Marketable Securities

3 Months Ended

Mar. 31, 2018

Investments All Other Investments [Abstract]

(6)	Marketable Securities

On June 28, 2013, BGC sold certain assets of its on-the-run, electronic benchmark U.S. Treasury platform (“eSpeed”) to Nasdaq. The total consideration received in the transaction included an earn-out of up to 14,883,705 shares of Nasdaq common stock to be paid ratably over 15 years, provided that Nasdaq, as a whole, produces at least $25.0 million in consolidated gross revenues each year. The earn-out was excluded from the initial gain on the divestiture and is recognized in income as it is realized and earned when these contingent events have occurred, consistent with the accounting guidance for gain contingencies (the “Nasdaq Earn-Out”). The remaining rights under the Nasdaq Earn-Out were transferred to Newmark on September 28, 2017. Any Nasdaq shares that were received by BGC prior to September 28, 2017 were not transferred to Newmark.

In connection with the Nasdaq Earn-Out, Newmark received 992,247 shares during the year ended December 31, 2017. Newmark will receive a remaining Earn-Out of up to 9,922,470 shares of Nasdaq common stock ratably over the next approximately 10 years, provided that Nasdaq, as a whole, produces at least $25.0 million in gross revenues each year. During the three months ended March 31, 2018, Newmark sold 650,000 shares of the Nasdaq shares received. In November of 2017, Newmark sold 242,247 shares and has 100,000 remaining shares as of March 31, 2018. During the three months ended March 31, 2018, the market value of the securities sold was $52.2 million. For the three months ended March 31, 2018, Newmark recognized a gain on the sale of these securities of $2.4 million. For the three months ended March 31, 2018, Newmark also recorded an unrealized gain of $0.8 million on the mark to market of these securities, which is included in “Other income, net” in Newmark’s unaudited condensed consolidated statement of operations. As of March 31, 2018 and December 31, 2017, Newmark had $8.6 million and $57.6 million, respectively included in “Marketable securities” on its unaudited condensed consolidated balance sheet (see Note 18—Securities Loans)