NEWMARK : MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-K)

The following discussion of Newmark's financial condition and results of
operations should be read together with Newmark's accompanying consolidated
financial statements and related notes, as well as the caution "Special Note
Regarding Forward-Looking Information" relating to forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), included in this report. When used herein, the
terms "Newmark," the "Company," "we," "us," and "our" refer to Newmark and its
consolidated subsidiaries.

This discussion summarizes the significant factors affecting our results of
operations and financial condition during the years ended December 31, 2020,
2019 and 2018. We operate in one reportable segment, real estate services. This
discussion is provided to increase the understanding of, and should be read in
conjunction with, our accompanying consolidated financial statements and the
notes thereto included elsewhere in this report.

Forward-Looking Cautionary Statements

Our actual results and the outcome and timing of certain events may differ
significantly from the expectations discussed in the forward-looking statements.
Factors that might cause or contribute to such a discrepancy include, but are
not limited to, the factors set forth below:
•macroeconomic and other challenges and uncertainties resulting from the
COVID-19 pandemic, including any successive waves or variants of the virus, or
the emergence of another pandemic, and governmental measures taken in response
thereto, such as the extent and duration of the impact on public health,
including complications in the implementation of vaccination programs, public
acceptance of the vaccine, the impact on the economy, the commercial real estate
services industry and the global financial markets, and consumer and corporate
clients and customers, including the effect on demand for commercial real estate
including office space, levels of new lease activity and renewals, frequency of
loan defaults and forbearance, and fluctuations in the mortgage-backed
securities market;
•challenges relating to our repositioning of certain aspects of our business to
adapt to and better address the needs of our clients in the future as a result
of the acceleration of pre-existing long-term social and economic trends, or
emergence of new trends resulting from the COVID-19 pandemic and governmental
measures taken in response thereto, including changes in the mix of demand for
commercial real estate space, including decreased demand for urban office and
retail space generally, which may be offset in whole or in part by increased
demand for suburban office, data storage, fulfillment, and distribution centers
and life sciences facilities, that could materially reduce demand for commercial
space and have a material adverse effect on the nature of and demand for our
commercial real estate services, including the time and expense related to such
repositioning, as well as risks related to our entry into new geographic markets
or lines of business;
•the impact of the coronavirus (COVID-19) pandemic, including any successive
waves or variants of the virus, on our operations, including the continued
ability of our executives, employees, clients and third-party service providers
to perform their functions at normal levels, as well as the cybersecurity risks
of remote working, and our ability to continue providing on-site commercial
property management services;
•market conditions, transaction volumes, possible disruptions in transactions,
potential deterioration of equity and debt capital markets for commercial real
estate and related services, impact of significant changes in interest rates and
our ability to access the capital markets as needed or on reasonable terms and
conditions;
•pricing, commissions and fees, and market position with respect to any of our
products and services and those of our competitors;
•the effect of industry concentration and reorganization, reduction of customers
and consolidation;
•uncertainties related to the bankruptcy of Knotel, Inc. ("Knotel") and our
proposed acquisition of certain assets thereof in the bankruptcy proceedings,
including that we may not be able to complete such proposed acquisition or
realize the expected benefits therefrom, the potential for the expenditure of
substantial expense and diversion of management's attention and resources, and
the potential, if such proposed acquisition is not completed, that the
bankruptcy may adversely affect our ability to be paid in full on the debt that
we own in Knotel;
•liquidity, regulatory requirements and the impact of credit market events,
including the impact of COVID-19 and actions taken by governments and businesses
in responses thereto on the credit markets and interest rates;
•our relationship and transactions with Cantor Fitzgerald, L.P. ("Cantor") and
its affiliates, Newmark's structure, including Newmark Holdings, L.P. ("Newmark
Holdings"), which is owned by Newmark, Cantor, Newmark's employee partners and
other partners, and our operating partnership, which is owned jointly by us and
Newmark
                                       61
--------------------------------------------------------------------------------

Holdings (which we refer to as "Newmark OpCo" ) any related transactions,
conflicts of interest, or litigation, any loans to or from Newmark or Cantor,
Newmark Holdings or Newmark OpCo, including the balances and interest rates
thereof from time to time and any convertible or equity features of any such
loans, competition for and retention of brokers and other managers and key
employees;
•the impact on our stock price from the reduction of our dividend and potential
future changes in our dividend policy and in Newmark Holdings distributions to
partners and the related impact of such reductions, as well as the effect of
layoffs, furloughs, salary cuts, and expected lower commissions or bonuses on
the repayment of partner loans;
•market volatility as a result of the effects of COVID-19, which may not be
sustainable or predictable in future periods;
•our ability to grow in other geographic regions and to manage our recent
overseas growth and the impact of the COVID-19 pandemic on these regions and
transactions;
•our ability to maintain or develop relationships with independently owned
offices or affiliated businesses or partners in our business;
•the impact of any restructuring or similar transaction on our business and
financial results in current or future periods, including with respect to any
assumed liabilities or indemnification obligations with respect to such
transactions, the integration of any completed acquisitions and the use of
proceeds of any completed dispositions;
•the integration of acquired businesses with our business;
•the timing of receipt by us of the remaining Nasdaq shares that we expect to
receive, including tax considerations and regulatory restrictions on our ability
to receive, hold, pledge, hedge or sell the Nasdaq shares;
•the rebranding which was announced in October 2020 of our current businesses
from "Newmark Knight Frank" to "Newmark" or risks related to any potential
dispositions of all or any portion of our existing or acquired businesses;
•risks related to changes in our relationships with the Government Sponsored
Enterprises ("GSEs") and Housing and Urban Development ("HUD"), including the
impact of COVID-19 and related changes in the credit markets, changes in
prevailing interest rates and the risk of loss in connection with loan defaults;
•risks related to changes in the future of the GSEs, including changes in the
terms of applicable conservatorships and changes in their capabilities;
•economic or geopolitical conditions or uncertainties, the actions of
governments or central banks, including the impact of COVID-19 on the global
markets, and related government stimulus packages, government "shelter-in-
place" orders and other restrictions on business and commercial activity and
timing of reopening of local, national, and world economies, uncertainty
regarding the nature, timing and consequences of the United Kingdom ("U.K.")'s
exit from the European Union ("EU") following the withdrawal process, including
potential reduction in investment in the U.K., and the pursuit of trade, border
control or other related policies by the U.S. and/or other countries (including
U.S. - China trade relations), political and civil unrest in the U.S., including
demonstrations, riots, rising tensions with law enforcement, the impact of the
recent U.S. Presidential and Congressional elections, response to governmental
mandates and other restrictions related to COVID-19 in the U.S. or abroad, risks
of illness of the U.S. President and other governmental officials, political and
labor unrest in France, Hong Kong, China and other jurisdictions, conflict in
the Middle East, the impact of U.S. government shutdowns or impasses, the impact
of terrorist acts, acts of war or other violence or political unrest, as well as
natural disasters or weather-related or similar events, including hurricanes as
well as power failures, communication and transportation disruptions, and other
interruptions of utilities or other essential services, and the impact of
pandemics and other international health incidents, including COVID-19;
•the effect on our business, clients, the markets in which we operate, and the
economy in general of changes in the U.S. and foreign tax and other laws,
including changes in tax rates, repatriation rules, and deductibility of
interest, potential policy and regulatory changes in Mexico and other countries,
sequestrations, uncertainties regarding the debt ceiling and the federal budget,
and future changes to tax policy and other potential political policies
resulting from elections and changes in governments;
•our dependence upon our key employees and our ability to attract, retain,
motivate and integrate new employees, as well as the competing demands on the
time of certain of our executive officers who also provide services to Cantor,
BGC and various other ventures and investments sponsored by Cantor;
•the effect on our business of changes in interest rates, changes in benchmarks,
including the phase out of the London Interbank Offering Rate ("LIBOR") and the
transition to alternative benchmarks, the level of worldwide governmental debt
issuances, austerity programs, government stimulus packages, including those
related to COVID-19, increases or decreases in deficits and the impact of
increased government tax rates, and other changes
                                       62
--------------------------------------------------------------------------------

to monetary policy, and potential political impasses or regulatory requirements,
including increased capital requirements for banks and other institutions or
changes in legislation, regulations and priorities;
•extensive regulation of our business and clients, changes in regulations
relating to commercial real estate and other industries, and risks relating to
compliance matters, including regulatory examinations, inspections,
investigations and enforcement actions, and any resulting costs, increased
financial and capital requirements, enhanced oversight, remediation, fines,
penalties, sanctions, and changes to or restrictions or limitations on specific
activities, operations, compensatory arrangements, and growth opportunities,
including acquisitions, hiring, and new businesses, products, or services, as
well as risks related to our taking actions to ensure that we and Newmark
Holdings are not deemed investment companies under the Investment Company Act of
1940;
•the impact of illness or governmental actions preventing a significant portion
of our workforce or the workforce of our clients or third-party vendors from
performing functions that can only be conducted in-person, including on-site
tours and inspections of buildings;
•factors related to specific transactions or series of transactions as well as
counterparty failure;
•costs and expenses of developing, maintaining and protecting our intellectual
property, as well as employment, regulatory, and other litigation, proceedings
and their related costs, including related to acquisitions and other matters,
including judgments, fines, or settlements paid, reputational risk, and the
impact thereof on our financial results and cash flow in any given period;
•our ability to maintain continued access to credit and availability of
financing necessary to support our ongoing business needs, including to
refinance indebtedness, and the risks associated with the resulting leverage, as
well as fluctuations in interest rates;
•certain other financial risks, including the possibility of future losses,
indemnification obligations, assumed liabilities, reduced cash flows from
operations, increased leverage, reduced availability under our Credit Facility
resulting from recent borrowings, and the need for short or long-term
borrowings, including from Cantor, the ability of Newmark to refinance its
indebtedness, including in the credit markets weakened by the impact of COVID-19
and our ability to satisfy eligibility criteria for government-sponsored loan
programs and changes to interest rates and market liquidity or our access to
other sources of cash relating to acquisitions, dispositions, or other matters,
potential liquidity and other risks relating to our ability to maintain
continued access to credit and availability of financing necessary to support
ongoing business needs on terms acceptable to us, if at all, and risks
associated with the resulting leverage, including potentially causing a
reduction in credit ratings and the associated outlooks and increased borrowing
costs as well as interest rate and foreign currency exchange rate fluctuations;
•risks associated with the temporary or longer-term investment of our available
cash, including in Newmark OpCo, defaults or impairments on the Company's
investments (including investments in non-marketable securities), joint venture
interests, stock loans or cash management vehicles and collectability of loan
balances owed to us by partners, employees, Newmark OpCo or others;
•the impact of any reduction in the willingness of commercial property owners to
outsource their property management needs;
•our ability to enter new markets or develop new products or services and to
induce clients to use these products or services and to secure and maintain
market share, and the impact of COVID-19 generally and on the commercial real
estate services business in particular;
•our ability to enter into marketing and strategic alliances, business
combinations, restructuring, rebranding or other transactions, including
acquisitions, dispositions, reorganizations, partnering opportunities and joint
ventures, the anticipated benefits of any such transactions, relationships or
growth and the future impact of any such transactions, relationships or growth
on other businesses and financial results for current or future periods, the
integration of any completed acquisitions and the use of proceeds of any
completed dispositions, the impact of amendments and/or terminations of any
strategic arrangements, and the value of any hedging entered into in connection
with consideration received or to be received in connection with such
dispositions and any transfers thereof;
•our estimates or determinations of potential value with respect to various
assets or portions of the Company's business, including with respect to the
accuracy of the assumptions or the valuation models or multiples used;
•the impact of layoffs, furloughs, near- or off-shoring or compensation
reductions on our business, including on our ability to hire and retain
personnel, including brokerage professionals, salespeople, managers, and other
professionals;
•our ability to effectively manage any growth that may be achieved, including
outside of the U.S., while ensuring compliance with all applicable financial
reporting, internal control, legal compliance, and regulatory requirements;
                                       63
--------------------------------------------------------------------------------

•our ability to identify and remediate any material weaknesses in internal
controls that could affect the ability to properly maintain books and records,
prepare financial statements and reports in a timely manner, control policies,
practices and procedures, operations and assets, assess and manage the Company's
operational, regulatory and financial risks, and integrate acquired businesses
and brokers, salespeople, managers and other professionals;
•the impact of unexpected market moves and similar events;
•information technology risks, including capacity constraints, failures, or
disruptions in our systems or those of clients, counterparties, or other parties
with which we interact, increased demands on such systems and on the
telecommunications infrastructure from remote working during the COVID-19
pandemic, including cyber-security risks and incidents, compliance with
regulations requiring data minimization and protection and preservation of
records of access and transfers of data, privacy risk and exposure to potential
liability and regulatory focus;
•the impact of our recent significant reductions to our dividends and
distributions and the timing and amounts of any future dividends or
distributions and our increased stock and unit repurchase authorization,
including our ability to meet expectations with respect to payment of dividends
and repurchases of common stock or purchases of Newmark Holdings limited
partnership interests or other equity interests in subsidiaries, including
Newmark OpCo, including from Cantor or our executive officers, other employees,
partners and others and the effect on the market for and trading price of our
Class A common stock as a result of any such transactions;
•the effectiveness of our governance, risks management, and oversight procedures
and the impact of any potential transactions or relationships with related
parties;
•the impact of our environmental, social and governance ("ESG") or
"sustainability" ratings on the decisions by clients, investors, potential
clients and other parties with respect to our business, investments in us or the
market for and trading price of Newmark Class A common stock or other matters;
•the fact that the prices at which shares of our Class A common stock are or may
be sold in offerings or other transactions may vary significantly, and
purchasers of shares in such offerings or other transactions, as well as
existing stockholders, may suffer significant dilution if the price they paid
for their shares is higher than the price paid by other purchasers in such
offerings or transactions;
•the effect on the markets for and trading prices of our Class A common stock
due to COVID-19 and other market factors, as well as on various offerings and
other transactions, including offerings of Class A common stock and convertible
or exchangeable debt or other securities, repurchases of shares of Class A
common stock and purchases or redemptions of Newmark Holdings limited
partnership interests or other equity interests in us or its subsidiaries, any
exchanges by Cantor of shares of Class A common stock for shares of Class B
common stock, any exchanges or redemptions of limited partnership units and
issuances of shares of Class A common stock in connection therewith, including
in corporate or partnership restructurings, payment of dividends on Class A
common stock and distributions on limited partnership interests of Newmark
Holdings and Newmark OpCo, convertible arbitrage, hedging, and other
transactions engaged in by us or holders of outstanding shares, debt or other
securities, share sales and stock pledge, stock loans, and other financing
transactions by holders of shares or units (including by Cantor executive
officers, partners, employees or others), including of shares acquired pursuant
to employee benefit plans, unit exchanges and redemptions, corporate or
partnership restructurings, acquisitions, conversions of shares of our Class B
common stock and other convertible securities into shares of our Class A common
stock, stock pledge, stock loans, or other financing transactions, distributions
of our Class A common stock by Cantor to its partners, including deferred
distribution rights shares;
•the effect of any potential conversion of BGC's partnership into a corporation
on Newmark, including but not limited to, impacts on Newmark's employees holding
BGC Holdings units and on our financial statements; and
•other factors, including those that are discussed under "Risk Factors," to the
extent applicable.

The foregoing risks and uncertainties, as well as those risks and uncertainties
discussed under the headings "Item 1A-Risk Factors," and "Item 7A-Quantitative
and Qualitative Disclosures About Market Risk" and elsewhere in this Form 10-K,
may cause actual results and events to differ materially from the
forward-looking statements..

Overview

Newmark is a full-service commercial real estate services business. We offer a
diverse array of integrated services and products designed to meet the full
needs of both real estate investors/owners and occupiers. Our investor/owner
services and products include capital markets, which consists of investment
sales, debt and structured finance and loan sales, agency leasing, property
management, valuation and advisory, commercial real estate due diligence
consulting and advisory services and government sponsored enterprise ("GSE")
lending and loan servicing, mortgage broking and equity-raising. Our occupier
services and products include tenant representation, real estate management
technology systems, workplace and occupancy strategy, global corporate
consulting services, project management, lease administration and facilities
management. We
                                       64
--------------------------------------------------------------------------------

enhance these services and products through innovative real estate technology
solutions and data analytics that enable our clients to increase their
efficiency and profits by optimizing their real estate portfolio. We have
relationships with many of the world's largest commercial property owners, real
estate developers and investors, as well as Fortune 500 and Forbes Global 2000
companies.

