [Member] | |||||
Stockholders Equity [Line Items] | |||||
Notes payable to former stockholders | ($12,230,000) |
StockBased_Compensation_Plans_1
Stock-Based Compensation Plans - Subsequent to the IPO - 2013 Omnibus Equity Incentive Plan - Award Limitations - Additional Information (Detail) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | |||||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Nov. 30, 2014 | Aug. 31, 2014 | 31-May-14 | Feb. 28, 2014 | Dec. 31, 2014 | Nov. 30, 2013 | Nov. 05, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based awards granted during the period | 216,411 | 14,222 | 18,820 | 61,655 | 38,088 | 349,196 | ||
IPO [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Common stock sold and issued under IPO, price per share | 12 | $12 | ||||||
2013 Omnibus Equity Incentive Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of active equity plans | 1 | |||||||
Common stock shares reserved for issuance of awards | 5,500,000 | 5,500,000 | ||||||
Common stock shares available for grant | 2,193,063 | 2,193,063 | ||||||
Common stock available for future issuance authorized annual percentage increase | 3.00% | |||||||
Increase of common stock share reserve approved | 1,100,000 | |||||||
Description of awards granted under the 2013 Plan | In November 2013, MMI issued the following equity awards under the 2013 Plan (i) DSUs for an aggregate of 2,192,413 shares granted as replacement awards related to the prior SARs program to the MMREIS managing directors, (ii) DSUs for 83,334 shares to be granted to the Company's Co-chairman of the board of directors (Mr. Millichap). The DSU's are fully vested and will be issued ratably over 5 years. In addition, 30,000 shares, in the form of RSAs, was granted to the Company's non-employee directors. The shares vest ratably over 3 years. All the above awards were granted based on the IPO price of $12.00. | |||||||
Deferred stock units [Member] | 2013 Omnibus Equity Incentive Plan [Member] | MMREIS Managing Directors [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Fully vested deferred stock units | 2,192,413 | 2,192,413 | ||||||
Deferred stock units [Member] | 2013 Omnibus Equity Incentive Plan [Member] | Millichap [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Fully vested deferred stock units | 83,334 | |||||||
Restricted Stock [Member] | Non-employee directors [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based awards granted during the period | 22,884 | 22,884 | 30,000 | |||||
Options & SARs [Member] | Minimum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share limitations to awards granted under the 2013 Plan | 500,000 | 500,000 | ||||||
Options & SARs [Member] | Maximum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share limitations to awards granted under the 2013 Plan | 1,000,000 | 1,000,000 | ||||||
Restricted Stock and RSUs [Member] | Minimum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share limitations to awards granted under the 2013 Plan | 500,000 | 500,000 | ||||||
Restricted Stock and RSUs [Member] | Maximum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share limitations to awards granted under the 2013 Plan | 1,000,000 | 1,000,000 | ||||||
Performance Shares [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of award limitation, performance units or performance shares | 1 | |||||||
Performance Shares [Member] | Minimum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share limitations to awards granted under the 2013 Plan | 500,000 | 500,000 | ||||||
Grant date fair value limitations to awards granted under the 2013 Plan | 2 | |||||||
Performance Shares [Member] | Maximum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share limitations to awards granted under the 2013 Plan | 1,000,000 | 1,000,000 | ||||||
Grant date fair value limitations to awards granted under the 2013 Plan | 5 |
StockBased_Compensation_Plans_2
Stock-Based Compensation Plans - Subsequent to the IPO - 2013 Omnibus Equity Incentive Plan - Additional Information (Detail) (USD $) | 1 Months Ended | 12 Months Ended | |||
Nov. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares outstanding under compensation plan | 750 | 3,500 | |||
