Marcus & Millichap, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Selected Balance Sheet Data (Tables)

Selected Balance Sheet Data (Tables)

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Allowance for Credit Losses for Advances and Loans and Commissions Receivable

Allowance for credit losses for advances and loans and commissions receivable consisted of the following (in thousands):


	Advances and Loans			Commissions Receivable			Total
Beginning balance as of January 1, 2021	$	563		$	94		$	657
Credit loss expense (recovery)		255			(89	)		166
Write-offs		(29	)		—			(29	)

Ending balance as of December 31, 2021	$	789		$	5		$	794


	Advances and Loans			Commissions Receivable			Total
Beginning balance as of January 1, 2020	$	512		$	32	(1)	$	544
Credit loss expense		126			62			188
Write-offs		(75	)		—			(75	)

Ending balance as of December 31, 2020	$	563		$	94		$	657

(1)	Includes cumulative-effect adjustment related to the adoption of ASU No. 2016-13, Financial Instruments—Credit Losses.

Schedule of Other Assets

Other assets consisted of the following (in thousands):


	Current December 31,				Non-Current December 31,
	2021		2020		2021		2020
MSRs, net of amortization	$	—	$	—	$	1,855	$	1,897
Security deposits		—		—		1,395		1,461
Employee notes receivable (1)		40		185		—		246
Securities, held-to-maturity (2)		—		—		9,500		—
Customer trust accounts and other		5,230		4,526		396		572

	$	5,270	$	4,711	$	13,146	$	4,176

(1)	Reduction of accrued bonuses and other employee related expenses in settlement of employee notes receivable were $10 and $0 for the years ended December 31, 2021 and 2020, respectively. See Note 8 – “Related-Party Transactions” for additional information.

(2)	Securities, held-to-maturity, are expected to mature on September 1, 2024 and accrues interest based on the 1 -year treasury rate.

Summary of Net Change in Carrying Value of MSRs

The net change in the carrying value of MSRs consisted of the following (in thousands):


	December 31,
	2021			2020
Beginning balance	$	1,897		$	2,002
Additions		483			441
Amortization		(525	)		(546	)

Ending balance	$	1,855		$	1,897

Schedule of Deferred Compensation and Commissions

Deferred compensation and commissions consisted of the following (in thousands):


	Current December 31,				Non-Current December 31,
	2021		2020		2021		2020
SARs liability (1)	$	2,241	$	2,162	$	14,918	$	16,671
Commissions payable to investment sales and financing professionals		110,769		54,082		31,697		15,306
Deferred compensation liability (1)		1,080		1,519		6,921		6,768
Other		595		343		—		—

	$	114,685	$	58,106	$	53,536	$	38,745

(1)

The SARs and deferred compensation liability become subject to payout as a result of a participant no longer being considered as a service provider. As a result of the retirement of certain participants, estimated amounts to be paid to the participants within the next twelve months have been classified as current.

Summary of Net Change in Carrying Value of Assets Held in Rabbi Trust and Deferred Compensation Liability

The net change in the carrying value of the assets held in the rabbi trust and the net change in the carrying value of the deferred compensation liability, each exclusive of additional contributions, distributions and trust expenses consisted of the following (in thousands):


	Years Ended December 31,
	2021		2020		2019
Increase in the carrying value of the assets held in the rabbi trust (1)	$	1,445	$	1,042	$	1,353

Increase in the net carrying value of the deferred compensation obligation (2)	$	1,104	$	799	$	1,293

(1)	Recorded in other income (expense), net in the consolidated statements of net and comprehensive income.

(2)	Recorded in selling, general and administrative expense in the consolidated statements of net and comprehensive income.

Summary of Other Liabilities

Other liabilities consisted of the following (in thousands):


	Non-Current December 31,
	2021		2020
Deferred consideration (1)(2)	$	4,689	$	8,582
Contingent consideration (1)(2)		6,631		4,219
Other		74		1,015

	$	11,394	$	13,816

(1)

The current portions of deferred consideration in the amounts of $5,112 and $6,666 as of December 31, 2021 and 2020, respectively, are included in accounts payable and other liabilities in the consolidated balance sheets. The current portions of contingent consideration in the amounts of $2,681 and $1,353 as of December 31, 2021 and 2020, respectively, are included in accounts payable and other liabilities in the consolidated balance sheets.

(2)	Includes a measurement period adjustment and a reduction in deferred consideration settled in stock made during the year ended December 31, 2021, which represents a noncash investing activity. See Note 6 – “Acquisitions, Goodwill and Other Intangible Assets” for additional information.