We generate revenues from commissions on leasing and capital markets transactions, consulting and technology user fees, property and facility management fees, and mortgage origination and loan servicing fees.

Our growth to date has been focused in North America. As of December 31, 2020,
we had nearly 5,800 employees, including more than 1,800 revenue-generating
producers in over 145 offices in more than 117 cities. In addition, Newmark has
licensed its name to 12 commercial real estate providers that operate out of 18
offices in certain locations where Newmark does not have its own offices.

The discussion of our financial results reflects only the business owned by us
and does not include the results for Knight Frank or for the independently owned
offices that use some variation of the Newmark name in their branding or
marketing.

We are a leading capital markets business in the United States. We have access
to many of the world's largest owners of commercial real estate, and this will
drive growth throughout the life cycle of each real estate asset by allowing us
to provide best-in-class agency leasing and property management during the
ownership period. We also provide investment sales and arrange debt and equity
financing to assist owners in maximizing the return on investment in each of
their real estate assets. Specifically, with respect to multifamily assets, we
are a leading GSE lender by loan origination volume and servicer with a
servicing portfolio of $68.6 billion as of December 31, 2020 (of which 3.4%
relates to special servicing). This servicing portfolio provides a steady stream
of income over the life of the serviced loans.

We continue to invest in the business by adding high profile and talented
producers and other revenue-generating professionals. Historically, newly hired
commercial real estate producers tend to achieve dramatically higher
productivity in their second and third years with our company, although we incur
related expenses immediately. As our newly hired producers increase their
production, we expect our commission revenue and earnings growth to accelerate,
thus reflecting our operating leverage.

Our pre-tax margins are impacted by the mix of revenues generated. For example,
servicing revenues tend to have higher pre-tax margins than Newmark as a whole,
and margins from "Gains from mortgage banking activities/originations, net" tend
to be lower as we retain rights to service loans over time. Capital markets
transactions tend to have higher pre-tax margins than leasing advisory
transactions. Pre-tax earnings margins on our property and facilities
management, along with certain of our other Global Corporate Services ("GCS")
products, are at the lower end of margins for our business as a whole.

Business Environment
In early March 2020, COVID-19 was characterized as a global pandemic by the
World Health Organization. COVID-19 has spread rapidly across the world, which
has resulted in governments and businesses around the world implementing
numerous measures to contain the virus, such as travel bans and restrictions,
quarantines, "shelter-in-place" orders and business shutdowns. The pandemic and
these containment measures have had, and are expected to continue to have, a
substantial negative impact on businesses around the world and on national and
global economies.

As the COVID-19 pandemic unfolded globally, we moved quickly to protect our
employees and implemented a work from home policy, all nonessential business
travel was banned and corporate events were deferred or canceled. In 2020 the US
economy saw a sharp contraction, which triggered a dramatic decline in our
certain of our businesses. There continues to be a significant amount of
uncertainty around COVID-19 and the measures taken by the federal and state
governments in response to this pandemic. Here is a summary of the impact of
COVID-19 on our various businesses:
•U.S. industry leasing and capital markets volumes fell significantly, year to
date, due to the impact of COVID-19, which caused widespread disruptions in
economic activity and elevated uncertainty for commercial real estate valuations
and the outlook for the global economy. While clients continue to defer
decisions on long-term lease renewals and expansions when possible, driving
significantly lower near-term volumes, clients in certain industries such as
industrial, life sciences, e-commerce and technology continue to be active.
Capital market activities are improving in certain asset types, including
multi-family and industrial, and as a result, while capital markets was down for
the year, our capital markets business was up 15.3% in the fourth quarter of
2020. We expect our U.S. capital markets volumes to improve based on elevated
multifamily, life sciences and industrial
                                       65
--------------------------------------------------------------------------------

activity. We anticipate leasing activity will remain challenged until there is
greater clarity around the return to the office, but we believe demand will
accelerate as the pandemic subsides.
•The GSEs financed approximately 70 percent of all multifamily originations in
2008 and 2009, according to the Urban Institute, largely because alternative
sources of financing pulled back significantly. Therefore, we expect the overall
GSE market to perform well in times of overall market stress as demonstrated in
2020. We expect volumes to remain strong in 2021.
•COVID-19 has created new opportunities in our management and consulting
businesses, which continued to performed well during the fourth quarter as our
clients turned to Newmark for advice on their real estate portfolios, including
new environmental safety requirements, managing costs associated with
implementing these new standards as well as assessing facility and employee
readiness as companies plan their return to offices in the wake of the pandemic.
In addition, consulting fee revenues from tenant restructuring and portfolio
optimization are expected to continue in the near-term. We recently hired a head
of global corporate services to expand this critical offerings for occupiers as
they formulate their post pandemic real estate plans.

Impact of COVID-19 on Employees
Newmark has taken steps that it believes will help its employees during this
global pandemic. These policies and practices protect the health, safety and
welfare of the Company's workforce while enabling employees to maintain a high
level of performance. Certain of these items are summarized below.
•The Company activated its Business Continuity Plan in the first quarter of 2020
and, while many of our offices have reopened, we maintain a voluntary
work-from-home policy. We are focused on maximizing productivity regardless of
where our employees choose to work. In all cases, the Company has mandated
appropriate social distancing measures;
•The Company has developed standardized procedures for reopening its offices
safely in accordance with state and local regulatory requirements.
•The Company provides ongoing informational COVID-19 related messages and
notices;
•Where applicable, Newmark has applied and is continuing to apply more frequent
and vigorous hygiene and sanitation measures and providing personal protective
equipment;
•Internal and external meetings are conducted virtually or via phone calls;
•Nonessential business travel has been restricted while personal travel has been
discouraged, particularly in areas most affected by the pandemic;
•Newmark has deferred and is continuing to defer corporate events and
participation in in-person industry conferences;
•If relevant, Newmark has deployed clinical staff internally to support its
employees and required self-quarantine;
•The Company's medical plans have waived applicable member cost sharing for all
diagnostic testing related to COVID-19;
•Newmark continues to pay medical, dental, vision, and life insurance
contributions for furloughed employees;
•The Company also introduced zero co-pay telemedicine for COVID or mental
health-related visits for participants in the U.S. medical plans and their
dependents. Newmark has encouraged the use of telemedicine during the pandemic;
•The Company has reminded employees about its Employee Assistance Program and
the ways it can assist them during this challenging time;
•Newmark provides paid leave in accordance with its policies and applicable
COVID-19-related laws and regulations; and
•Newmark's executive officers volunteered to reduce their annual base salaries
by 50% for Messrs, Lutnick and Gosin and 15% by Messrs, Merkel and Rispoli and
Newmark's independent directors volunteered to forego 15% of their annual cash
retainer, effective from April 27, 2020 through December 31, 2020.

Impact of COVID-19 on Newmark's Clients

  Newmark expects to help its clients manage their real estate portfolios during
this pandemic in the following ways:
•The Company has provided and is continuing to provide consulting and advisory
services for tenants that need assistance with implementing policies with
respect to social distancing, workplace strategy, and portfolio strategies;
•Newmark has assisted and is continuing to assist clients in determining what
their real estate needs will be in the short, medium, and long term and how they
can devise and implement related strategies;
                                       66
--------------------------------------------------------------------------------

•The Company has enabled and is continuing to enable commercial real estate
owners and investors with respect to appraisals and has helped and is continuing
to help in select ways for them to preserve and create value. The Company has
also helped and is continuing to help them navigate new requirements resulting
from the pandemic, including with respect to cleaning, social distancing, and
remote working; and
•Newmark's professionals are in constant communication with many of the largest
institutions in the world to discuss debt and asset strategies in this rapidly
evolving environment.

Impact of COVID-19 on the Company's Results

  The severe economic impact of COVID-19 on leasing and capital markets volumes
is reflected in our results. Our revenues declined $313.1 million, or 14.1%,
during the year ended December 31, 2020 compared to the earlier year. The
decline in revenues was principally as a result of lower industry-wide leasing
and capital markets volumes due to the COVID-19 pandemic. For the year ended
December 31, 2020, our leasing revenues declined $340.9 million, or 39.9%, and
our capital markets revenues declined $87.1 million, or 16.1%, respectively,
compared to the prior annual year. Despite the challenging market conditions, we
saw improvement in capital markets activity in the fourth quarter due to the
significant amount of capital available to invest in real estate and the
continued low interest rate environment.

The significant annual decline in leasing and capital market revenues were partially offset by an increase in revenues generated from GSE mortgage originations. For the year ended December 31, 2020, gains from GSE mortgage originations increased $112.8 million, or 57.0%, compared to the earlier year. We expect the overall GSE market to perform well in times of market stress.

Our management services, serving fees and other revenues decreased by $2.1 million, or 0.3%, for the year ended December 31, 2020 compared to the earlier year.

A significant component of our operating expenses relates to commissions earned
by our producers, which move in tandem with revenues. Additionally, we have
taken actions to reduce our operating and support costs in 2020 and remain
focused on achieving permanent reductions in our expense base through technology
and process improvements. Our total operating expenses were lower by $316.6
million, or 15.4%, for the year ended December 31, 2020 compared to the earlier
year. Included in operating expenses in the year ended December 31, 2020 was
$16.3 million of charges primarily related to our CECL reserve on our financial
guarantee liability provided to Fannie Mae under the DUS Program and $22.6
million of charges related to our cost savings initiatives. These charges were a
direct result of the adverse changes in the macroeconomic conditions caused by
COVID-19.

The Company's 2020 pre-tax earnings were reduced by $84.2 million due to
non-cash mark-to-market losses primarily related to the write-off of the
Company's $50 million equity investment in Knotel, Inc. ("Knotel"), a flexible
workspace provider. Newmark recently acquired all of the first and second lien
debt of Knotel. On January 31, 2021, Newmark agreed to provide approximately $20
million of debtor-in-possession financing to Knotel to acquire the business as
part of Knotel's Chapter 11 sales process, subject to approval of the U.S.
Bankruptcy Court.

Net income/(loss) available to common stockholders declined $37.2 million, or
31.8%, during the year ended December 31, 2020. The decline in net income
available to common stockholders was directly related to a significant decline
in our revenues as a result of the COVID-19 pandemic and other factors described
above.

Certain GAAP expenses have been and may continue to be higher than they
otherwise would have due to the pandemic. The impacted items have included and
may continue to include:
•Non-cash amortization of intangibles with respect to acquisitions;
•Non-cash asset impairment charges with respect to goodwill or other intangible
assets;
•Non-cash mark-to-market adjustments for non-marketable investments;
•Severance charges incurred in connection with headcount reductions as part of
cost savings initiatives;
•Restructuring and other expenses incurred in connection with refocusing parts
of our business to meet changing demands;
•Non-compensation-related charges incurred as part of cost savings initiatives.
Such GAAP items may include charges for exiting leases and/or other long-term
contracts as part of cost saving initiatives;
•Newmark's provisions for non-cash credit reserves under the CECL methodology;
and
•Increased interest expense as a result of additional draw downs on the Credit
Facility.

                                       67
--------------------------------------------------------------------------------

In addition, certain other expenses may be greater than they might otherwise
have been or negatively impact the Company's margins due to the pandemic. These
items are included for purposes of calculating Newmark's GAAP results.

Some of the potentially elevated expenses may be partially offset by certain tax
benefits. It is difficult to predict the amounts of any of these items or when
they might be recorded because they may depend on the duration, severity, and
overall impact of the pandemic.

In response to the impact of the COVID-19 pandemic, we took actions to reduce expenses for support and operations functions.

Separation and Distribution
On December 13, 2017, BGC, BGC Holdings L.P. ("BGC Holdings"), BGC Partners,
L.P. ("BGC U.S. OpCo"), Newmark, Newmark Holdings, Newmark OpCo and, solely for
the provisions listed therein, Cantor and BGC Global Holdings, L.P. entered into
a Separation and Distribution Agreement (as amended on November 8, 2018 and
amended and restated on November 23, 2018, the "Separation and Distribution
Agreement") governing the separation and pro-rata distribution.

See Note 22 - "Long-Term Debt" and Note 27 - "Related Party Transactions" to our
accompanying Consolidated Financial Statements included in Part II, Item 8 of
this Annual Report on Form 10-K for additional information.

BGC's Investment in Newmark Holdings
On March 7, 2018, BGC Partners and its operating subsidiaries purchased 16.6
million newly issued exchangeable limited partnership units (the "Newmark
Units") of Newmark Holdings for $242.0 million (the "Investment by BGC in
Newmark Holdings"). See Note 27 - "Related Party Transactions" to our
accompanying Consolidated Financial Statements included in Part II, Item 8 of
this Annual Report on Form 10-K for additional information.

Debt Credit Agreements
On November 6, 2018, Newmark closed its offering of $550.0 million aggregate
principal amount of 6.125% Senior Notes due 2023 ("6.125% Senior Notes"). The
6.125% Senior Notes are general senior unsecured obligations of Newmark. The
6.125% Senior Notes, which were priced on November 1, 2018 at 98.94% to yield
6.375%, were offered and sold by Newmark in a private offering exempt from the
registration requirements under the Securities Act. Newmark received net
proceeds of $537.6 million, net of debt issue costs and debt discount. The
6.125% Senior Notes bear an interest rate of 6.125% per annum, payable on each
May 15 and November 15, beginning on May 15, 2019 and will mature on November
15, 2023. Newmark used the net proceeds to repay the remaining balance of the
Converted Term Loan of $133.9 million, the balance of the Intercompany Credit
Agreement of $130.5 million, and a portion of the 2019 Promissory Note (as
defined below). The 6.125% Senior Notes were subsequently exchanged for notes
with substantially similar terms that were registered under the Securities Act.
As of December 31, 2020 and 2019, the carrying amount of the 6.125% Senior Notes
was $542.8 million and $540.4 million, respectively.

On November 28, 2018, Newmark entered into a credit agreement by and among Newmark, the several financial institutions from time to time party thereto, as Lenders, and Bank of America N.A., as administrative agent (the "Credit Agreement"). The Credit Agreement provides for a $250.0 million three-year unsecured senior revolving credit facility (the "Credit Facility").

On February 26, 2020, Newmark entered into an amendment to the Credit Agreement
(the "Amended Credit Agreement"), increasing the size of the Credit Facility to
$425.0 million ("the Credit Facility") and extending the maturity date to
February 26, 2023. The interest rate on the Credit Facility was reduced to LIBOR
plus 1.75% per annum, subject to a pricing grid linked to Newmark's credit
ratings from Standard & Poor's and Fitch.

On March 16, 2020, Newmark entered into a second amendment to the Credit
Agreement (the "Second Amended Credit Agreement"), increasing the size of the
Credit Facility to $465.0 million. The interest rate on the Amended Credit
Facility is LIBOR plus 1.75% per annum, subject to a pricing grid linked to
Newmark's credit ratings from Standard & Poor's and Fitch. As of December 31,
2020 and 2019, the carrying amount of the Credit Facility was $137.6 million and
$48.9 million, respectively.

  On June 16, 2020, the Company's Board of Directors and its Audit Committee
authorized a debt repurchase program for the repurchase by the Company in the
amount of up to $50.0 million of the Company's 6.125% Senior Notes and any
future debt securities issued by the Company hereafter (collectively, "Company
debt securities"). Repurchases of Company debt securities, if any, are expected
to reduce future cash interest payments, as well as future amounts due at
maturity or upon redemption.
                                       68
--------------------------------------------------------------------------------

Under the authorization, the Company may make repurchases of Company debt
securities for cash from time to time in the open market or in privately
negotiated transactions upon such terms and at such prices as management may
determine. Additionally, the Company is authorized to make any such repurchases
of Company debt securities through Cantor Fitzgerald & Co. (or its affiliates),
in its capacity as agent or principal, or such other broker-dealers as
management shall determine to utilize from time to time upon customary market
terms or commissions.

As of December 31, 2020, the Company had $50.0 million remaining from its debt repurchase authorization.

On June 19, 2020, Newmark established a $125.0 million sublimit line of credit
to fund potential principal and interest servicing advances on its Fannie Mae
portfolio during the forbearance period related to the CARES Act. The sublimit
is now included within the Company's existing $450 million warehouse facility
due June 16, 2021. The advance line will provide 100% of the principal and
interest advance payment at a rate of 1-month LIBOR plus 2.00% and will be
collateralized by Fannie Mae's commitment to repay advances. Newmark has four
Fannie Mae loans that were delinquent, with $0.1 million of advances outstanding
as of December 31, 2020.