Stock Based Compensation Expense [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock price used for measurement to FMV for RSU awards to independent contractors | 33.25 | $14.90 | |||
2013 Omnibus Equity Incentive Plan [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Deferred stock units, number of shares settled | 455,151 | ||||
Number of common stock shares withheld to pay employee statutory withholding taxes | 185,821 | ||||
2013 Omnibus Equity Incentive Plan [Member] | Options [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares issued under compensation plan | 0 | ||||
Number of shares outstanding under compensation plan | 0 | ||||
2013 Omnibus Equity Incentive Plan [Member] | Restricted Stock [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period for restricted stock awards and restricted stock units | 3 years | ||||
2013 Omnibus Equity Incentive Plan [Member] | Restricted Stock Units (RSUs) [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period for restricted stock awards and restricted stock units | 5 years | ||||
2013 Omnibus Equity Incentive Plan [Member] | SARs [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares issued under compensation plan | 0 | ||||
Number of shares outstanding under compensation plan | 0 | ||||
2013 Omnibus Equity Incentive Plan [Member] | Performance Shares [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares issued under compensation plan | 0 | ||||
Number of shares outstanding under compensation plan | 0 | ||||
2013 Omnibus Equity Incentive Plan [Member] | Deferred stock units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Fully vested deferred stock units remaining outstanding | 1,820,596 |
StockBased_Compensation_Outsta
Stock-Based Compensation - Outstanding Awards Under 2013 Omnibus Equity Incentive Plan (Detail) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | ||||
Dec. 31, 2014 | Nov. 30, 2014 | Aug. 31, 2014 | 31-May-14 | Feb. 28, 2014 | Dec. 31, 2014 | Nov. 30, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Outstanding, beginning balance, Shares | 913,915 | ||||||
Granted | 216,411 | 14,222 | 18,820 | 61,655 | 38,088 | 349,196 | |
Vested | -10,002 | ||||||
Forfeited/canceled | -46,100 | ||||||
Outstanding, ending balance, Shares | 1,207,009 | 1,207,009 | |||||
Unrecognized stock-based compensation expense as of December 31, 2014 | $27,175,000 | $27,175,000 | |||||
Unrecognized stock-based compensation expenses recognition period | 4 years 1 month 24 days | ||||||
Nonvested weighted average grant date fair value per share, beginning balance | $14.46 | ||||||
Weighted average grant date fair value per share, Granted | $27.46 | ||||||
Weighted average grant date fair value, Vested | $12 | ||||||
Weighted average grant date fair value, Transferred | $14.54 | ||||||
Weighted average grant date fair value, Forfeited/canceled | $14.65 | ||||||
Nonvested weighted average grant date fair value per share, ending balance | $18.23 | $18.23 | |||||
Restricted Stock [Member] | Non-employee directors [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Outstanding, beginning balance, Shares | 30,000 | ||||||
Granted | 22,884 | 22,884 | 30,000 | ||||
Vested | -10,002 | ||||||
Outstanding, ending balance, Shares | 42,882 | 42,882 | |||||
Unrecognized stock-based compensation expense as of December 31, 2014 | 503,000 | 503,000 | |||||
Unrecognized stock-based compensation expenses recognition period | 2 years 1 month 10 days | ||||||
Restricted Stock Units (RSUs) [Member] | Employees [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Outstanding, beginning balance, Shares | 313,155 | ||||||
Granted | 216,411 | 9,584 | 6,346 | 6,991 | 239,332 | ||
Transferred | -8,596 | ||||||
Forfeited/canceled | -27,454 | ||||||
Outstanding, ending balance, Shares | 516,437 | 516,437 | |||||
Unrecognized stock-based compensation expense as of December 31, 2014 | 10,126,000 | 10,126,000 | |||||
Unrecognized stock-based compensation expenses recognition period | 4 years 5 months 16 days | ||||||
