HighTower hires top recruiters from Schwab and LPL to help populate five new offices

HighTower Advisors has hired veteran recruiters from LPL Financial and Schwab Advisor Services as it eyes opening six offices in six cities in coming months.

The nabbing of Michael Parker and Kevin Geary from the industry’s largest independent broker-dealer and largest RIA custodian signals the swelling river of recruiting under way at HighTower.

The company current operates are consolidated in Chicago, New York and the Bay area [San Francisco and Menlo Park] with 29 advisors and $17 billion of AUM. HIghTower added an additional four partners in Watertown, N.Y. and $500 million over the holiday. See: HighTower veteran helps Morgan Stanley Smith Barney veteran break away upstate New York style

Boutique atmosphere

One industry observer who asked not to be named – and who allows that HighTower is ‘on fire’ — says the challenge that HighTower may face is that it supports a boutique atmosphere but as it gets bigger it could lose some of that distinctive feel.

Elliot Weissbluth, CEO of HighTower, says that it’s important to keep things in perspective. HighTower still only has 130 people in its employ.

“We have a long way to go” before being concerned about whether HighTower is still a boutique company, he says.

The Chicago-based aggregator is doubling the size of its Manhattan office and plans to open new offices in Boston, Washington D.C., Portland, Ore., Scottsdale, Ariz., San Diego and Los Angeles. The effort is stretching recruiters thin, according to Mike Papedis, HighTower’s managing director in charge of recruiting. He was hired Fidelity Investments earlier this year.

“Elliot [Weissbluth CEO of HighTower] and I have been all over the country and getting sleep-deprived,” he says.

HighTower’s intensifying recruiting schedule – particularly out West — is being driven by accelerating demand by big wirehouse advisors to learn more and consider joining HighTower, according to Weissbluth.

West Coast accelerated

“The interest on the West Coast accelerated and we had to do something about it,” he says. The existing West Coast offices are in Menlo Park, Calif. and San Francisco.

HighTower seeks teams with a minimum of $300 million of assets under management.

“People underestimate how many high-quality advisors there are,” Weissbluth says.

He hired Parker, who previously oversaw new business development at Boston- and San Diego-based LPL for the Northeast region from July 2009 to early September 2010. He focused exclusively on top–producing teams. Parker began in September to oversee HighTower’s advisor recruiting in the Eastern region from the company’s Manhattan office, which has 35 employees and recently doubled its office space to 22,000 square feet.

Before joining LPL, Parker had worked for 10 years as a financial advisor, branch manager and branch complex manager for Smith Barney – and his primary duty was recruiting talent from other wirehouses. He will take a big hand in opening the Boston and Washington D.C. offices.
Parker switched employers because of the direction he perceives HighTower to be headed.

Building for the future

“I wanted to be part of an organization building for the future, and the trend of high quality advisors leaving the major firms is increasing every month,” he said. LPL’s spokesman did do reply to a query regarding this departure.

Geary, a 17-year veteran of Schwab who recruited advisors on the West Coast, started work yesterday. He said being employed by HighTower, which uses Schwab as one of its major custody partners, will bring an edge to his efforts.

“Many top-notch wirehouse advisors do not want the distractions or risks of running their own business, they want a firm that cares about them and their clients,” Geary said.

The latter hire was an amiable poach because it is aimed at benefitting both Schwab and HighTower, according to Weissbluth.

“This certainly strengthens the partnership we have with Schwab,” he says.

Enhanced collaboration

Dave DeVoe, managing director, strategic business development for Schwab Advisor Services, said Geary will be an asset to HighTower. “In many ways, this will allow Schwab and Hightower to continue to build on our strong success in 2010 and enhance our collaboration, enabling greater numbers of advisors to make the move to independence.”

The hires make good strategic sense, according to John Furey, principal of Advisor Growth Strategies in Phoenix, Ariz., a company that helps facilitate breakaway transactions.