On November 30, 2018, Newmark entered into an unsecured credit agreement (the
"Cantor Credit Agreement") with Cantor. The Cantor Credit Agreement provides for
each party to issue loans to the other party in the lender's discretion.
Pursuant to the Cantor Credit Agreement, the parties and their respective
subsidiaries (with respect to CFLP, other than BGC and its subsidiaries) may
borrow up to an aggregate principal amount of $250.0 million from each other
from time to time at an interest rate which is the higher of Cantor's or
Newmark's short-term borrowing rate then in effect, plus 1.0%. As of December
31, 2020, the Company did not have an outstanding balance under this facility.

Credit Ratings

  Newmark has a stand-alone BBB+ stable credit rating from JCRA, BBB- stable
credit ratings from Fitch Ratings, Inc. and Kroll Bond Rating Agency and a BB+
negative credit rating from Standard & Poor's.

The Spin-Off
On November 30, 2018, BGC completed the Spin-Off to its stockholders of all of
the shares of the Newmark common stock owned by BGC as of immediately prior to
the effective time of the Spin-Off, with shares of Newmark Class A common stock
distributed to the holders of shares of BGC Class A common stock (including
directors and executive officers of BGC Partners) of record as of the close of
business on November 23, 2018 (the "Record Date"), and shares of Newmark Class B
common stock distributed to the holders of shares of BGC's Class B common stock
(consisting of Cantor and CF Group Management, Inc. ("CFGM") of record as of the
close of business on the Record Date).

Based on the number of shares of BGC common stock outstanding as of the close of
business on the Record Date, BGC's stockholders as of the Record Date received
in the Spin-Off 0.463895 of a share of Newmark Class A common stock for each
share of BGC Class A common stock held as of the Record Date, and 0.463895 of a
share of Newmark Class B common stock for each share of BGC Class B common stock
held as of the Record Date. BGC Partners stockholders received cash in lieu of
any fraction of a share of Newmark common stock that they otherwise would have
received in the Spin-Off.

Prior to and in connection with the Spin-Off, 14.8 million Newmark Units held by
BGC were exchanged into 9.4 million shares of Newmark Class A common stock and
5.4 million shares of Newmark Class B common stock, and 7.0 million Newmark OpCo
Units held by BGC were exchanged into 6.9 million shares of Newmark Class A
common stock. These Newmark Class A and Class B shares of common stock were
included in the Spin-Off to BGC's stockholders.

In the aggregate, BGC distributed 131,886,409 shares of our Class A common stock
and 21,285,537 shares of our Class B common stock to BGC's stockholders in the
Spin-Off. These shares of our common stock collectively represented
approximately 94% of the total voting power of our outstanding common stock and
approximately 87% of the total economics of our outstanding common stock in each
case as of the Distribution Date.

On November 30, 2018, BGC Partners also caused its subsidiary, BGC Holdings, to
distribute pro rata (the "BGC Holdings Distribution") all of the 1,458,931
exchangeable limited partnership units of Newmark Holdings held by BGC Holdings
immediately prior to the effective time of the BGC Holdings Distribution to its
limited partners entitled to receive distributions on their BGC Holdings units
(including Cantor and executive officers of BGC) who were holders of record of
such units as of the Record Date. The Newmark Holdings units distributed to BGC
Holdings partners in the BGC Holdings Distribution are exchangeable for shares
of Newmark Class A common stock, and in the case of the 449,917 Newmark Holdings
units received by Cantor also into shares of Newmark Class B common stock, at
the applicable exchange ratio (subject to adjustment). As of December 31, 2020,
the exchange ratio was 0.9379 shares of Newmark common stock per Newmark
Holdings unit.
                                       69
--------------------------------------------------------------------------------

Following the Spin-Off and the BGC Holdings Distribution, BGC Partners ceased to
be our controlling stockholder, and BGC and its subsidiaries no longer held any
shares of our common stock or other equity interests in us or our subsidiaries.
Therefore, BGC no longer consolidates Newmark with its financial results
subsequent to the Spin-Off. Cantor continues to control Newmark and its
subsidiaries following the Spin-Off and the BGC Holdings Distribution.

Nasdaq Monetization Transactions
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 $750.0 million in cash paid upon closing
and an Earn-out of up to 14,883,705 shares of Nasdaq shares to be paid ratably
over 15 years (subject to acceleration and present value discount as discussed
below), provided that Nasdaq, as a whole, produces at least $25.0 million in
consolidated gross revenues each year. Nasdaq generated gross revenues of
approximately $5.6 billion in 2020. The remaining rights under the Nasdaq
Earn-out were transferred to Newmark on September 28, 2017. See Note 7 -
"Marketable Securities" to our accompanying Consolidated Financial Statements
included in Part II, Item 8 of this Annual Report on Form 10-K for additional
information.

On February 2, 2021, Nasdaq announced that it entered into a definitive
agreement to sell its U.S. Fixed income business to Tradeweb, the closing of
which will accelerate Newmark's receipt of the Nasdaq shares, subject to an
agreed upon present value discount (pursuant to the discounting adjustment
provisions set forth in the original purchase agreement). The exact number of
Nasdaq shares to be issued to Newmark in this accelerated issuance will depend
on the closing date of the transaction. Upon the closing of the Nasdaq
transaction, the Company's 2021 and 2022 Nasdaq Forwards are expected to
accelerate and settle. Net of the Nasdaq Forward settlement, Newmark estimates
it will receive approximately 5.0 million shares of Nasdaq stock, worth
approximately $723.5 million, based on the closing price of Nasdaq shares on
February 17, 2021.

Exchangeable Preferred Partnership Units and Forward Contracts
On June 18, 2018, Newmark's principal operating subsidiary, Newmark OpCo, issued
$175.0 million of exchangeable preferred partnership units ("EPUs") in a private
transaction to the Royal Bank of Canada ("RBC"). Newmark received $152.9 million
of cash with respect to this transaction.

On September 26, 2018, Newmark entered into a second agreement to issue $150.0 million of additional EPUs to RBC, similar to the June 18, 2018 transaction (together the "Newmark OpCo Preferred Investment"). Newmark received $113.2 million of cash with respect to this transaction.

The EPUs were issued in four tranches and are separately convertible by either
RBC or Newmark into a fixed number of shares of Newmark Class A common stock,
subject to a revenue hurdle in each of the fourth quarters of 2020 through 2022
for each of the respective four tranches. The ability to convert the EPUs into
Newmark Class A common stock is subject to the SPV's option to settle the
postpaid forward contracts as described below. As the EPUs represent equity
ownership of a consolidated subsidiary of Newmark, they have been included in
"Noncontrolling interests" on our accompanying consolidated balance sheets and
consolidated statements of changes in equity. The EPUs are entitled to a
preferred payable-in-kind dividend, which is recorded as accretion to the
carrying amount of the EPUs through "Retained earnings" on our accompanying
consolidated statements of changes in equity and are reductions to "Net income
(loss) available to common stockholders" for the purpose of calculating earnings
per share.

Contemporaneously with the issuance of the EPUs, the special purpose vehicle
(the "SPV") that is a consolidated subsidiary of Newmark entered into variable
postpaid forward contracts with RBC (together, the "Nasdaq Forwards"). The SPV
is an indirect subsidiary of Newmark whose sole assets are the Nasdaq Earn-outs
for 2019 through 2022. The Nasdaq Forwards provide the SPV the option to settle
using up to 992,247 Nasdaq shares, to be received by the SPV pursuant to the
Nasdaq Earn-out (see Note 7 - "Marketable Securities" to our accompanying
Consolidated Financial Statements included in Part II, Item 8 of this Annual
Report on Form 10-K), or Newmark Class A common stock, in exchange for either
cash or redemption of the EPUs, notice of which must be provided to RBC prior to
November 1 of each year from 2019 through 2022 (subject to acceleration due to
Nasdaq's transaction with Tradeweb).

Upon the closing of Nasdaq's transaction with Tradeweb, Newmark's 2021 and 2022
Nasdaq Forwards may be accelerated and settled at Newmark's or RBC's option.
Actual amounts will depend on the timing of the closing and Nasdaq's stock price
at the time. Nasdaq has stated that the closing is subject to satisfaction of
customary closing conditions, including the receipt of regulatory approvals.
Newmark can provide no assurance as to when or if the closing will occur.

In September 2020, the SPV notified RBC of its decision to settle the second
Nasdaq Forward using the Nasdaq shares the SPV received in November 2020 in
exchange for the second tranche of the EPUs, which resulted in a payable to RBC
that was settled upon receipt of Nasdaq Earn-out shares. The fair value of the
Nasdaq shares that Newmark received was $121.9
                                       70
--------------------------------------------------------------------------------

million. On November 30, 2020, Newmark settled the second Nasdaq Forward with
741,505 Nasdaq shares, with a fair value of $93.5 million and Newmark retained
250,742 Nasdaq shares.

In September 2019, the SPV notified RBC of its decision to settle the first
Nasdaq Forward using the Nasdaq shares the SPV received in November 2019 in
exchange for the first tranche of the EPUs, which resulted in a payable to RBC
that was settled upon receipt of Nasdaq Earn-out shares. The fair value of the
Nasdaq shares that Newmark received was $98.6 million. On December 2, 2019,
Newmark settled the first Nasdaq Forward with 898,685 Nasdaq shares, with a fair
value of $93.5 million and Newmark retained 93,562 Nasdaq shares. These
remaining Nasdaq shares were sold during the three months ended March 31, 2020.

Certain Other Related Party Transactions
Pre-IPO intercompany agreements
In December 2017, prior to our Separation and IPO, all intercompany arrangements
and agreements that were previously approved by the Audit Committee of BGC
Partners with respect to BGC Partners and its subsidiaries and Cantor and its
subsidiaries were also approved by our Board of Directors with respect to the
relationships between us and our subsidiaries and Cantor and its subsidiaries
following our IPO on the terms and conditions approved by the BGC Audit
Committee during such time that our business was owned by BGC Partners. These
arrangements include, but are not limited to, the following: (i) an
authorization to provide Cantor real estate and related services, including real
estate advice, brokerage, property or facilities management, valuation and
advisory and other services; (ii) an authorization to enter into brokerage and
similar agreements with respect to the provision of ordinary course brokerage
services in circumstances in which such entities customarily provide brokerage
services to third-party customers; (iii) an authorization to enter into
agreements with Cantor and/or its affiliates, to provide services, including
finding and reviewing suitable acquisition or partner candidates, structuring
transactions and negotiating and due diligence services in connection with
acquisitions and other business strategies in commercial real estate and other
businesses from time to time; and (iv) an arrangement to jointly manage exposure
to changes in foreign exchange rates. Please see the section entitled "Certain
Relationships and Related Transactions, and Director Independence" in the
Company's Amendment No.1 to the Annual Report on Form 10-K/A for the fiscal year
ended December 31, 2019 filed on April 28, 2020 for a description of these and
other approved arrangements.

Transfer of Employees to Newmark
In connection with the expansion of our mortgage brokerage and lending
activities, Newmark entered into an agreement with Cantor pursuant to which five
former employees of its affiliate, CCRE, transferred to Newmark, effective as of
May 1, 2018. In connection with this transfer of employees, Cantor paid $6.9
million to Newmark in October 2018 and Newmark Holdings issued $6.7 million of
limited partnership units and $0.2 million of cash in the form of a cash
distribution agreement to the employees. In addition, Newmark Holdings issued
$2.2 million of Newmark Holdings partnership units with a capital account and
$0.5 million of limited partnership units in exchange for the cash payment from
Cantor to Newmark of $2.2 million. In consideration for the Cantor payment,
Newmark has agreed to return up to a maximum of $3.3 million to Cantor based on
the employees' production during their first two years of employment with
Newmark. In July 2020, Newmark paid Cantor $3.3 million based on the employees'
production. Newmark has agreed to allow certain of these employees to continue
to provide consulting services to Cantor in exchange for a forgivable loan which
was directly paid by Cantor to these employees.

Services Agreement with CFE Dubai
As the Company does not yet have a presence in Dubai, in May 2020, the Audit
Committee of the Company authorized Newmark & Company Real Estate, Inc.
("Newmark & Co."), a subsidiary of Newmark, to enter into an agreement with
Cantor Fitzgerald Europe (DIFC Branch) ("CFE Dubai") pursuant to which CFE Dubai
will employ and support an individual who is a resident of Dubai in order to
enhance Newmark's capital markets platform, in exchange for a fee. CFE Dubai and
Newmark & Co. negotiated a Services Agreement memorializing the arrangement
between the parties (the "Services Agreement"). The Services Agreement provides
that Newmark & Co. will reimburse CFE Dubai for the individual's fully allocated
costs, plus a mark-up of seven percent (7%). In addition, the Audit Committee of
the Company authorized the Company and its subsidiaries to enter into similar
arrangements in respect of any jurisdiction, in the future, with Cantor and its
subsidiaries, provided that the applicable agreements contain customary terms
for arrangements of this type and that the mark-up charged by the party
employing one or more individuals for the benefit of the other is between 3% and
7.5%, depending on the level of support required for the employed individual(s).


                                       71
--------------------------------------------------------------------------------

Sublease to BGC
In May 2020 RKF Retail Holdings LLC, a subsidiary of the Company, entered into a
one-year sublease to BGC U.S. OpCo of approximately 21,000 rentable square feet
of excess space in New York City. Under the terms of the sublease, BGC U.S. OpCo
will pay a fixed rent amount of $1.1 million in addition to all operating and
tax expenses attributable to the lease. In connection with this agreement, the
Company received $0.8 million from BGC for the year ended December 31, 2020.

GSE loans and related party limits
In February 2019, the Audit Committee of the Company authorized Newmark and its
subsidiaries to originate and service GSE loans to Cantor and its affiliates
(other than BGC) and service loans originated by Cantor and its affiliates
(other than BGC) on prices, rates and terms no less favorable to Newmark and its
subsidiaries than those charged by third parties. The authorization is subject
to certain terms and conditions, including but not limited to: (i) a maximum
amount up to $100.0 million per loan, (ii) a $250.0 million limit on loans that
have not yet been acquired or sold to a GSE at any given time, and (iii) a
separate $250.0 million limit on originated Fannie Mae loans outstanding to
Cantor at any given time.

Transaction with CCRE Lending
On July 22, 2019, Cantor Commercial Real Estate Lending, L.P. ("CCRE Lending"),
a wholly-owned subsidiary of Real Estate LP, made a $146.6 million commercial
real estate loan (the "Loan") to a single-purpose company (the "Borrower") in
which Barry Gosin, Newmark's Chief Executive Officer, owns a 19% interest. The
Loan is secured by the Borrower's interest in property in Pennsylvania that is
subject to a ground lease. While CCRE Lending initially provided the full loan
amount, on August 16, 2019, a third-party bank purchased approximately 80% of
the Loan value from CCRE Lending, with CCRE Lending retaining approximately 20%.
The Loan matures on August 6, 2029, and is payable monthly at a fixed interest
rate of 4.38% per annum. Newmark provided certain commercial loan brokerage
services to the Borrower in the ordinary course of its business, and the
Borrower paid Newmark a fee, as the broker of the Loan, of $0.7 million. The
Newmark Audit Committee approved the commercial loan brokerage services and the
related fee amount received.

Transactions related to ordinary course real estate services
On November 4, 2020, the Audit Committee of the Board of Directors authorized
entities in which executive officers have a non-controlling interest to engage
Newmark to provide ordinary course real estate services to them as long as
Newmark's fees are consistent with the fees that Newmark ordinarily charges for
these services.

Arrangement with View, Inc.
On November 30, 2020, we entered into an arrangement to assist View, Inc.
("View") in the sale of its products and services to real estate clients in
exchange for commissions. View, Inc. is a Silicon Valley-based producer of
high-efficiency dynamic glass that controls light, heat, and glare, providing
unobstructed views and privacy using a low voltage control system. In connection
with the arrangement, View also agreed to engage us as its exclusive provider of
real estate services for a period of at least five years. While View is not
under common control with us, it was, at the time that the agreement was
executed, the target of a merger with CF Finance Acquisition Corp. II, a special
purpose acquisition company sponsored by Cantor.

Key Business Drivers
Key drivers for U.S. commercial real estate services companies include the
overall health of the U.S. economy, institutional ownership of commercial real
estate as an investible asset class, and the ability to attract and retain
talent. In our capital markets business, the availability of credit and
certainty of valuations to investors are key drivers. In our multifamily
business, demographic and economic factors are driving increased demand for new
apartments, with an estimated 4.6 million needed by 2030, according to a 2017
study commissioned by the National Multifamily Housing Council and National
Apartment Association. This should continue to drive investment sales, GSE
multifamily lending and other mortgage brokerage and growth in our servicing
portfolio over time.