Restricted Stock Units (RSUs) [Member] | Independent Contractors [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Outstanding, beginning balance, Shares | 570,760 | ||||||
Granted | 4,638 | 12,474 | 31,780 | 38,088 | 86,980 | ||
Transferred | 8,596 | ||||||
Forfeited/canceled | -18,646 | ||||||
Outstanding, ending balance, Shares | 647,690 | 647,690 | |||||
Unrecognized stock-based compensation expense as of December 31, 2014 | $16,546,000 | $16,546,000 | |||||
Unrecognized stock-based compensation expenses recognition period | 4 years 18 days |
StockBased_Compensation_Plans_3
Stock-Based Compensation Plans - Employee Stock Purchase Plan - Additional Information (Detail) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation expense | $27,175,000 |
Unrecognized stock-based compensation expenses recognition period | 4 years 1 month 24 days |
Employee Stock Purchase Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved and available for issuance | 366,667 |
Common stock shares available for issuance | 341,356 |
Common stock available for future issuance authorized annual share increase | 366,667 |
Common stock available for future issuance authorized annual percentage increase | 1.00% |
ESPP offering period description | The offering periods generally start on the first trading day on or after May 15 and November 15 of each year. The first offering period began on May 15, 2014. |
Length of purchase intervals | 6 months |
Expected dividend yield | 0.00% |
Forfeiture rate | 0.00% |
Unrecognized stock-based compensation expense | $93,000 |
Unrecognized stock-based compensation expenses recognition period | 4 months 13 days |
StockBased_Compensation_Plans_4
Stock-Based Compensation Plans - Pre-IPO - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized stock-based compensation expenses recognition period | 4 years 1 month 24 days | ||
Notes receivable from employees [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Notes issued, interest rate | 5.00% | ||
Notes issued, interest rate | 6.00% | ||
Notes issued, payment date | 15-Apr-16 | ||
Pre-IPO [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of stock option redemption or cancelations | 0 | 0 | |
Unrecognized stock-based compensation expenses recognition period | 4 years | ||
Pre-IPO [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted common stock issued, vesting period | 3 years | ||
Pre-IPO [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted common stock issued, vesting period | 5 years | ||
Restricted Common Stock [Member] | Pre-IPO [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Terms of Issued Options | One year or less |
StockBased_Compensation_Plans_5
Stock-Based Compensation Plans - Summary of Stock Option Activity - Pre-IPO (Detail) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Shares Under Options, beginning of year | 750 | 3,500 |
Shares Under Options, Granted | 750 | |
Shares Under Options, Exercised | -750 | -3,500 |
Shares Under Options, end of year | 750 | |
Weighted-Average Exercise Price, beginning of year | $28.86 | $25.67 |
Weighted-Average Exercise Price, Granted | $28.86 | |
Weighted-Average Exercise Price, Exercised | $28.86 | $25.67 |
Weighted-Average Exercise Price, end of year | $28.86 |
StockBased_Compensation_Plans_6
Stock-Based Compensation Plans - Summary of Restricted Common Stock Activity - Pre-IPO (Detail) (USD $) | 1 Months Ended | 12 Months Ended | 10 Months Ended | 12 Months Ended | |||||
Dec. 31, 2014 | Nov. 30, 2014 | Aug. 31, 2014 | 31-May-14 | Feb. 28, 2014 | Dec. 31, 2014 | Oct. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Outstanding, beginning balance, Shares | 913,915 | ||||||||
Issued upon exercise of stock options | 216,411 | 14,222 | 18,820 | 61,655 | 38,088 | 349,196 | |||
Outstanding, ending balance, Shares | 1,207,009 | 1,207,009 | |||||||
Nonvested weighted average grant date fair value per share, beginning balance | $14.46 | ||||||||
Nonvested weighted average grant date fair value per share, ending balance | $18.23 | $18.23 | |||||||
MMREIS Common Stock [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Exchange of common stock | 234,489 | 234,489 | |||||||