Our GSE origination business is impacted by the lending caps imposed by the
Federal Housing Finance Agency (the "FHFA"). On November 17, 2020, the FHFA
announced that the 2021 multifamily loan purchase caps for Fannie Mae and
Freddie Mac will be $70 billion for each GSE. The cap structure allows the GSEs
to offer a combined total of at least $140 billion in lending support to the
multifamily market in 2021. At least 50% of the GSE multifamily loans are
required to be used for affordable and workforce housing. The 2021 caps compare
to $200 billion combined for the five-quarter period from the fourth quarter of
2019 to the fourth quarter of 2020.

Economic Outlook in the United States
COVID-19 adversely affected the economic outlook in 2020, and the scope and
duration of its impact on the U.S. and global economy remain highly uncertain
and cannot be predicted. The U.S. economy contracted by 3.5% in 2020, the worst
performance since 1946. The consensus is for U.S. gross domestic product to
expand by 4.3% in 2021, 3.0% in 2022 and 2.4% in 2023, according to a recent
Wall Street Journal survey of economists. This muted pace of growth expected
during the next few years should help keep interest rates and inflation low by
historical standards.

                                       72
--------------------------------------------------------------------------------

According to a preliminary report from the Bureau of Labor Statistics, the
monthly average of payroll jobs declined by approximately 0.8 million on a net
basis during 2020. The unemployment rate increased to 6.7% in December 2020 from
3.6% in December 2019.

The ten-year Treasury yield declined by approximately 99 basis points to 0.93%
as of December 31, 2020 versus the year-earlier date. Ten-year Treasury yields
have remained well below their 50-year average of approximately 6.19% due to
market expectations that the Federal Open Market Committee ("FOMC") will
maintain a near-zero federal funds rate over the next several years in addition
to muted inflation expectations. On January 27, 2021, the FOMC Committee decided
to maintain the target range for the federal funds rate at 0 to 0.25%. The
Committee expects it will be appropriate to maintain this target range until
labor market conditions have reached levels consistent with the Committee's
assessments of maximum employment and until inflation has risen to 2% and is on
track to moderately exceed 2% for some time.


Market Statistics
COVID-19 adversely affected U.S. commercial real estate transaction volumes in
2020, and its impact on U.S. and international commercial real estate and the
overall commercial mortgage market are highly uncertain and cannot be predicted.
According to Real Capital Analytics ("RCA"), prices for commercial real estate
were up by 7.3% for the year ended December 31, 2020, despite lower volumes.
These price increases were driven by concentrated activity in certain market
segments such as multifamily and industrial, and resulted in price increases in
those sectors. In 2020, overall U.S. commercial real estate notional sales
volumes decreased by 34%, according to RCA. In comparison, our investment sales
volumes decreased 5% in 2020.

According to a November 2020 Mortgage Bankers Association ("MBA") forecast, originations of commercial/multifamily loans of all types are projected to decrease approximately 34% in 2020 and increase 41% in 2021. Our total debt volumes were down 23% to $24 billion in 2020.

Newmark's loan origination volumes are driven more by the GSE multifamily
financing volumes than the activity level of the overall commercial mortgage
market. Overall industry GSE multifamily origination volumes increased by 7% in
2020. In comparison, Newmark's combined notional volumes across GSE and FHA
multifamily loan originations increased by 14% year-over-year. The GSE
multifamily agency volume statistics for the industry are based on when loans
are sold and/or securitized, and typically lag those reported by Newmark and its
competitors by 30 to 45 days.

Regulatory Environment
See "Business-Regulation" in Part I, Item 1 of this Annual Report on Form 10-K
for information related to our regulatory environment.

Liquidity

See "-Financial Position, Liquidity and Capital Resources" herein for information related to our liquidity and capital resources.

Financial Overview

Revenues

We derive revenues from the following general four sources:
•Leasing and Other Commissions. We offer a diverse range of commercial real
estate brokerage and advisory services, including tenant and agency
representation, which includes comprehensive lease negotiations, strategic
planning, site selection, lease auditing, and other financial and market
analysis.
•Capital Markets. Our real estate capital markets business specializes in the
arrangement of acquisitions and dispositions of commercial properties, as well
as providing other financial services, including the arrangement of debt and
equity financing, and loan sale advisory.
•Gains from Mortgage Banking Activities/Originations, Net. Gains from mortgage
banking activities/originations are derived from the origination of loans with
borrowers and the sale of those loans to investors.
•Management Services, Servicing Fees and Other. We provide commercial services
to tenants and landlords. In this business, we provide property and facilities
management services along with project management, valuation and advisory
services and other consulting services, as well as technology, to customers who
may also utilize our commercial real estate brokerage services. Servicing fees
are derived from the servicing of loans originated by us as well as loans
originated by third parties.

                                       73
--------------------------------------------------------------------------------

Fees are generally earned when a lease is signed. In many cases, landlords are
responsible for paying the fees. In capital markets, fees are earned and
recognized when the sale of a property closes, and title passes from seller to
buyer for investment sales and when debt or equity is funded to a vehicle for
debt and equity transactions. Gains from mortgage banking
activities/originations, net are recognized when a derivative asset is recorded
upon the commitment to originate a loan with a borrower and sell the loan to an
investor. The derivative is recorded at fair value and includes loan origination
fees, sales premiums and the estimated fair value of the expected net servicing
cash flows. Gains from mortgage banking activities/originations, net are
recognized net of related fees and commissions to affiliates or third-party
brokers. For loans we broker, revenues are recognized when the loan is closed.
Servicing fees are recognized on an accrual basis over the lives of the related
mortgage loans. We typically receive monthly management fees based upon a
percentage of monthly rental income generated from the property under
management, or in some cases, the greater of such percentage or a minimum agreed
upon fee. We are often reimbursed for our administrative and payroll costs, as
well as certain out-of-pocket expenses, directly attributable to properties
under management. We follow accounting principles generally accepted in the
U.S., or "U.S. GAAP", which provides guidance when accounting for reimbursements
from clients and when accounting for certain contingent events for Leasing and
Capital Markets transactions. See Note 3 - "Summary of Significant Accounting
Policies" to our Consolidated Financial Statements included in Part II, Item 8
of this Annual Report on Form 10-K for a more detailed discussion.

Expenses

Compensation and Employee Benefits
The majority of our operating costs consist of cash and non-cash compensation
expenses, which include base salaries, producer commissions based on production,
forgivable loans for term contracts, discretionary and other bonuses and all
related employee benefits and taxes. Our employees consist of commissioned
producers, executives and other administrative support. Our producers are
largely compensated based on the revenue they generate for the firm, keeping
these costs variable in nature.

As part of our compensation plans, certain employees have been granted limited
partnership units in Newmark Holdings and BGC Holdings, which generally receive
quarterly allocations of net income and are generally contingent upon services
being provided by the unit holders. Certain Newmark employees also hold
non-distribution earnings units (e.g. NPSUs and NREUs, collectively "N Units")
that do not participate in quarterly partnership distributions and are not
allocated any items of profit or loss. These N Units vest into distribution
earnings units over a 4-year period. As prescribed in U.S. GAAP guidance, the
quarterly allocations of net income on such limited partnership units are
reflected as a component of compensation expense under "Equity-based
compensation and allocations of net income to limited partnership units and
FPUs" in our accompanying consolidated statements of operations. During 2019,
Newmark simplified its compensation structure when hiring new personnel by
issuing restricted stock units in lieu of limited partnership units. Newmark
continues to monitor its compensation policy and make changes where necessary to
attract industry leading producers to Newmark.

Newmark granted conversion rights on outstanding limited partnership units in
Newmark Holdings and BGC Holdings to Newmark employees to convert the limited
partnership units to a capital balance within Newmark Holdings or BGC Holdings.
Generally, such units are not considered share-equivalent limited partnership
units and are not in the fully diluted share count.

Certain of these limited partnership units entitle the holders to receive
post-termination payments. These limited partnership units are accounted for as
post-termination liability awards under U.S. GAAP guidance, which requires that
we record an expense for such awards based on the change in value at each
reporting period and include the expense in our accompanying consolidated
statements of operations as part of "Equity-based compensation and allocations
of net income to limited partnership units and FPUs". The liability for limited
partnership units with a post-termination payout amount is included in "Other
long-term liabilities" on our accompanying consolidated balance sheets.

Certain limited partnership units are granted exchangeability into Class A
common stock or may be redeemed in connection with the grant of shares of Class
A common stock. At the time exchangeability is granted, or the shares are
issued, Newmark recognizes an expense based on the fair value of the award on
that date, which is included in "Equity-based compensation and allocations of
net income to limited partnership units and FPUs" in our accompanying
consolidated statements of operations.

Our employees have been awarded preferred partnership units ("Preferred Units")
in Newmark Holdings and BGC Holdings. Each quarter, the net profits of Newmark
Holdings and BGC Holdings are allocated to such units at a rate of either
0.6875% (which is 2.75% per calendar year) or such other amount as set forth in
the award documentation (the "Preferred Distribution"), which is deducted before
the calculation and distribution of the quarterly partnership distribution for
the remaining partnership units in Newmark Holdings and BGC Holdings,
respectively. The Preferred Units are not entitled to participate in partnership
distributions other than with respect to the Preferred Distribution. Preferred
Units may not be made exchangeable into our Class A common stock and are only
entitled to the Preferred Distribution, and accordingly they are not
                                       74
--------------------------------------------------------------------------------

included in our fully diluted share count. The quarterly allocations of net
income on Preferred Units are also reflected in compensation expense under
"Equity-based compensation and allocations of net income to limited partnership
units and FPUs" in our accompanying consolidated statements of operations. After
deduction of the Preferred Distribution, the remaining partnership units
generally receive quarterly allocation of net income based on their
weighted-average pro rata share of economic ownership of the operating
subsidiaries. In addition, Preferred Units are granted in connection with the
grant of certain limited partnership units, such as PSUs, that may be granted
exchangeability to cover the withholding taxes owed by the unit holder upon such
exchange. This is an acceptable alternative to the common practice among public
companies of issuing the gross amount of shares to employees, subject to
cashless withholding of shares to pay applicable withholding taxes.

We have entered into various agreements with certain of our employees and
partners whereby these individuals receive loans, which may be either wholly or
in part repaid from the distribution earnings that the individual receives on
their limited partnership interests in BGC Holdings and Newmark Holdings. The
forgivable portion of these loans is recognized as compensation expense over the
life of the loan.

From time to time, we may also enter into agreements with employees and partners
to grant bonus and salary advances or other types of loans. These advances and
loans are repayable in the timeframes outlined in the underlying agreements. In
addition, we also enter into deferred compensation agreements with employees
providing services to us. The costs associated with such plans are generally
amortized over the period in which they vest. (See Note 30 - "Compensation" and
Note 31 - "Commitment and Contingencies", to our accompanying Consolidated
Financial Statements included in Part II, Item 8 of this Annual Report on Form
10-K).

Other Operating Expenses
We have various other operating expenses. We incur leasing, equipment and
maintenance expenses. We also incur selling and promotion expenses, which
include entertainment, marketing and travel-related expenses. We incur
communication expenses, professional and consulting fees for legal, audit and
other special projects, and interest expense related to short-term operational
funding needs, and notes payable and collateralized borrowings.

We pay fees to Cantor for performing certain administrative and other support,
including charges for occupancy of office space, utilization of fixed assets and
accounting, operations, human resources, legal services and technology
infrastructure support. Management believes that these charges are a reasonable
reflection of the utilization of services rendered. However, the expenses for
these services are not necessarily indicative of the expenses that would have
been incurred if we had not obtained these services from Cantor. In addition,
these charges may not reflect the costs of services we may receive from Cantor
in the future.

Other Income, Net
Other income, net is comprised of the gains associated with the Earn-out shares
related to the Nasdaq Transaction and the movements related to the impact of any
unrealized non-cash mark-to-market gains or losses related to the Nasdaq
Forwards. Additionally, other income includes gains (losses) on equity method
investments which represent our pro rata share of the net gains (losses) on
investments over which we have significant influence but which we do not
control, and the mark-to-market gains or losses on the non-marketable
investments.

Provision for Income Taxes
We incur income tax expenses based on the location, legal structure, and
jurisdictional taxing authorities of each of our subsidiaries. Certain of the
Company's entities are taxed as U.S. partnerships and are subject to the
Unincorporated Business Tax (which we refer to as "UBT") in New York City. U.S.
federal and state income tax liability or benefit related to the partnership
income or loss, with the exception of UBT, rests with the partners (see Note 2 -
"Limited Partnership Interests in Newmark Holdings and BGC Holdings", to our
accompanying Consolidated Financial Statements included in Part II, Item 8 of
this Annual Report on Form 10-K) rather than the partnership entity. Our
accompanying consolidated financial statements include U.S. federal, state and
local income taxes on Newmark's allocable share of the U.S. results of
operations. Outside of the U.S., we operate principally through subsidiary
corporations subject to local income taxes.

Impact of Adopting Revenue Recognition Guidance
On January 1, 2018, we adopted Accounting Standards Codification 606, Revenue
from Contracts with Customers ("ASC 606"), which provides accounting guidance on
the recognition of revenues from contracts with customers and impacts the
presentation of certain revenues and expenses in our accompanying consolidated
statements of operations. Newmark elected to adopt ASC 606 using a modified
retrospective approach with regard to contracts that were not completed as of
December 31, 2017, and prospectively from January 1, 2018 onward. Due to the
adoption of ASC 606, for all periods from the first quarter of 2018 onward,
Newmark did not and will not record revenues or earnings related to "Leasing and
other commissions" with respect to contingent revenue expected to be received in
future periods as of December 31, 2017, in relation to contracts signed
                                       75
--------------------------------------------------------------------------------

prior to January 1, 2018, for which services have already been completed.
Instead, Newmark recorded this contingent revenue and related commission
payments on the balance sheet on January 1, 2018, with a corresponding pre-tax
improvement of $22.7 million and Newmark recognized an increase of $16.5 million
and $2.3 million to beginning retained earnings and noncontrolling interests,
respectively, as a cumulative effect of adoption of an accounting change.

See Note 13 - "Revenues from Contracts with Customers" to our accompanying Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K, for further information.

Impact of Adopting Lease Guidance
On January 1, 2019, Newmark adopted Accounting Standards Codification 842,
Leases ("ASC 842"), which provides guidance on the accounting and disclosure for
accounting for leases. Newmark has elected the optional transition method, and
pursuant to this transition method, financial information will not be updated
and the disclosures required under the new standard will not be provided for
dates and periods prior to January 1, 2019. Newmark has elected the package of
"practical expedients," which permits Newmark not to reassess under the new
standard its prior conclusions about lease identification, lease classification
and initial direct costs. Newmark has elected the short-term lease recognition
exemption for all leases that qualify, and has elected the practical expedient
to not separate lease and non-lease components for all leases other than real
estate leases.

The adoption of ASC 842 on January 1, 2019 resulted in the recognition of Right-of-use ("ROU") assets of approximately $178.8 million and ROU liabilities of approximately $226.7 million, with no effect on beginning retained earnings.

The adoption of the new guidance did not have a significant impact on our accompanying consolidated statements of operations, consolidated statements of changes in equity, and consolidated statements of cash flows.

See Note 3 - "Summary of Significant Accounting Policies" and Note 18 - "Leases"
to our accompanying Consolidated Financial Statements included in Part II, Item
8 of this Annual Report on Form 10-K, for further information.

Impact of Adopting Credit Loss Guidance
On January 1, 2020, Newmark adopted Accounting Standards Codification 326,
Financial Instrument-Credit Losses: Measurement of Credit Losses on Financial
Instruments ("ASC 326"), which provides guidance on the accounting and
disclosure for accounting for expected credit losses on financial instruments.

The adoption of ASC 326 on January 1, 2020, on a pre-tax basis, resulted in a
decrease in assets of $8.0 million, an increase in liabilities of $17.9 million
and a decrease in beginning retained earnings of $25.9 million.

See Note 3 - "Summary of Significant Accounting Policies" and Note 23 - "Financial Guarantee Liability" to our accompanying Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K, for further information.

                                       76
--------------------------------------------------------------------------------

Results of Operations

The following table sets forth our consolidated statements of operations data expressed as a percentage of total revenues for the periods indicated (in thousands):

                                                                                       Year Ended December 31,
                                                                 2020                           2019                                              2018
                                                                                                        Percentage of                                     Percentage of                                     Percentage of
                                                                               Actual Results           Total Revenues           Actual Results           Total Revenues           Actual Results           Total Revenues

Revenues:

Leasing and other commissions                                                $       513,842                    27.0   %       $       854,780                    38.5   %       $       817,435                    39.9   %
Capital markets                                                                      454,106                    23.8                   541,255                    24.4                   468,904                    22.9
Gains from mortgage banking
activities/originations, net                                                         310,914                    16.3                   198,085                     8.9                   182,264                     8.9
Management services, servicing fees and other                                        626,136                    32.9                   624,012                    28.1                   578,976                    28.3
Total revenues                                                                     1,904,998                   100.0                 2,218,132                   100.0                 2,047,579                   100.0
Expenses:
Compensation and employee benefits                                                 1,147,360                    60.2                 1,275,988                    57.5                 1,161,985                    56.7
Equity-based compensation and allocations of
net
  income to limited partnership units and
FPUs (1)                                                                             130,759                     6.9                   258,836                    11.7                   224,644                    11.0
Total compensation and employee benefits                                           1,278,119                    67.1                 1,534,824                    69.2                 1,386,629                    67.7
Operating, administrative and other                                                  294,405                    15.5                   361,857                    16.3                   331,758                    16.2
Fees to related parties                                                               22,573                     1.2                    25,025                     1.1                    26,162                     1.3
Depreciation and amortization                                                        141,193                     7.4                   131,144                     5.9                    97,733                     4.8
Total operating expenses                                                           1,736,290                    91.1                 2,052,850                    92.5                 1,842,282                    90.0
Other income/(loss), net                                                              15,290                     0.8                    80,954                     3.6                   127,293                     6.2
Income from operations                                                               183,998                     9.7                   246,236                    11.1                   332,590                    16.2
Interest (expense) income, net                                                       (37,728)                   (2.0)                  (32,088)                   (1.4)                  (50,205)                   (2.5)
Income before income taxes and noncontrolling
interests                                                                            146,270                     7.7                   214,148                     9.7                   282,385                    13.8
Provision for income taxes                                                            36,993                     1.9                    52,436                     2.4                    90,487                     4.4
Consolidated net income                                                              109,277                     5.7                   161,712                     7.3                   191,898                     9.4
Less: Net income attributable to
noncontrolling interests                                                              29,217                     1.5                    44,407                     2.0                    85,166                     4.2
Net income available to common stockholders                                  $        80,060                     4.2   %       $       117,305                     5.3   %       $       106,732                     5.2   %

(1)The components of Equity-based compensation and allocations of net income to limited partnership units and FPUs are as follows (in thousands):

                                                                             Year Ended December 31,
                                                        2020                           2019                                             2018
                                                                                               Percentage of                                    Percentage of                                    Percentage of
                                                                      Actual Results          Total Revenues           Actual Results          Total Revenues           Actual Results          Total Revenues
Issuance of common stock and
exchangeability expenses                                            $        69,041                    3.6   %       $       181,714                    8.2   %       $       179,333                    8.8   %
Allocations of net income to limited
partnership units and FPUs                                                   30,461                    1.6                    50,410                    2.3                    51,462                    2.5
Limited partnership units
amortization                                                                 18,692                    1.0                    21,508                    1.0                    (7,938)                  (0.4)
RSU amortization                                                             12,565                    0.7                     5,204                    0.2                     1,787                    0.1
Equity-based compensation and
allocations of net
income to limited partnership units
and FPUs                                                            $       130,759                    6.9   %       $       258,836                   11.7   %       $       224,644                   11.0   %


                                       77

--------------------------------------------------------------------------------

Year ended December 31, 2020 compared to the year ended December 31, 2019

Revenues

Leasing and Other Commissions
Leasing and other commission revenues decreased by $340.9 million, or 39.9% to
$513.8 million for the year ended December 31, 2020 as compared to the year
ended December 31, 2019. Leasing and other commissions volumes fell
significantly beginning in March of 2020 due to lower industry-wide leasing
resulting from the impact of the COVID-19 pandemic, and in particular, our
presence in large, urban markets, such as New York city and the San Francisco
Bay Area.

Capital Markets
Capital markets revenue decreased by $87.1 million or 16.1% to $454.1 million
for the year ended December 31, 2020 as compared to the year ended December 31,
2019. Capital market volumes fell significantly beginning in March of 2020 due
to lower industry-wide leasing resulting from the impact of the COVID-19
pandemic. However, a low interest rate environment coupled with significant
capital available to invest in real estate has led to sequential improvement in
capital markets activity since the second quarter of 2020, with investments
concentrated in certain asset types, such as multi-family, life sciences and
industrial. Our capital markets business was up 15.3% in the fourth quarter of
2020 as compared to the fourth quarter of 2019.

Gains from Mortgage Banking Activities/Originations, Net Gains from mortgage banking activities, net increased by $112.8 million or 57.0%, to $310.9 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019. The increase was primarily due to strong GSE originations and a more balanced product mix.

A portion of our gains from mortgage banking activities, net, relate to non-cash
gains attributable to OMSRs. We recognize OMSR gains equal to the fair value of
servicing rights retained on mortgage loans originated and sold. For the years
ended December 31, 2020 and 2019, we recognized $194.8 million and
$109.2 million of non-cash gains, respectively, related to OMSRs.

Management Services, Servicing Fees and Other
Management services, servicing fees and other revenue increased $2.1 million, or
0.3%, to $626.1 million for the year ended December 31, 2020 as compared to the
year ended December 31, 2019. The increase was primarily due to an increase in
non-fee pass-through revenue and valuation and appraisal, offset by lower
interest income on escrow balances, lower interest on loans held for sale, and
lower yield maintenance fees.

Expenses

Compensation and Employee Benefits
Compensation and employee benefits expense decreased by $128.6 million, or
10.1%, to $1,147.4 million for the year ended December 31, 2020 as compared to
the year ended December 31, 2019. The decrease in the year ended December 31,
2020 was directly related to lower commission based revenues and our cost
savings initiatives, partially offset by non-fee expenses and amortization of
hiring costs.

Equity-based compensation and allocations of net income to limited partnership
units and FPUs
Equity-based compensation and allocations of net income to limited partnership
units and FPUs decreased by $128.1 million, or 49.5%, to $130.8 million for the
year ended December 31, 2020 as compared to the year ended December 31, 2019 as
a result of lower stock compensation charges of $112.7 million and lower income
allocation charges of $20.0 million due to lower earnings.

Operating, Administrative and Other
Operating, administrative and other expenses decreased $67.5 million, or 18.6%,
to $294.4 million for the year ended December 31, 2020 as compared to the year
ended December 31, 2019 due to our cost savings initiatives.

Fees to Related Parties
Fees to related parties decreased by $2.5 million, or 9.8%, to $22.6 million for
the year ended December 31, 2020 as compared to the year ended December 31,
2019.


                                       78
--------------------------------------------------------------------------------

Depreciation and Amortization
Depreciation and amortization for the year ended December 31, 2020 increased by
$10.0 million, or 7.7%, to $141.2 million as compared to the year ended December
31, 2019. This increase was due to a $9.7 million increase in mortgage servicing
rights amortization.

Because Newmark recognizes OMSR gains equal to the fair value of servicing
rights retained on mortgage loans originated and sold, it also amortizes MSRs in
proportion to the net servicing revenue expected to be earned. Subsequent to the
initial recording, MSRs are amortized and carried at the lower of amortized cost
or fair value. For the for the years ended December 31, 2020 and 2019, our
revenue included $194.8 million and $109.2 million respectively, our expenses
included $111.3 million and $101.5 million of MSR amortization, respectively.
The MSR amortization increased due to higher scheduled amortization as a result
of growth in the book value of the MSRs.

Other Income (loss), Net
Other income (loss), net of $15.3 million in the year ended December 31, 2020
was primarily related to $121.9 million of income related to the 2020 annual
Nasdaq Earn-out, partially offset by $84.2 million of mark-to-market losses on
non-marketable investments, a mark-to-market loss related to the Nasdaq Forwards
of $13.7 million and $11.6 million of equity losses from Real Estate LP.

Other income, net of $81.0 million in the year ended December 31, 2019 was
primarily related to the recognition of income from the receipt of Nasdaq shares
of $113.9 million, including appreciation of Nasdaq shares held by Newmark, and
unrealized gains of $12.2 million relating to non-marketable investments carried
under the measurement alternative, partially offset by mark-to-market losses
related to the Nasdaq Forwards of $51.1 million.

Interest (Expense) Income, Net
Interest expense, net increased by $5.6 million, or 17.6%, to $37.7 million
during the year ended December 31, 2020 as compared to the year ended December
31, 2019 due to borrowings on our Credit Facility.

Provision for Income Taxes
Provision for income taxes decreased by $15.4 million, or 29.5%, to $37.0
million for the year ended December 31, 2020 as compared to the year ended
December 31, 2019. This decrease was primarily driven by lower pretax earnings.
In general, our consolidated effective tax rate can vary from period to period
depending on, among other factors, the geographic and business mix of our
earnings.

Net income attributable to noncontrolling interests Net income attributable to noncontrolling interests decreased by $15.2 million, or 34.2%, to $29.2 million for the year ended December 31, 2020.

Year ended December 31, 2019 compared to the year ended December 31, 2018

Revenues

Leasing and Other Commissions
Leasing and other commission revenues increased by $37.3 million, or 4.6%, to
$854.8 million for the year ended December 31, 2019 as compared to the year
ended December 31, 2018. The increase was largely due to organic growth.

Capital Markets
Capital markets revenue increased by $72.4 million, or 15.4%, to $541.3 million
for the year ended December 31, 2019 as compared to the year ended December 31,
2018. The increase was driven by a 47.6% increase in mortgage brokerage volume
and a 19.9% increase in investment sales volume, both of which significantly
outpaced overall industry growth volumes in the U.S.

Gains from Mortgage Banking Activities/Originations, Net
Gains from mortgage banking activities, net increased by $15.8 million, or 8.7%,
to $198.1 million for the year ended December 31, 2019 as compared to the year
ended December 31, 2018. The increase was primarily driven by an increase in GSE
loan origination volume of $1.4 billion, or 16.1%, to $9.9 billion for the year
ended December 31, 2019. As with other multifamily agency lenders, Newmark's mix
of originations, and therefore revenues, can vary depending on the size of
loans, as well by the categories of loans with respect to the FHA, Freddie Mac,
and different Fannie Mae structures.

                                       79
--------------------------------------------------------------------------------

A portion of our gains from mortgage banking activities, net, relate to non-cash
gains attributable to OMSRs. We recognize OMSR gains equal to the fair value of
servicing rights retained on mortgage loans originated and sold. For the years
ended December 31, 2019 and 2018, we recognized $109.2 million and
$103.2 million of non-cash gains, respectively, related to OMSRs. As with
originations, OMSR gains are also impacted by the product mix.

Management Services, Servicing Fees and Other
Management services, servicing fees and other revenue increased $45.0 million,
or 7.8%, to $624.0 million for the year ended December 31, 2019 as compared to
the year ended December 31, 2018. Valuation and advisory increased $21.4
million, or 31.1%. Servicing fees increased $11.1 million (which includes a $4.1
million increase in interest income on escrow balances and a $3.5 million
increase in yield maintenance fees), and interest income on loans held for sale
increased $2.0 million, which was largely offset by additional interest expense
on the warehouse facilities collateralized by U.S. Government Sponsored
Enterprises.

Expenses

Compensation and Employee Benefits
Compensation and employee benefits expense increased by $114.0 million, or 9.8%,
to $1.3 billion for the year ended December 31, 2019 as compared to the year
ended December 31, 2018. The main driver of this increase was Newmark's
continued hiring of leading industry professionals.

Equity-based compensation and allocations of net income to limited partnership
units and FPUs
Equity-based compensation and allocations of net income to limited partnership
units and FPUs increased by $34.2 million, or 15.2%, to $258.8 million for the
year ended December 31, 2019 as compared to the year ended December 31, 2018.
This increase was primarily driven by an increase of $32.9 million in equity
amortization.

Operating, Administrative and Other
Operating, administrative and other expenses increased $30.1 million, or 9.1%,
to $361.9 million for the year ended December 31, 2019 as compared to the year
ended December 31, 2018. This increase was primarily driven by increases in
selling and promotional and other expenses associated with acquisitions and new
hires, an increase in interest expense on the warehouse facilities
collateralized by GSEs of $3.8 million, which is partially offset by the
increase in interest income on Loans held for sale, at fair value.

Fees to Related Parties
Fees to related parties decreased by $1.1 million, or 4.3%, to $25.0 million for
the year ended December 31, 2019 as compared to the year ended December 31,
2018.

Depreciation and Amortization
Depreciation and amortization for the year ended December 31, 2019 increased by
$33.4 million, or 34.2%, to $131.1 million as compared to the year ended
December 31, 2018. This increase was due to a $23.1 million increase in mortgage
servicing rights amortization and a $9.0 million increase in fixed asset
depreciation, which was due to a $5.0 million asset impairment related to
Newmark's restructuring plan.

Because Newmark recognizes OMSR gains equal to the fair value of servicing
rights retained on mortgage loans originated and sold, it also amortizes MSRs in
proportion to the net servicing revenue expected to be earned. Subsequent to the
initial recording, MSRs are amortized and carried at the lower of amortized cost
or fair value. For the years ended December 31, 2019 and 2018, our expenses
included $101.5 million and $78.4 million of MSR amortization, respectively.
$17.1 million of the increase in MSR amortization was due to an impairment of
the MSR to fair value resulting from a year over year decline in interest rates.

Other Income, Net
Other income, net of $81.0 million in the year ended December 31, 2019 was
primarily related to the recognition of income from the receipt of Nasdaq shares
of $113.9 million, including appreciation of Nasdaq shares held by Newmark, and
unrealized gains of $12.2 million relating to non-marketable investments carried
under the measurement alternative, partially offset by mark-to-market losses
related to the Nasdaq Forwards of $51.1 million.

Interest (Expense) Income, Net
Interest expense, net decreased by $18.1 million to $32.1 million during the
year ended December 31, 2019 as compared to the year ended December 31, 2018.
Interest expense decreased due to the reduction in our long-term debt.

                                       80
--------------------------------------------------------------------------------

Provision for Income Taxes
Provision for income taxes decreased by $38.1 million, or 42.1%, to $52.4
million for the year ended December 31, 2019 as compared to the year ended
December 31, 2018. This decrease was primarily driven by the mix of allocable
revenues among legal entities as a corporation versus flow through and certain
return to provision adjustments, in addition to the revaluation of the deferred
tax assets in the prior year, due to the Spin-Off. In general, our consolidated
effective tax rate can vary from period to period depending on, among other
factors, the geographic and business mix of our earnings.

Net income attributable to noncontrolling interests
Net income attributable to noncontrolling interests decreased by $40.8 million,
or 47.9%, to $44.4 million for the year ended December 31, 2019. The decrease
was primarily attributable to the change in Newmark's corporate structure
related to the Separation.
QUARTERLY RESULTS OF OPERATIONS

The following table sets forth our quarterly results of operations for the
indicated periods (in thousands). Results of any period are not necessarily
indicative of results for a full year and may, in certain periods, be affected
by seasonal fluctuations in our business. Certain reclassifications have been
made to prior period amounts to conform to the current period's presentation.
                                        December 31,        September 30,                                                        December 31,        September 30,
                                            2020                2020              June 30, 2020           March 31, 2020             2019               2019 (1)            June 30, 2019           March 31, 2019

Revenues:

Commissions                             $  328,645          $  197,903

$ 173,038 $ 268,362 $ 416,728 $

357,908 $ 346,131 $ 275,268 Gains from mortgage banking activities/originations, net

               100,228              91,192                  69,071                   50,422              49,316               72,332                  45,091                   31,346
Management services, servicing fees
and other                                  172,553             146,829                 141,609                  165,146             166,320              156,394                 160,256                  141,042
Total revenues                             601,426             435,924                 383,718                  483,930             632,364              586,634                 551,478                  447,656
Expenses:
Compensation and employee
benefits                                   362,676             253,908                 230,518                  300,257             354,862              341,036                 316,737                  263,353
Equity-based compensation and
allocations of net income to
limited partnership units and FPUs          56,215              50,769                  10,860                   12,914             148,965               56,647                  39,353                   13,871
Total compensation and
employee benefits                          418,891             304,677                 241,378                  313,171             503,827              397,683                 356,090                  277,224
Operating, administrative and other         79,322              61,790                  61,012                   92,281              85,918               86,297                 101,749                   87,893
Fees to related parties                      5,447               6,109                   5,205                    5,812               3,990                7,088                   7,222                    6,725
Depreciation and amortization               36,580              29,627                  28,946                   46,039              32,634               36,781                  33,425                   28,304
Total operating expenses                   540,240             402,203                 336,541                  457,303             626,369              527,849                 498,486                  400,146
Other income (loss), net                   (58,367)            108,608                 (36,389)                   1,438             (14,313)             108,711                  (3,726)                  (9,718)
Income (loss) from operations                2,819             142,329                  10,788                   28,065              (8,318)             167,496                  49,266                   37,792
Interest expense, net                       (9,111)             (9,532)                (10,056)                  (9,030)             (8,141)              (8,167)                 (8,081)                  (7,699)
Income (loss) before income taxes and
noncontrolling interests                    (6,292)            132,797                     732                   19,035             (16,459)             159,329                  41,185                   30,093
Provision (benefit) for income taxes        (1,165)             33,272                      88                    4,797                (132)              36,760                   9,121                    6,687
Consolidated net income (loss)              (5,127)             99,525                     644                   14,238             (16,327)             122,569                  32,064                   23,406
Less: Net income (loss) attributable to
noncontrolling interests                    (1,346)             24,176                     330                    6,056              (5,362)              33,871                   9,396                    6,502
Net income (loss) available to
common stockholders                     $   (3,781)         $   75,349          $          314          $         8,182          $  (10,965)         $    88,698          $       22,668          $        16,904

(1)Amounts include the gains related to the Nasdaq Earn-out associated with the Nasdaq monetization transactions recorded in Other income (loss), net.