MMREIS Common Stock [Member] | MMREIS Managing Directors [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Exchange of common stock | 28,749 | ||||||||
Restricted Common Stock [Member] | Pre-IPO [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Outstanding, beginning balance, Shares | 27,999 | 24,499 | 27,999 | ||||||
Issued upon exercise of stock options | 3,500 | 750 | |||||||
Outstanding, ending balance, Shares | 27,999 | ||||||||
Restricted common stock vested ending balance, Shares | 22,682 | ||||||||
Restricted common stock unvested ending balance, Shares | 5,317 | ||||||||
Nonvested weighted average grant date fair value per share, beginning balance | 23.67 | 23.36 | $23.67 | ||||||
Issued/Granted, Weighted-Average Grant Date Fair Value | 25.87 | $28.86 | |||||||
Exchange of common stock, Weighted-Average Grant Date Fair Value | 0 | $0 | |||||||
Nonvested weighted average grant date fair value per share, ending balance | 23.67 | ||||||||
Restricted Common Stock [Member] | Pre-IPO [Member] | MMREIS Common Stock [Member] | MMREIS Managing Directors [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Exchange of common stock | -28,749 |
StockBased_Compensation_Plans_7
Stock-Based Compensation Plans - Summary of SARs Activity - Pre-IPO (Detail) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Outstanding, beginning balance, Shares | 1,207,009 | ||
Outstanding, ending balance, Shares | 913,915 | 1,207,009 | |
SARs [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Outstanding, beginning balance, Shares | 28,733 | 27,983 | |
Granted | 750 | ||
Settled | -28,733 | ||
Outstanding, ending balance, Shares | 28,733 | ||
Outstanding, ending balance, Shares | 22,666 |
StockBased_Compensation_Plans_8
Stock-Based Compensation Plans - Summary of SARs Activity - Pre-IPO (Parenthetical) (Detail) (Deferred stock units [Member], MMREIS Managing Directors [Member], 2013 Omnibus Equity Incentive Plan [Member]) | 1 Months Ended | 12 Months Ended |
Nov. 30, 2013 | Dec. 31, 2014 | |
Deferred stock units [Member] | MMREIS Managing Directors [Member] | 2013 Omnibus Equity Incentive Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Fully vested deferred stock units | 2,192,413 | 2,192,413 |
StockBased_Compensation_Additi
Stock-Based Compensation - Additional Information (Detail) (USD $) | 3 Months Ended | 10 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Oct. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2014 |
Age | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation charges | $30,900 | $30,886 | $30,886 | |
Deferred stock units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
DSU settlement to common stock percentage | 20.00% | |||
DSU settlement into actual stock issued term | 5 years | |||
Employee termination age | 67 | |||
Percentage of deferred stock units settled | 100.00% | |||
Percentage of shares of deferred stock units released from resale restriction in the event of death or termination after reaching age 67 | 100.00% | |||
Restricted Stock [Member] | Sales Restricted [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Sales restriction lapse percentage for restricted stock | 20.00% | |||
Sales restriction period for restricted stock | 5 years | |||
Employee termination age | 67 | |||
Percentage of shares of stock released from resale restriction upon consummation of change of control | 100.00% | |||
Percentage of shares of restricted released from resale restriction in the event of death or termination after reaching age 67 | 100.00% |
StockBased_Compensation_Compon
Stock-Based Compensation - Components of Stock-Based Compensation Included in Consolidated Statements of Net and Comprehensive Income (Detail) (USD $) | 3 Months Ended | 10 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Oct. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock based compensation in connection with IPO | $30,900 | $30,886 | $30,886 | ||
Share-based compensation expense - Independent contractors | 3,892 | 168 | |||
Allocated share-based compensation expense | 5,034 | 35,841 | 7,448 | ||
Restricted stock and SARs (prior to IPO) [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Allocated share-based compensation expense | 4,679 | 7,448 | |||