                                       81
--------------------------------------------------------------------------------

Financial Position, Liquidity and Capital Resources

Actions taken in response to COVID-19

  In 2020, we took various measures to strengthen our balance sheet and maintain
liquidity to withstand the potential impact of the COVID-19 pandemic. We
increased our Credit Facility from $250.0 million to $465.0 million to enhance
financial flexibility. We reduced dividends to common stockholders to $0.01 as
approved by our Board of Directors beginning with the first quarter of 2020, and
distributions to partners were reduced comparably. We took actions to reduce
expenses for 2020, and on an ongoing basis, related to support and operations
functions. Collectively, these actions reinforce our ability to maintain
financial flexibility during the COVID-19 pandemic and emerge from the crises
with market share gains.

Overview

The primary source of liquidity for our business is the cash flow provided by our operations and our off-balance sheet Nasdaq asset.

Our future capital requirements will depend on many factors, including our
growth, the expansion of our sales and marketing activities, our expansion into
other markets and our results of operations. To the extent that existing cash,
cash from operations and credit facilities, and Nasdaq shares are insufficient
to fund our future activities, we may need to raise additional funds through
public equity or debt financing. As of December 31, 2020, our long-term debt
consists of our 6.125% Senior Notes with a carrying amount of $542.8 million and
$137.6 million outstanding under the Credit Facility.

Financial Position
Total assets at December 31, 2020 were $4.0 billion as compared to $3.2 billion
at December 31, 2019. The increase of $780.9 million can be primarily attributed
to an increase in loans held for sale, at fair value of $871.5 million.

Total liabilities at December 31, 2020 and 2019 were $3.0 billion and $2.2
billion, respectively. The increase of $801.8 million can be primarily
attributed to an increase in outstanding borrowings under warehouse facilities
collateralized by U.S. Government Sponsored Enterprises of $851.6 million and an
increase in long-term debt of $91.1 million, partially offset by a decrease in
accounts payable, accrued expenses and other liabilities of $90.5 million.

Liquidity

We expect to generate cash flows from operations to fund our business and to
meet our short-term liquidity requirements, which we define as the next twelve
months. As of December 31, 2020, we had $191.4 million of cash and cash
equivalents, $325.0 million of availability on our revolver and Nasdaq stock and
retained upside as described below.

On February 2, 2021, Nasdaq announced that it entered into a definitive
agreement to sell its U.S. Fixed income business to Tradeweb, the closing of
which will accelerate Newmark's receipt of the Nasdaq shares, subject to an
agreed upon present value discount (pursuant to the discounting adjustment
provisions set forth in the original purchase agreement). The exact number of
Nasdaq shares to be issued to Newmark in this accelerated issuance will depend
on the closing date of the transaction. Upon the closing of the Nasdaq
transaction, the Company's 2021 and 2022 Nasdaq Forwards are expected to
accelerate and settle. Net of the Nasdaq Forward settlement, Newmark estimates
it will receive approximately 5.0 million shares of Nasdaq stock, worth
approximately $723.5 million, based on the closing price of Nasdaq shares on
February 17, 2021.

Managing our multifamily GSE mortgage business through the pandemic
We are a lender for Multifamily, Seniors, Healthcare, Student, and Manufactured
Housing Community (MHC) assets through Fannie Mae, Freddie Mac, and FHA.
•These loans are guaranteed by the respective capital source and pre-sold by us
prior to the commitment of any corporate funds. We take no interest rate risk on
the origination and sale of these loans.
•The pre-sold loans are funded at a 100% advance rate via bank warehouse
facilities and are generally held for a period of 30-45 days prior to the
consummation of a sale at an annualized carry rate of approximately 50 basis
points. As of December 31, 2020, we had $1.8 billion of warehouse loan funding
available through multiple banking partners of which $900.0 million were
temporary increases which expired in February 2021.
•We also service loans for Fannie Mae, Freddie Mac, FHA, and various life
insurance companies, banks, CMBS and other lenders.
•We share credit losses on a pari passu basis with Fannie Mae (weighted average
loss sharing is approximately 30%) on our $24.0 billion portfolio. In the event
of an actual credit loss, all losses are allocated between the two parties based
on the contractual loss sharing arrangement. Although we share credit losses on
our Fannie Mae DUS portfolio, we view our originated servicing portfolio to be
conservative in terms of relevant credit metrics such as debt service coverage,
original loan-to-value and market and borrower quality.
                                       82
--------------------------------------------------------------------------------

Following enactment of the Coronavirus Aid, Relief, and Economic Security Act
(the "CARES Act") on March 27, 2020, Fannie Mae, Freddie Mac and Ginnie Mae
announced forbearance of loan payment programs. Newmark only has advancing
obligations under Fannie Mae and Ginnie Mae. Effective July 1, 2020, Fannie
announced an update to their forbearance of loan payment program:
•Forbearance may be granted for an additional three months of loan payments (for
a total of six months). To be eligible, borrower must be in compliance with
existing forbearance and demonstrate a hardship directly related to COVID-19.
•While the forbearance rate remains difficult to predict, we would be required
to advance up to $4.7 million for each 1% increase in the forbearance rate based
on the CARES Act forbearance period.
•As of December 31, 2020, Newmark had four loans totaling $53.5 million in
outstanding principal balance where we have $0.4 million in outstanding
servicing advances.
•Newmark has a $125 million line of credit with Bank of America within its
$400.0 million warehouse facility to fund principal and interest servicing
advances during the forbearance period related to the CARES Act.
•We have a contractual right to be reimbursed in full by Fannie Mae and Ginnie
Mae for all servicer advances made during the COVID-19 forbearance program.

Long-term debt
Long-term debt consisted of the following (in thousands):
                                                  December 31,
                                              2020           2019
                     6.125% Senior Notes   $ 542,772      $ 540,377
                     Credit Facility         137,613         48,917
                     Total                 $ 680,385      $ 589,294



6.125% Senior Notes
On November 2, 2018, Newmark announced the pricing of an offering of $550.0
million aggregate principal amount of 6.125% Senior Notes due 2023, which closed
on November 6, 2018. The 6.125% Senior Notes were offered and sold in a private
offering exempt from the registration requirements under the Securities Act. The
6.125% Senior Notes are general senior unsecured obligations of Newmark. These
6.125% Senior Notes were priced at 98.94% to yield 6.375%. The 6.125% Senior
Notes bear an interest rate of 6.125% per annum, payable on each May 15 and
November 15, beginning on May 15, 2019 and will mature on November 15, 2023. The
6.125% Senior Notes were subsequently exchanged for notes with substantially
similar terms that were registered under the Securities Act.

Credit Facility
On November 28, 2018, Newmark entered into the Credit Agreement by and among
Newmark, the several financial institutions from time to time party thereto, as
Lenders, and Bank of America N.A., as administrative agent. The Credit Agreement
was amended on February 26, 2020 to increase the size of the facility and extend
the maturity date to February 26, 2023. The Amended Credit Agreement provided
for a $425.0 million three-year unsecured senior revolving credit facility. The
Credit Agreement was again amended on March 16, 2020 to increase the size of the
facility. The Amended Credit Agreement provides for a $465.0 million three-year
unsecured senior revolving credit facility. As of December 31, 2020, the
carrying value of borrowings outstanding under the Amended Credit Agreement was
$137.6 million. Borrowings under the Amended Credit Facility will bear an annual
interest equal to, at Newmark's option, either (a) London Interbank Offered Rate
("LIBOR") for specified periods, or upon the consent of all Lenders, such other
period that is 12 months or less, plus an applicable margin, or (b) a base rate
equal to the greatest of (i) the federal funds rate plus 0.5%, (ii) the prime
rate as established by the administrative agent, and (iii) one-month LIBOR plus
1.0%. The applicable margin is 1.75% with respect to LIBOR borrowings and 0.75%
with respect to base rate borrowings, both of which can be up to 0.50% higher
depending upon Newmark's credit rating. The Amended Credit Facility also
provides for an unused facility fee. During the year ended December 31, 2020,
Newmark drew $365.0 million and on the Credit Facility and paid down
$275.0 million.

Cantor Credit Agreement
On November 30, 2018, Newmark entered into an unsecured credit agreement with
Cantor. The Cantor Credit Agreement provides for each party to issue loans to
the other party in the lender's discretion. Pursuant to the Cantor Credit
Agreement, the parties and their respective subsidiaries (with respect to CFLP,
other than BGC and its subsidiaries) may borrow up to an aggregate principal
amount of $250.0 million from each other from time to time at an interest rate
which is the higher of CFLP's or Newmark's short-term borrowing rate then in
effect, plus 1.0%. As of December 31, 2020, there were no borrowings outstanding
under the Cantor Credit Agreement.

                                       83
--------------------------------------------------------------------------------

Warehouse Facilities Collateralized by U.S. Government Sponsored Enterprises
As of December 31, 2020, Newmark had $1.8 billion of committed loan funding
available through three commercial banks and an uncommitted $400.0 million
Fannie Mae loan repurchase facility. Consistent with industry practice, these
warehouse facilities are short-term, requiring annual renewal. These warehouse
facilities are collateralized by an assignment of the underlying mortgage loans
originated under its various lending programs and third-party purchase
commitments and are recourse only to our wholly-owned subsidiary, Berkeley Point
Capital, LLC. As of December 31, 2020 and 2019, we had $1.1 billion and $209.6
million outstanding under "Warehouse facilities collateralized by U.S.
Government Sponsored Enterprises" on our accompanying consolidated balance
sheets.

Cash Flows
Cash flows from operations excluding activity from loan originations and sales,
net were as follows (in thousands):
                                                                         

Year Ended December 31,

                                                                             2020                  2019                 2018
Net cash provided by (used in) operating activities                     $   

(777,694) $ 986,761 $ (332,367) Add back: Loan originations - loans held for sale

                                   12,374,231            8,783,225            8,612,671
Loan sales - loans held for sale                                         

(11,527,010) (9,563,973) (8,002,872) Unrealized gains on loans held for sale

                                       24,295                5,174               18,430

Net cash provided by operating activities excluding activity from loan originations and sales (1)(2)

                        $   

93,822 $ 211,187 $ 295,862

(1) Includes payments for corporate taxes in the amount of $80.3 million, $95.1
million and $1.2 million for the years ended December 31, 2020, 2019 and 2018,
respectively.
(2) Includes payments to employees and partners of $127.9 million, $161.9
million and $109.6 million for the years ended December 31, 2020, 2019 and 2018,
respectively.
Cash Flows for the Year Ended December 31, 2020
For the year ended December 31, 2020, we used $777.7 million of cash for
operations. However, excluding activity from loan originations and sales, net
cash used by operating activities for the year ended December 31, 2020 was $93.8
million. We had consolidated net income of $109.3 million, $146.6 million of
positive adjustments to reconcile net income to net cash used by operating
activities (excluding activity from loan originations and sales) and
$162.0 million of negative changes in operating assets and liabilities. The
negative change in operating assets and liabilities included $127.9 million of
increases in loans, forgivable loans and other receivables from employees, a
$123.7 million decrease in receivables, net, a $82.4 million decrease in
accounts payable, accrued expenses and other liabilities, and a $75.4 million
decrease in accrued compensation. Cash used in investing activities was $3.6
million, primarily related to $34.7 million of proceeds from the sale of
marketable securities, partially offset by $19.6 million in purchases of fixed
assets, $12.8 million for the purchase of a debt security, and $5.9 million of
payments for acquisitions, net of cash acquired. Cash provided by financing
activities of $817.8 million primarily related to $851.6 million of net
borrowings on the warehouse facilities collateralized by U.S. Government
Sponsored Enterprises, and $365.0 million borrowing under the Credit Facility,
partially offset by $275.0 million repayment on the Credit Facility, $81.9
million in earning distributions to limited partnership interests and other
noncontrolling interests, and $23.2 million in dividends to stockholders.

Cash Flows for the Year Ended December 31, 2019
For the year ended December 31, 2019, we generated $986.8 million of cash from
operations. Excluding activity from loan originations and sales, net cash
provided by operating activities for the year ended December 31, 2019 was $211.2
million. We had consolidated net income of $161.7 million, $222.6 million of
positive adjustments to reconcile net income to net cash provided by operating
activities (excluding activity from loan originations and sales) and $173.1
million of negative changes in operating assets and liabilities. The negative
change in operating assets and liabilities included $161.9 million of increases
in loans, forgivable loans and other receivables from employees and partners
primarily related to continued hiring and expansion of our business, $113.2
million of increases in other assets, and $52.0 million of increase in
receivables, net, offset by an increase of $130.7 million in accounts payable,
accrued expenses and other liabilities and an increase of $23.4 million in
payables to related parties. Cash used in investing activities was $56.8
million, primarily related to $34.5 million in purchases of fixed assets, $33.9
million of payments for acquisitions, net of cash acquired, $28.0 million in
purchases of non-marketable investments, net, partially offset by $32.6 million
of proceeds from the sale of marketable securities, and $8.6 million of
distributions from Real Estate L.P. We used $895.5 million of cash from
financing activities primarily due to net repayments on the warehouse facilities
collateralized by U.S. Government Sponsored Enterprises of $762.7 million,
distributions to limited partnership interests and other noncontrolling
interests of $140.6 million, dividends to stockholders of $69.2 million and
treasury stock repurchases of $37.4 million, partially offset by net borrowings
under the Credit Facility of $50.0 million, the settlement of pre-Spin-Off
related party receivables of $33.9 million, and proceeds from securities loaned
of $36.7 million.

                                       84
--------------------------------------------------------------------------------

Cash Flows for the Year Ended December 31, 2018
For the year ended December 31, 2018, we used $332.4 million of cash from
operations. However, excluding activity from loan originations and sales, net
cash provided by operating activities for the year ended December 31, 2018 was
$295.9 million. We had consolidated net income of $191.9 million, $149.9 million
of positive adjustments to reconcile net income to net cash provided by
operating activities (excluding activity from loan originations and sales) and
$45.9 million of negative changes in operating assets and liabilities. The
negative change in operating assets and liabilities included $109.6 million of
increases in loans, forgivable loans and other receivables from employees and
partners primarily related to continued hiring and expansion of our business and
$129.5 million of increases in receivables related to acquisitions and increased
revenues, offset by increase of $203.1 million in accounts payable, accrued
expenses and other liabilities. Cash provided by investing activities was $7.7
million, primarily related to $95.9 million of proceeds from the sale of
marketable securities, partially offset by $34.5 million of payments for
acquisitions, $29.5 million in non-marketable investments and $21.0 million of
purchases of fixed assets. We generated $338.6 million cash from financing
activities primarily due to net proceeds from warehouse facilities
collateralized by U.S. Government Sponsored Enterprises of $611.9 million, of
$242.0 million of proceeds from and proceeds from BGC's 2018 investment in
Newmark, net proceeds from 6.125% Senior Notes of $537.5 million, $262.2 million
proceeds from the Newmark OpCo Preferred Investment, partially offset by
distributions to limited partnership interest and noncontrolling interests of
$46.5 million, and dividends of $41.8 million, and $1,156.0 million repayment of
long-term debt.

Credit Ratings

As of December 31, 2020, our public long-term credit ratings and associated outlooks are as follows:

                                                   Rating       Outlook
                    Fitch Ratings Inc.              BBB-        Stable
                    JCRA                            BBB+        Stable
                    Kroll Bond Rating Agency        BBB-        Stable
                    Standard & Poor's               BB+        Negative



Credit ratings and associated outlooks are influenced by several factors,
including but not limited to: operating environment, earnings and profitability
trends, the prudence of funding and liquidity management practices, balance
sheet size/composition and resulting leverage, cash flow coverage of interest,
composition and size of the capital base, available liquidity, outstanding
borrowing levels and the firm's competitive position in the industry. A credit
rating and/or the associated outlook can be revised upward or downward at any
time by a rating agency if such rating agency decides that circumstances warrant
such a change. Any reduction in our credit ratings and/or the associated outlook
could adversely affect the availability of debt financing on terms acceptable to
us, as well as the cost and other terms upon which we are able to obtain any
such financing. In addition, credit ratings and associated outlooks may be
important to customers or counterparties when we compete in certain markets and
when we seek to engage in certain transactions. In connection with certain
agreements, interest rates on our notes may incur increases of up to 2% in the
event of a credit ratings downgrade.

Regulatory Requirements
Newmark is subject to various capital requirements in connection with
seller/servicer agreements that Newmark has entered into with the various GSEs.
Failure to maintain minimum capital requirements could result in Newmark's
inability to originate and service loans for the respective GSEs and could have
a direct material adverse effect on our accompanying consolidated financial
statements. As of December 31, 2020, Newmark has met all capital requirements.
As of December 31, 2020, the most restrictive capital requirement was Fannie
Mae's net worth requirement. Newmark exceeded the minimum requirement by $357.8
million.

Certain of Newmark's agreements with Fannie Mae allow Newmark to originate and
service loans under Fannie Mae's Delegated Underwriting and Servicing ("DUS")
Program. These agreements require Newmark to maintain sufficient collateral to
meet Fannie Mae's restricted and operational liquidity requirements based on a
pre-established formula. Certain of Newmark's agreements with Freddie Mac allow
Newmark to service loans under Freddie Mac's Targeted Affordable Housing ("TAH")
Program. These agreements require Newmark to pledge sufficient collateral to
meet Freddie Mac's liquidity requirement of 8% of the outstanding principal of
TAH loans serviced by Newmark. As of December 31, 2020 and December 31, 2019,
Newmark has met all liquidity requirements.

In addition, as a servicer for Fannie Mae, the Government National Mortgage
Association ("Ginnie Mae") and FHA, Newmark is required to advance to investors
any uncollected principal and interest due from borrowers. As of December 31,
2020 and 2019, outstanding borrower advances were $0.8 million and $0.3 million,
respectively, and are included in "Other assets" in our accompanying
consolidated balance sheets.

                                       85
--------------------------------------------------------------------------------

On September 9, 2019, the U.S. Department of the Treasury issued a Housing
Reform Plan (the "Plan") in response to a March 27, 2019 Presidential Memorandum
soliciting reforms in the housing financing system designed to minimize taxpayer
exposure to future bailouts. The primary recommendations of the Plan are: (i)
that existing government support for the secondary markets should be explicitly
defined, tailored and paid for; (ii) that the GSEs' conservatorship should come
to an end; (iii) the implementation of reforms necessary to ensure that the
GSEs, and any successors, are appropriately capitalized to withstand a severe
economic downturn and that shareholders and unsecured creditors, rather than
U.S. taxpayers, bear the losses; (iv) that the GSEs should continue to support
affordable housing at a reasonable economic return that may be less than the
return earned on other activities; (v) that the FHFA and the U.S. Department of
Housing and Urban Development should clearly define the appropriate roles and
overlap between the GSEs and the Federal Housing Administration so as to avoid
duplication and (vi) that measures should be implemented to "level the playing
field" between the GSEs and private sector competitors. Additionally, in
September 2019, FHFA announced a cap of $200 billion as the maximum volume for
combined Fannie Mae and Freddie Mac multifamily volume through the end of 2020,
of which 37.5% must meet certain affordability requirements. The foregoing
proposals may have the effect of impacting the volume of business that we may do
with Fannie Mae and Freddie Mac. Additionally, the potential increase in our
proportion of affordable business and the potential implementation of a fee to
be charged in connection with the government's offer of a guarantee may alter
the economics of the business and, accordingly, may impact our financial
results.

See "Regulation" in Part II, Item 8 of this Annual Report on Form 10-K for additional information related to our regulatory environment.

Equity

Repurchase Program
On August 1, 2018, the Newmark Board of Directors and Audit Committee authorized
repurchases of shares of Newmark's Class A common stock and purchases of limited
partnership interests or other equity interests in Newmark's subsidiaries up to
$200 million. This authorization includes repurchases of stock or units from
executive officers, other employees and partners, including of BGC and Cantor,
as well as other affiliated persons or entities. For the year ended December 31,
2020, Newmark has repurchased 930,226 shares of Class A common stock at an
average price of $7.33. As of December 31, 2020, Newmark had $150.6 million
remaining from its share repurchase and unit purchase authorization. On February
17, 2021, our Board increased our share repurchase authorization to $400
million.

The following table details our share repurchase activity during 2020, including
the total number of shares purchased, the average price paid per share, the
number of shares repurchased as part of our publicly announced repurchase
program and the approximate value that may yet be purchased under such program
(in thousands except share and per share amounts):
                                                                                                                       Approximate
                                                                                                                       Dollar Value
                                                                                                                       of Units and
                                                                                                                       Shares That
                                              Total                    Average             Total Number of              May Yet Be
                                            Number of                 Price Paid          Shares Repurchased           Repurchased/
                                             Shares                    per Unit          as Part of Publicly            Purchased
Period                                Repurchased/Purchased            or Share           Announced Program           Under the Plan
Balance, January 1, 2020                   4,568,002                $      9.32               4,568,002             $       157,413
January 1, 2020 - March 31, 2020                   -                          -                       -
April 1, 2020 - June 30, 2020                      -                          -                       -
July 1, 2020 - September 30, 2020                  -                          -                       -
October 1, 2020 - December 31, 2020          930,226                       7.33                 930,226
Total                                      5,498,228                $      8.99               5,498,228             $       150,596




                                       86

--------------------------------------------------------------------------------

Fully Diluted Share Count
Our fully diluted weighted-average share count follows (in thousands):
                                                       December 31,
                                                 2020                 2019
              Common stock outstanding(1)     179,106               177,774
              Partnership units(2)             85,160                89,427
              RSUs (Treasury stock method)        355                 1,290
              Newmark exchange shares             230                   369

              Total(3)                        264,851               268,860


(1)Common stock consisted of Class A shares and Class B shares. For the year
ended December 31, 2020, the weighted-average number of Class A shares was
$157.8 million shares and Class B shares was 21.3 million that were included in
our fully diluted EPS computation because the conditions for issuance had been
met by the end of the period.
(2)Partnership units collectively include founding/working partner units,
limited partnership units, and Cantor units, (see Note 2 - "Limited Partnership
Interests in Newmark Holdings and BGC Holdings", to our Consolidated Financial
Statements in Part II, Item 8 of this Annual Report on Form 10-K for more
information). In general, these partnership units are potentially exchangeable
into shares of Newmark Class A common stock. In addition, partnership units held
by Cantor are generally exchangeable into shares of Newmark Class A common stock
and/or for up to 22.7 million shares of Newmark Class B common stock. These
partnership units also generally receive quarterly allocations of net income,
after the deduction of the Preferred Distribution, based on their
weighted-average pro rata share of economic ownership of the operating
subsidiaries. As a result, these partnership units are included in the fully
diluted share count calculation shown above.
(3)For the year ended December 31, 2020, the weighted-average share count
includes 85.2 million potentially anti-dilutive securities, which were excluded
in the computation of fully diluted earnings per share.

Our fully diluted period-end (spot) share count were as follows (in thousands):
                                                     December 31,
                                               2020                 2019
                Common stock outstanding    182,461               177,551
                Partnership units            79,666                82,380
                Newmark RSUs                      -                     -
                Newmark exchange shares         226                   238
                Other                           363                   674
                Total                       262,716               260,843




Contingent Payments Related to Acquisitions
Newmark completed acquisitions for which contingent cash consideration of $18.8
million. The contingent cash liability is recorded at fair value as deferred
consideration on our accompanying consolidated balance sheets.

Equity Method Investments
Newmark has an investment in Real Estate LP, a joint venture with Cantor in
which Newmark has a less than majority ownership and has the ability to exert
significant influence over the operating and financial policies. As of December
31, 2020, Newmark had $88.3 million in this equity method investment, which
represents a 27% ownership in Real Estate LP.

Registration Statements
On March 28, 2019, we filed a registration statement on Form S-3 pursuant to
which CF&Co may make offers and sales of our 6.125% Senior Notes in connection
with ongoing market-making transactions which may occur from time to time. Such
market-making transactions in these securities may occur in the open market or
may be privately negotiated at prevailing market prices at a time of resale or
at related or negotiated prices. Neither CF&Co, nor any of our affiliates, has
any obligation to make a market in our securities, and CF&Co or any such other
affiliate may discontinue market-making activities at any time without notice.
Newmark does not receive any proceeds from market-making activities in these
securities by CF&Co (or any of its affiliates).

We have an effective registration statement on Form S-4, with respect to the
offer and sale of up to 20.0 million shares of our Class A common stock from
time to time in connection with business combination transactions, including
acquisitions of other businesses, assets, properties or securities. As of
December 31, 2020, we have issued 0.6 million shares of our Class A common stock
under this registration statement.


                                       87
--------------------------------------------------------------------------------

Contractual Obligations and Commitments

The following table summarizes certain of Newmark's contractual obligations at December 31, 2020 (in thousands):

                                                                                                                                            More than 5
                                                        Total              Less than 1 Year          1-3 Years           3-5 Years             Years
Operating leases (1)                                $   329,334          $          45,701          $  82,579          $   74,386          $  126,668
Warehouse facilities collateralized by
U.S. Government Sponsored
Enterprises(2)                                        1,061,202                  1,061,202                  -                   -                   -
Long-term debt(3)                                       690,000                          -            690,000                   -                   -
Interest in long-term debt(4)                           102,503                     36,339             66,164                   -                   -
Interest on warehouse facilities
collateralized by U.S. Government
Sponsored Enterprises(5)                                  1,062                      1,062                  -                   -                   -
Total contractual obligations                       $ 2,184,101          $  

1,144,304 $ 838,743 $ 74,386 $ 126,668

(1)Operating lease are related to rental payments under various non-cancelable
leases principally for office space.
(2)Warehouse facilities are collateralized by $1,086.8 million of loans held for
sale, at fair value (See Note 21 - "Warehouse Facilities Collateralized by U.S.
Government Sponsored Enterprises" to our accompanying Consolidated Financial
Statements in Part II, Item 8 of this Annual Report on Form 10-K) which loans
were either under commitment to be purchased by Freddie Mac or had confirmed
forward trade commitments for the issuance of and purchase of Fannie Mae or
Ginnie Mae mortgage-backed securities.
(3)Long-term debt reflects long-term borrowings of $550.0 million 6.125% Senior
Notes. The carrying amount of these notes was approximately $542.8 million.
Long-term debt also includes the borrowings under the Credit Facility, which is
assumed to be outstanding until the maturity date of the Credit Facility. The
carrying amount of the borrowing under the Credit Facility is $137.6 million.
(See Note 22 - "Long-Term Debt" to our accompanying Consolidated Financial
Statements in Part II, Item 8 of this Annual Report on Form 10-K.)
(4)Reflects interest on the $550.0 million 6.125% Senior Notes until their
maturity date of November 15, 2023, in addition to the borrowings of $140.0
million assumed to be outstanding until the maturity date of the Credit
Facility. Interest on the borrowings under the Credit Facility was projected
using the 1-month LIBOR rate plus 175 basis points.
(5)Interest on the warehouse facilities collateralized by U.S. Government
Sponsored Enterprises was projected by using by using the 1-month LIBOR rate
plus their respective additional basis points, primarily 140 basis points above
LIBOR, applied to their respective outstanding balances as of December 31, 2020,
through their respective maturity dates. Their respective maturity dates range
from June 2021 to October 2021, while one line has an open maturity date.. The
notional amount of these committed warehouse facilities was $2.2 billion at
December 31, 2020. One of the warehouse lines established a $125 million
sublimit line of credit to fund potential principal and interest servicing
advances on the Company's Fannie Mae portfolio during the forbearance period
related to the CARES Act. Advances will have an interest rate of 1-month LIBOR
plus 200 bps. There were no outstanding draws on this sublimit at December 31,
2020. One warehouse line was temporarily increased by $300 million to $900
million for the period December 1, 2020 to February 1, 2021

As of December 31, 2020 and 2019, Newmark was committed to fund approximately
$0.4 billion and $1.5 billion, respectively, which is the total remaining draws
on construction loans originated by Newmark under the Housing and Urban
Development ("HUD") 221(d)4, 220 and 232 programs, rate locked loans that have
not been funded, and forward commitments, as well as the funding for Fannie Mae
structured transactions. Newmark also has corresponding commitments to sell
these loans to various purchasers as they are funded.

Critical Accounting Policies and Estimates
The preparation of our accompanying consolidated financial statements in
conformity with U.S. GAAP guidance requires management to make estimates and
assumptions that affect the reported amounts of the assets and liabilities,
revenues and expenses, and the disclosure of contingent assets and liabilities
in our accompanying consolidated financial statements. These accounting
estimates require the use of assumptions about matters, some which are highly
uncertain at the time of estimation. To the extent actual experience differs
from the assumptions used, our accompanying consolidated balance sheets,
consolidated statements of operations and consolidated statements of cash flows
could be materially affected. We believe that of our significant accounting
policies, the following policies involve a higher degree of judgment and
complexity.

Revenue Recognition
We derive our revenues primarily through commissions from brokerage services,
gains from mortgage banking activities/originations, net, revenues from real
estate management services, servicing fees and other revenues. Revenue from
contracts with customers is recognized when, or as, we satisfy our performance
obligations by transferring the promised goods or services to the customers as
determined by when, or as, the customer obtains control of that good or service.
A performance obligation may be satisfied over time or at a point in time.
Revenue from a performance obligation satisfied over time is recognized by
measuring our progress in satisfying the performance obligation as evidenced by
the transfer of the goods or services to the customer. Revenue from a
performance obligation satisfied at a point in time is recognized at the point
in time when the customer obtains control over the promised good or service. The
amount of revenue recognized reflects the consideration we expect to be entitled
to in exchange for those promised goods or services (i.e., the "transaction
price"). In determining the transaction price, we consider consideration
promised in a contract that includes a variable amount, referred to as variable
consideration, and estimate the amount of consideration due to us. Additionally,
variable consideration is included in the transaction price only to the extent
that it is probable that a significant reversal in the amount of cumulative
revenue recognized will not occur. In determining when to include variable
consideration in the transaction price, we consider all
                                       88
--------------------------------------------------------------------------------

information (historical, current and forecast) that is available, including the
range of possible outcomes, the predictive value of past experiences, the time
period of when uncertainties expect to be resolved and the amount of
consideration that is susceptible to factors outside of our influence.

We also use third-party service providers in the provision of its services to
customers. In instances where a third-party service provider is used, we perform
an analysis to determine whether we are acting as a principal or an agent with
respect to the services provided. To the extent that we are acting as a
principal, the revenue and the expenses incurred are recorded on a gross basis.
In instances where we are acting as an agent, the revenue and expenses are
presented on a net basis within the revenue line item.

In some instances, we perform services for customers and incur out-of-pocket
expenses as part of delivering those services. Our customers agree to reimburse
us for those expenses, and those reimbursements are part of the contract's
transaction price. Consequently, these expenses and the reimbursements of such
expenses from the customer are presented on a gross basis because the services
giving rise to the out-of-pocket expenses do not transfer a good or service. The
reimbursements are included in the transaction price when the costs are
incurred, and the reimbursements are due from the customer.

MSRs, Net
We initially recognize and measure the rights to service mortgage loans at fair
value and subsequently measure them using the amortization method. We recognize
rights to service mortgage loans as separate assets at the time the underlying
originated mortgage loan is sold, and the value of those rights is included in
the determination of the gains on loans held for sale. Purchased MSRs, including
MSRs purchased from CCRE, are initially recorded at fair value, and subsequently
measured using the amortization method.