Employee Stock Purchase Plan [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Allocated share-based compensation expense | 128 | ||||
Restricted Stock [Member] | Non-employee directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Allocated share-based compensation expense | 197 | 20 | |||
Restricted Stock Units (RSUs) [Member] | Employees [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Allocated share-based compensation expense | $817 | $88 |
Income_Taxes_Schedule_of_Provi
Income Taxes - Schedule of Provision for Income Taxes (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Federal: | |||
Current | $28,452 | $20,245 | $18,866 |
Deferred | -566 | -8,077 | |
Provision for Income Taxes, Federal | 27,886 | 12,168 | 18,866 |
State: | |||
Current | 4,123 | 2,522 | 2,641 |
Deferred | 1,443 | -1,199 | |
Provision for Income Taxes, State | 5,566 | 1,323 | 2,641 |
Foreign: | |||
Current | 244 | ||
Deferred | 0 | 0 | 0 |
Provision for Income Taxes, Foreign | 244 | ||
Provision for income taxes | $33,452 | $13,735 | $21,507 |
Income_Taxes_Significant_Compo
Income Taxes - Significant Components of Deferred Tax Assets (Liabilities), Net (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Deferred Tax Assets, Net Current: | ||
Accrued expenses and bonuses | $5,435 | $5,668 |
Bad debt and other reserves | 2,009 | 1,290 |
Deferred compensation | 2,796 | 2,325 |
Stock compensation | 4,205 | 369 |
Deferred rent | 324 | 335 |
Prepaid expenses | -1,392 | -915 |
State taxes | 250 | -389 |
Current deferred tax assets, net before valuation allowance | 13,627 | 8,683 |
Valuation allowance | -27 | -20 |
Current deferred tax assets, net | 13,600 | 8,663 |
Non-current: | ||
Fixed assets and leasehold improvements | 203 | 427 |
Litigation reserve | 887 | |
Deferred compensation | 6,076 | 6,396 |
Stock compensation | 15,502 | 19,151 |
Deferred Rent | 997 | 1,259 |
Other comprehensive income | -113 | |
Unrealized gain on foreign currency | 56 | |
Net operating loss carryforwards | 680 | 1,544 |
State taxes | -1,435 | -2,213 |
Non-current deferred tax assets, net before valuation allowance | 21,966 | 27,451 |
Valuation allowance | -701 | -266 |
Non-Current deferred tax assets, net | $21,265 | $27,185 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | ||
Oct. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income Taxes [Line Items] | ||||
State and Canadian net operating losses (NOLs) | 3,500,000 | |||
State and Canadian net operating losses (NOLs), expiration year | 2019 | |||
Valuation allowance, deferred tax assets | 728,000 | 286,000 | ||
Change in valuation allowance, deferred tax assets | 442,000 | |||
Tax computed at federal rate, percentage | 35.00% | 35.00% | 35.00% | |
Reduction to income tax payable | -6,900,000 | |||
Tax benefit related to settlement of DSUs, RSAs and IPO transaction costs | 5,200,000 | |||
Uncertain tax positions | 0 | 0 | ||
Income Tax Examination, Description | The Company is not currently under income tax examination by any taxing authorities. | |||
Undistributed earnings of foreign subsidiary | 0 | |||
Tax sharing agreement termination date | 31-Oct-13 | |||
Deferred tax assets, net transferred from parent prior to IPO | 26,600,000 | 26,572,000 | ||
Minimum [Member] | ||||
Income Taxes [Line Items] | ||||
Open tax years subject to tax examinations | 2009 | |||
Maximum [Member] | ||||
Income Taxes [Line Items] | ||||
Open tax years subject to tax examinations | 2014 | |||
Tax-sharing agreement [Member] | ||||
Income Taxes [Line Items] | ||||
Effective income tax rate, pre-IPO | 43.50% | 43.50% | 43.50% | |
Tax sharing agreement termination date | 31-Oct-13 |
Income_Taxes_Components_of_Pro
Income Taxes - Components of Provision for Income Taxes and Income before Provision for Income Taxes (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Provision Benefit For Income Taxes [Line Items] | |||
Income tax expense at the federal statutory rate of 35% | $29,044 | $7,679 | $17,305 |
State income tax expenses, net of federal benefit | 3,622 | 985 | 2,423 |
Permanent difference related to compensation charges | 163 | 3,445 | |
Other | 181 | 361 | 8 |
Change in valuation allowance | 442 | ||
Provision for income taxes | 33,452 | 13,735 | 21,507 |
Tax-sharing agreement [Member] | |||
Provision Benefit For Income Taxes [Line Items] | |||
Differences due to tax-sharing agreement | $1,265 | $1,771 |
Retirement_Plans_Additional_In
Retirement Plans - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Defined contribution plan, new plan effective date | 2014-01 | ||
Retirement Plans [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined contribution plan minimum eligible period | Have completed one month of service and have reached age 21. | ||
Defined contribution plan, maximum percentage of employee contribution | 100.00% | ||
Defined contribution plan, percentage of employer matching contribution percent of match | 50.00% | ||
Defined contribution plan, employer contribution percentage | 4.00% | ||
Defined contribution plan, maximum annual employer contribution per employee | $4,000 | ||
Defined contribution plan, matching contributions aggregated | $429,000 | $321,000 | $0 |
Earnings_Per_Share_Computation
Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Detail) (USD $) | 2 Months Ended | 3 Months Ended | 12 Months Ended | |||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Numerator (Basic and Diluted): | ||||||||||
Net income attributable to Marcus & Millichap, Inc. | $9,251 | $16,430 | $13,523 | $12,796 | $6,782 | $9,251 | $49,531 | $9,251 | ||
Denominator: | ||||||||||
Weighted average common shares issued and outstanding | 36,541 | 36,660 | ||||||||
Deduct: Unvested RSAs | -30 | -43 | ||||||||
Add: Fully vested DSUs | 2,276 | 2,234 | ||||||||
Weighted Average Common Shares Outstanding | 38,787 | 38,851 | [1] | 38,787 | [1] | |||||
Basic earnings per common share | $0.24 | $0.42 | $0.35 | $0.33 | $0.17 | $0.24 | $1.27 | [1] | $0.24 | [1] |
Weighted Average Common Shares Outstanding from above | 38,787 | 38,851 | [1] | 38,787 | [1] | |||||
Add: Dilutive effect of RSUs, RSAs & ESPP | 28 | 127 | ||||||||
Weighted Average Common Shares Outstanding | 38,815 | 38,978 | [1] | 38,815 | [1] | |||||
Diluted earnings per common share | $0.24 | $0.42 | $0.35 | $0.33 | $0.17 | $0.24 | $1.27 | [1] | $0.24 | [1] |
[1] | Earnings per share (EPS) for the twelve months ended December 31, 2013 represents EPS attributable to Marcus & Millichap, Inc. subsequent to its initial public offering on October 31, 2013. EPS information for periods prior to the initial public offering were not meaningful. |
Earnings_Per_Share_Computation1
Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Parenthetical) (Detail) (Restricted Stock [Member], Non-employee directors [Member]) | 12 Months Ended |
Dec. 31, 2014 | |
Restricted Stock [Member] | Non-employee directors [Member] | |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |
Restricted common stock issued, vesting period | 3 years |
Earnings_Per_Share_Additional_
Earnings Per Share - Additional Information (Detail) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Earnings Per Share [Abstract] | ||
Antidilutive securities excluded from computation of diluted earnings per common share | 817,000 | 0 |
Commitments_and_Contingencies_1
Commitments and Contingencies - Schedule of Future Minimum Lease Payments for Operating Leases (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Commitments and Contingencies Disclosure [Abstract] | |
2015 | $13,144 |
2016 | 10,198 |
2017 | 7,535 |
2018 | 5,995 |
2019 | 3,338 |
Thereafter | 5,658 |
Operating Leases, Future Minimum Payments Due, Total | $45,868 |
Commitments_and_Contingencies_2
Commitments and Contingencies - Additional Information Operating Leases (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Commitments and Contingencies Disclosure [Abstract] | |||
Deferred rent | $3.10 | $3.70 | |
Rental expense | $16.70 | $15.70 | $14.50 |
Commitments_and_Contingencies_3
Commitments and Contingencies - Additional Information Credit Agreement (Detail) (USD $) | 0 Months Ended | 12 Months Ended | ||
Jan. 02, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Ratio | ||||
Line of Credit Facility [Line Items] | ||||