We receive up to a 3-basis point servicing fee and/or up to a 1-basis point
surveillance fee on certain Freddie Mac loans after the loan is securitized in a
Freddie Mac pool ("Freddie Mac Strip"). The Freddie Mac Strip is also recognized
at fair value and subsequently measured using the amortization method, but is
recognized as a MSR at the securitization date.

MSRs are assessed for impairment, at least on an annual basis, based upon the
fair value of those rights as compared to the amortized cost. Fair values are
estimated using a valuation model that calculates the present value of the
future net servicing cash flows. In using this valuation method, we incorporate
assumptions that management believes market participants would use in estimating
future net servicing income. The fair value estimates are sensitive to
significant assumptions used in the valuation model such as prepayment rates,
cost of servicing, escrow earnings rates, discount rates and servicing
multiples, which are affected by expectations about future market or economic
conditions derived, in part, from historical data. It is reasonably possible
that such estimates may change. We amortize the MSRs in proportion to, and over
the period of, the projected net servicing income. For purposes of impairment
evaluation and measurement, we stratify MSRs based on predominant risk
characteristics of the underlying loans, primarily by investor type (Fannie
Mae/Freddie Mac, FHA/GNMA, CMBS and other). To the extent that the carrying
value exceeds the fair value of a specific MSR strata, a valuation allowance is
established, which is adjusted in the future as the fair value of MSRs increases
or decreases. Reversals of valuation allowances cannot exceed the previously
recognized impairment up to the amortized cost.

Equity-Based and Other Compensation
Discretionary Bonus: A portion of our compensation and employee benefits expense
comprises discretionary bonuses, which may be paid in cash, equity, partnership
awards or a combination thereof. We accrue expense in a period based on revenues
in that period and on the expected combination of cash, equity and partnership
units. Given the assumptions used in estimating discretionary bonuses, actual
results may differ.

Restricted Stock Units: We account for equity-based compensation under the fair
value recognition provisions of U.S. GAAP guidance. Restricted stock units
(which we refer to as "RSUs") provided to certain employees are accounted for as
equity awards, and in accordance with U.S. GAAP guidance, we are required to
record an expense for the portion of the RSUs that is ultimately expected to
vest. Further, U.S. GAAP guidance requires forfeitures to be estimated at the
time of grant and revised, if necessary, in subsequent periods if actual
forfeitures differ from those estimates. Because significant assumptions are
used in estimating employee turnover and associated forfeiture rates, actual
results may differ from our estimates under different assumptions or conditions.

The fair value of RSU awards to employees is determined on the date of grant,
based on the fair value of our Class A common stock. Generally, RSUs granted by
us as employee compensation do not receive dividend equivalents; as such, we
adjust the fair value of the RSUs for the present value of expected forgone
dividends, which requires us to include an estimate of expected dividends as a
valuation input. This grant-date fair value is amortized to expense ratably over
the awards' vesting periods. For RSUs with graded vesting features, we have made
an accounting policy election to recognize compensation cost on
                                       89
--------------------------------------------------------------------------------

a straight-line basis. The amortization is reflected as non-cash equity-based compensation expense in our accompanying consolidated statements of operations.

Restricted Stock: Restricted stock provided to certain employees is accounted
for as an equity award, and as per U.S. GAAP guidance, we are required to record
an expense for the portion of the restricted stock that is ultimately expected
to vest. We have granted restricted stock that is not subject to continued
employment or service; however, transferability is subject to compliance with
our and our affiliates' customary non-compete obligations. Such shares of
restricted stock are generally saleable by partners in 5 to 10 years. Because
the restricted stock is not subject to continued employment or service, the
grant-date fair value of the restricted stock is expensed on the date of grant.
The expense is reflected as non-cash equity-based compensation expense in our
accompanying consolidated statements of operations.

Limited Partnership Units: Limited partnership units in Newmark Holdings and BGC
Holdings are held by Newmark employees and receive quarterly allocations of net
income and are generally contingent upon services being provided by the unit
holders. As discussed above, preferred units in Newmark Holdings and BGC
Holdings are not entitled to participate in partnership distributions other than
with respect to a distribution at a rate of either 0.6875% (which is 2.75% per
calendar year) or such other amount as set forth in the award documentation. The
quarterly allocations of net income to such limited partnership units are
reflected as a component of compensation expense under "Equity-based
compensation and allocations of net income to limited partnership units and
FPUs" in our accompanying consolidated statements of operations.

Certain of these limited partnership units entitle the holders to receive
post-termination payments equal to the notional amount in four equal yearly
installments after the holder's termination. These limited partnership units are
accounted for as post-termination liability awards under U.S. GAAP guidance,
which requires that Newmark record an expense for such awards based on the
change in value at each reporting period and include the expense in our
accompanying consolidated statements of operations as part of "Equity-based
compensation and allocations of net income to limited partnership units and
FPUs." The liability for limited partnership units with a post-termination
payout is included in "Other long-term liabilities" on our accompanying
consolidated balance sheets.

Certain limited partnership units held by Newmark employees are granted
exchangeability into Class A common stock or may be redeemed in connection with
the grant of shares of Class A common stock. At the time exchangeability is
granted, or the shares are issued, Newmark recognizes an expense based on the
fair value of the award on that date, which is included in "Equity-based
compensation and allocations of net income to limited partnership units and
FPUs" in our accompanying consolidated statements of operations.

Employee Loans: We have entered into various agreements with certain of our
employees and partners whereby these individuals receive loans that may be
either wholly or in part repaid from distributions that the individuals receive
on some or all of their limited partnership interests or may be forgiven over a
period of time. Cash advance distribution loans are documented in formal
agreements and are repayable in timeframes outlined in the underlying
agreements. We intend for these advances to be repaid in full from the future
distributions on existing and future awards granted. The allocations of net
income to the awards are treated as compensation expense and the proceeds from
distributions are used to repay the loan. The forgivable portion of any loans is
recognized as compensation expense in our accompanying consolidated statements
of operations over the life of the loan. We review the loan balances each
reporting period for collectability. If we determine that the collectability of
a portion of the loan balances is not expected, we recognize a reserve against
the loan balances. Actual collectability of loan balances may differ from our
estimates. As of December 31, 2020 and 2019, the aggregate balance of employee
loans, net of reserve, was $454.3 million and $403.7 million, respectively, and
is included as "Loans, forgivable loans and other receivables from employees and
partners, net" in our accompanying consolidated balance sheets. Compensation
expense for the above-mentioned employee loans for the years ended December 31,
2020, 2019 and 2018 were $73.6 million, $39.0 million, and $27.7 million,
respectively. The compensation expense related to these loans was included as
part of "Compensation and employee benefits" in our accompanying consolidated
statements of operations.

Goodwill

Goodwill is the excess of the purchase price over the fair value of identifiable
net assets acquired in a business combination. As prescribed in U.S. GAAP
guidance, Intangibles - Goodwill and Other Intangible Assets, goodwill is not
amortized, but instead is periodically tested for impairment. We review goodwill
for impairment on an annual basis during the fourth quarter of each fiscal year
or whenever an event occurs, or circumstances change that could reduce the fair
value of a reporting unit below its carrying amount.

When reviewing goodwill for impairment, we first assess qualitative factors to
determine whether it is more likely than not that the fair value of a reporting
unit is less than its carrying amount, including goodwill. If the results of the
qualitative
                                       90
--------------------------------------------------------------------------------

assessment indicate that it is more likely than not that the fair value of a
reporting unit is less than its carrying amount, or if we choose to bypass the
qualitative assessment, we perform a quantitative goodwill impairment analysis
as follows.

The quantitative goodwill impairment test, used to identify both the existence
of impairment and the amount of impairment loss, compares the fair value of a
reporting unit with its carrying amount, including goodwill. If the carrying
amount of a reporting unit exceeds its fair value, an impairment loss should be
recognized in an amount equal to that excess, limited to the total amount of
goodwill allocated to that reporting unit. If the estimated fair value of a
reporting unit exceeds its carrying value, goodwill is deemed not to be
impaired. To estimate the fair value of the reporting unit, we use a discounted
cash flow model and data regarding market comparables. The valuation process
requires significant judgment and involves the use of significant estimates and
assumptions. These assumptions include cash flow projections, estimated cost of
capital and the selection of peer companies and relevant multiples. Because
significant assumptions and estimates are used in projecting future cash flows,
choosing peer companies and selecting relevant multiples, actual results may
differ from our estimates under different assumptions or conditions.

Credit Losses
The CECL methodology, which became effective on January 1, 2020, requires us to
estimate lifetime expected credit losses by incorporating historical loss
experience, as well as current and future economic conditions over a reasonable
and supportable period beyond the balance sheet date. The adoption of CECL
resulted in the recognition of reserves relating to our loss sharing guarantee
provided to Fannie Mae under the DUS Program which was previously accounted for
under the incurred loss model, which generally required that a loss be incurred
before it was recognized. Additional reserves were recognized for our
receivables from customers including certain employee receivables carried at
amortized cost.

The expected credit loss is modeled based on our historical loss experience
adjusted to reflect current conditions. A significant amount of judgment is
required in the determination of the appropriate reasonable and supportable
period, the methodology used to incorporate current and future macroeconomic
conditions, determination of the probability of and exposure at default, all of
which are ultimately used in measuring the quantitative components of our
reserves. Beyond the reasonable and supportable period, we estimate expected
credit losses using our historical loss rates. We also consider whether to
adjust the quantitative reserves for certain external and internal qualitative
factors, which consequentially may increase or decrease the reserves for credit
losses and receivables. In order to estimate credit losses, assumptions about
current and future economic conditions are incorporated into the model using
multiple economic scenarios that are weighted to reflect the conditions at each
measurement date.

During the year ended December 31, 2020, there was a significant increase in our
reserves due to adverse changes in the macroeconomic forecast caused by
COVID-19. Macroeconomic forecasts are critical inputs into our model and
material movements in variables such as, the U.S. unemployment rate and U.S. GDP
growth rate could significantly affect our estimated expected credit losses.
These macroeconomic forecasts, under different conditions or using different
assumptions or estimates, could result in significantly different changes in
reserves for credit losses. It is difficult to estimate how potential changes in
specific factors might affect the overall reserves for credit losses and current
results may not reflect the potential future impact of macroeconomic forecast
changes.

Income Taxes
Newmark accounts for income taxes using the asset and liability method as
prescribed in U.S. GAAP guidance, Income Taxes. Deferred tax assets and
liabilities are recognized for the future tax consequences attributable to basis
differences between our accompanying consolidated financial statement carrying
amounts of existing assets and liabilities and their respective tax basis.
Certain of Newmark's entities are taxed as U.S. partnerships and are subject to
UBT in New York City. Therefore, the tax liability or benefit related to the
partnership income or loss except for UBT rests with the partners, rather than
the partnership entity. As such, the partners' tax liability or benefit is not
reflected in our accompanying consolidated financial statements. The tax-related
assets, liabilities, provisions or benefits included in our accompanying
consolidated financial statements also reflect the results of the entities that
are taxed as corporations, either in the U.S. or in foreign jurisdictions.

Newmark provides for uncertain tax positions based upon management's assessment
of whether a tax benefit is more likely than not to be sustained upon
examination by tax authorities. Management is required to determine whether a
tax position is more likely than not to be sustained upon examination by tax
authorities, including resolution of any related appeals or litigation
processes, based on the technical merits of the position. Because significant
assumptions are used in determining whether a tax benefit is more likely than
not to be sustained upon examination by tax authorities, actual results may
differ from Newmark's estimates under different assumptions or conditions.
Newmark recognizes interest and penalties related to uncertain tax positions in
"Provision for income taxes" in our accompanying consolidated statements of
operations.

A valuation allowance is recorded against deferred tax assets if it is deemed
more likely than not that those assets will not be realized. In assessing the
need for a valuation allowance, Newmark considers all available evidence,
including past
                                       91
--------------------------------------------------------------------------------

operating results, the existence of cumulative losses in the most recent fiscal
years, estimates of future taxable income and the feasibility of tax planning
strategies.

The measurement of current and deferred income tax assets and liabilities is
based on provisions of enacted tax laws and involves uncertainties in the
application of tax regulations in the U.S. and other tax jurisdictions. Because
Newmark's interpretation of complex tax law may impact the measurement of
current and deferred income taxes, actual results may differ from these
estimates under different assumptions regarding the application of tax law.

Derivative Financial Instruments
We have loan commitments to extend credit to third parties. The commitments to
extend credit are for mortgage loans at a specific rate (rate lock commitments).
These commitments generally have fixed expiration dates or other termination
clauses and may require a fee. We are committed to extend credit to the
counterparty as long as there is no violation of any condition established in
the commitment contracts.

We simultaneously enter into an agreement to deliver such mortgages to third-party investors at a fixed price ("forward sale contracts").

Both the commitment to extend credit and the forward sale commitment qualify as
derivative financial instruments. We recognize all derivatives on our
accompanying consolidated balance sheets as assets or liabilities measured at
fair value. The change in the derivatives fair value is recognized in current
period earnings.

Newmark entered into variable postpaid forward contracts as a result of the
Nasdaq Forwards. These contracts qualify as derivative financial instruments.
The Nasdaq Forwards provide Newmark with the ability to redeem the EPUs for
Nasdaq stock, and as these instruments are not legally detachable, they
represent single financial instruments. The financial instruments' EPU
redemption feature for Nasdaq shares is not clearly and closely related to the
economic characteristics and risks of Newmark's EPU equity host instruments,
and, therefore, it represents an embedded derivative that is required to be
bifurcated and recorded at fair value on our accompanying consolidated balance
sheets, with all changes in fair value recorded as a component of "Other income
(loss), net" on our accompanying consolidated statements of operations. See Note
11 - "Derivatives", to our accompanying Consolidated Financial Statements in
Part II, Item 8 of this Annual Report on Form 10-K for additional information.

Recent Accounting Pronouncements
See Note 1 - "Organization and Basis of Presentation", to our accompanying
Consolidated Financial Statements in Part II, Item 8 of this Annual Report on
Form 10-K, for information regarding recent accounting pronouncements.

Unit Redemptions and Exchanges - Executive Officers In connection with the Company's 2019 executive compensation process, the Company's executive officers received certain monetization of prior awards as compensation at Newmark, as set forth below.

On December 19, 2019, the Compensation Committee approved the right to (i)
convert 552,483 non-exchangeable Newmark Holdings PSUs held by Mr. Lutnick into
552,483 HDUs (which, based on the closing price of the Class A common stock of
$13.61 per share on such date, had a value of $7,017,000); and (ii) exchange for
cash 602,463 Newmark Holdings non-exchangeable PPSUs held by Mr. Lutnick (which
had an average determination price of $13.25 per unit)for a payment of
$7,983,000 for taxes when (i) is exchanged. On December 19, 2019, the
Compensation Committee approved the right to (i) convert 443,872
non-exchangeable Newmark Holdings PSUs held by Mr. Gosin into 443,872 HDUs
(which, based on the closing price of the Class A common stock of $13.61 per
share on such date, had a value of $5,637,548); and (ii) exchange for cash
539,080 Newmark Holdings non-exchangeable PPSUs held by Mr. Gosin (which had an
average determination price of $9.95 per unit) for a payment of $5,362,452 for
taxes when (i) is exchanged. On December 19, 2019, the Compensation Committee
approved the cancellation of 145,464 non-exchangeable Newmark Holdings PSUs held
by Mr. Merkel, and the cancellation of 178,179 non-exchangeable PPSUs (which had
an average determination price of $10.61 per unit). Additionally, on December
19, 2019, Mr. Merkel exchanged 4,222 already exchangeable Newmark Holdings PSUs
held by him in exchange for Class A common stock. The above transaction resulted
in income of $3,791,848 for Mr. Merkel, of which the Company withheld $1,989,483
for taxes and issued the remaining $1,802,365 in the form of 132,429 net shares
of Class A common stock at a price of $13.61 per share. On December 19, 2019,
the Compensation Committee approved the right to (i) convert 5,846
non-exchangeable Newmark Holdings PSUs held by Mr. Rispoli into 5,846 HDUs
(which, based on the closing price of the Class A common stock of $13.61 per
share on such date, had a value of $74,250); and (ii) exchange for cash 4,917
Newmark Holdings non-exchangeable PPSUs held by Mr. Rispoli (which had an
average determination price of $12.355 per unit) for a payment of $60,750 for
taxes when (i) is exchanged.

                                       92

--------------------------------------------------------------------------------

© Edgar Online, source Glimpses