Senior secured revolving credit facility maximum borrowing capacity | $60,000,000 | |||
Revolving credit facility maturity date | 1-Jun-17 | |||
Bank fees and other expenses | 224,000 | |||
Credit agreement, unused capacity, commitment fee percentage | 0.10% | |||
Commitment fee commencement date | 1-Jul-14 | |||
Date the Company entered into a Credit Agreement | 18-Jun-14 | |||
Credit agreement date | 1-Jun-14 | |||
Interest expense | 1,651,000 | 105,000 | 4,000 | |
Credit agreement, amount outstanding | 0 | |||
Standby letters of credit borrowing capacity | 10,000,000 | |||
Credit facility interest rate description | Credit Facility will bear interest, at the Company's option, at either the (i) Base Rate (defined as the highest of (a) the Bank's prime rate, (b) the Federal Funds Rate plus 1.5% and (c) one-month LIBOR plus 1.5%), or (ii) at a variable rate between 0.875% and 1.125% above LIBOR, based upon the total funded debt to EBITDA ratio. | |||
Base spread on variable rate | 2.00% | |||
LIBOR rate duration period | 1 month | |||
Credit facility covenants | (i) an EBITDAR Coverage Ratio (as defined in the Credit Agreement) of not less than 1.251.0 as of each quarter end on a rolling 4-quarter basis and (ii) total funded debt to EBITDA not greater than 2.01.0 | |||
Minimum EBITDAR coverage ratio | 1.25 | |||
Maximum Total Funded Debt to EBITDA ratio | 2 | |||
Credit agreement, pledge percentage | 100.00% | |||
Compliance description | As of December 31, 2014, the Company was in compliance with all financial and non-financial covenants. | |||
London Interbank Offered Rate (LIBOR) [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Base spread on variable rate | 1.50% | |||
Credit Agreement [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Interest expense | $76,000 | |||
Federal Funds Rate [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Base spread on variable rate | 1.50% | |||
Minimum [Member] | Variable Rate [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Base spread on variable rate | 0.88% | |||
Maximum [Member] | Variable Rate [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Base spread on variable rate | 1.13% |
Selected_Quarterly_Financial_D2
Selected Quarterly Financial Data - Schedule of Quarterly Financial Data (Detail) (USD $) | 2 Months Ended | 3 Months Ended | 10 Months Ended | 12 Months Ended | |||||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Oct. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||
Consolidated Financial Statement Data: | |||||||||||||||
Total revenues | $172,444 | $150,889 | $134,265 | $114,590 | $149,101 | $111,953 | $105,471 | $69,370 | $572,188 | $435,895 | $385,716 | ||||
Cost of services | 109,836 | 92,269 | 79,601 | 68,396 | 94,242 | 67,718 | 61,456 | 41,221 | 350,102 | 264,637 | 230,248 | ||||
Operating income (loss) | 27,097 | 23,721 | 21,726 | 12,062 | -8,165 | 12,625 | 14,169 | 2,657 | 84,606 | 21,286 | 49,008 | ||||
Net income (loss) | 16,430 | 13,523 | 12,796 | 6,782 | -8,716 | 7,275 | 8,009 | 1,638 | 49,531 | 8,206 | 27,934 | ||||
Net (loss) income (attributable to MMREIS prior to IPO on October 31, 2013) | -17,967 | 7,275 | 8,009 | 1,638 | -1,045 | -1,045 | 27,934 | ||||||||
Net income attributable to Marcus & Millichap, Inc. subsequent to IPO on October 31, 2013 | $9,251 | $16,430 | $13,523 | $12,796 | $6,782 | $9,251 | $49,531 | $9,251 | |||||||
Earnings per share: | |||||||||||||||
Basic | $0.24 | $0.42 | $0.35 | $0.33 | $0.17 | $0.24 | $1.27 | [1] | $0.24 | [1] | |||||
Diluted | $0.24 | $0.42 | $0.35 | $0.33 | $0.17 | $0.24 | $1.27 | [1] | $0.24 | [1] | |||||
[1] | Earnings per share (EPS) for the twelve months ended December 31, 2013 represents EPS attributable to Marcus & Millichap, Inc. subsequent to its initial public offering on October 31, 2013. EPS information for periods prior to the initial public offering were not meaningful. |
Selected_Quarterly_Financial_D3
Selected Quarterly Financial Data - Schedule of Quarterly Financial Data (Parenthetical) (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2013 |
Income Statement [Abstract] | ||
Stock-based and other compensation in connection with IPO | $31,300 | $31,268 |