Corcoran absorbs Citi Habitats as Corcoran/Compass war heats up (and other mergers)

David Goldsmith

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Noah Rosenblatt

Talking Manhattan on UrbanDigs.com
Staff member
agree. I like the move, Corcoran was the better brand. Def cost savings, looks like they will consolidate and close at least a few offices. Its the big 3 (corcoran, elliman, and the terra twins) vs Compass I guess now
 

David Goldsmith

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"For eight months, Realogy and Compass have been trading barbs in a wide-ranging suit over illicit business practices and predatory poaching. But whether or not the two brokerage giants enter arbitration is the latest battleground in their legal war."
 

David Goldsmith

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Terra next?
Brokerage giants Brown Harris Stevens, Halstead to merge
The combined firm will have 2,500 agents

Two of the biggest names in New York City residential brokerage are joining forces.
Sister companies Brown Harris Stevens and Halstead will merge under the BHS banner, owner Terra Holdings said Thursday. The combined firm will have 2,500 agents. Last year the brokerages’ sales totaled $9 billion, according to data from Real Trends.
The fusion of two mainstay brands — each with a distinctive company culture — comes amid consolidation in the industry and as residential firms look to dig themselves out of a hole deepend by coronavirus. Even before the pandemic, a slowdown in the luxury market squeezed already-thin brokerage margins.
In a statement, Terra COO Alan Kersner said the restructuring will expand Brown Harris Stevens’ footprint and resources as the housing market recovers.
According to Kersner, the transition will occur in phases, starting in New York. Brown Harris Stevens CEO Bess Freedman will be chief executive of the unified brokerage. Halstead CEO Diane Ramirez, who co-founded the firm in 1987, will stay on as a senior executive. So will BHS president Hall Willkie, Halstead president Richard Grossman and Terra Development Marketing president Stephen Kliegerman.
Kersner said BHS will keep its headquarters at 445 Park Avenue, but Terra didn’t disclose plans for Halstead’s flagship, a 17,000-square-foot space at 499 Park Avenue. The combined company will have 54 other offices in New York City and the Hamptons, Connecticut, New Jersey, Palm Beach and Miami.
Kersner, responding to questions via text message, said Terra’s goal is to retain as many employees as possible. The company also aims to keep legacy offices open, “as long as it makes sense financially.”
Although Terra will be able to shave off “procedural redundancies,” Kersner said the company will double down on technology and marketing.
“It’s no secret that the real estate industry has changed, especially with all of the aggregators and iBuyers now competing for business,” he said. “In order to stay competitive, brokerages have to adapt. This restructuring was not a spur of the moment decision, but the pandemic certainly forced us to act quickly.”
Arthur Zeckendorf, William Lie Zeckendorf, David Burris, Kent Swig, and Eric Hadar

Arthur Zeckendorf, William Lie Zeckendorf, David Burris, Kent Swig, and Eric Hadar
Terra — owned by Arthur Zeckendorf, William Lie Zeckendorf, Kent Swig, David Burris and Eric Hadar — has owned BHS and Halstead since 1995 and 2001, respectively.
Despite their common ownership, the firms have cornered different parts of the residential market. Established in 1873, BHS is a dominant player in the luxury market and has been for decades. The blue-blooded firm represented Jeff Bezos when the Amazon chief paid a record $80 million last year for a spread at 212 Fifth Avenue.
More than a century younger, Halstead has 32 offices, a strong rental division and is known for being more of a volume player on the sales side. By acquiring regional brokerages over the years, it has built a strong presence in the outer boroughs, Connecticut and New Jersey. Last year, Halstead closed $362.3 million sell-side deals in Brooklyn and $179.1 million in Queens, according to an analysis by The Real Deal.

Both BHS and Halstead — and their competitors — had to make strategic cuts during the pandemic. In April, Terra slashed executive pay and furloughed employees across the organization.
Executives say by joining forces, the combined organization will emerge stronger from an unprecedented few months in which brokerage was nearly shut down.
“As the real estate industry begins to reopen around the country, we are growing a company with a purposeful culture and incredible depth and breadth for the future,” Freedman said in a statement.
The deal gives the combined firm more muscle — more than 1,600 agents and $3.25 billion in sales — at the top of New York’s cutthroat brokerage business. Market-leader Douglas Elliman, with 2,460 agents, closed $7.96 billion sell-side deals in the metro area in 2019, according to TRD’s analysis. The Corcoran Group came next with $7.84 billion in sell-side sales, followed by Compass with $4.85 billion.
Pre-pandemic, the leaderboard saw a wave of consolidation. Last year, SoftBank-backed Compass acquired Stribling & Associates, one of the city’s last independent firms. And in January, Realogy’s Corcoran Group and Citi Habitats said they would formally merge after operating as “sister” companies for nearly two decades.
Smaller firms have also joined forces to retain profitability in a tight market, including Bond New York (which bought Caliber), Living New York (which merged with Mdrn. Residential) and Keller Williams Midtown (which was acquired and then merged with KW Tribeca).
 

John Walkup

Talking Manhattan on UrbanDigs.com
Right. Also makes an argument that brokerage culture as curated by agents and perceived by consumers is flexible, which puts middle/small brokerages in the crosshairs. I think the only move left for the remaining independent shops is niche specialties. Garfield = townhouse for example. But since there's only so much of that to go around, it's gonna get ugly.
 

David Goldsmith

All Powerful Moderator
Staff member

"For eight months, Realogy and Compass have been trading barbs in a wide-ranging suit over illicit business practices and predatory poaching. But whether or not the two brokerage giants enter arbitration is the latest battleground in their legal war."
 

David Goldsmith

All Powerful Moderator
Staff member
Oxford Property Group acquires Spire, expands to nearly 800 agents
Spire will continue as its own brand under Oxford’s umbrella

Oxford Property Group is continuing its acquisition run, most recently picking up residential brokerage Spire Group, which specializes in both sales and rentals.
The acquisition of Spire, the 115-agent firm led by co-founder Bianka Yankov until her death in April, closed in August. Combined, the two firms have 790 agents, according to Oxford CEO Adam Mahfouda. That’s a hefty jump from the 523 agents the firm had in March, according to The Real Deal’s annual brokerage ranking.

Mahfouda said the deal had been at least four years in the making, though he admitted the pandemic had accelerated talks and allowed the firms to overcome differences in pricing.
He declined to disclose the financial terms of the deal, but said that Spire would continue to operate under its name. Spire’s former director of operations Dina Tango is now Oxford’s chief financial officer.

Mahfouda said keeping Spire’s brand was partly an homage to Yankov and the company’s culture.

“We appreciate the work that Bianka had done and we didn’t want to tear that all down, out of respect for her,” he explained.
But it’s also a test to see whether Oxford could operate multiple brands underneath its umbrella. He said that maintaining a firm’s brand has come up several times when discussing other potential acquisitions.

“We’re trying to grow the firm even larger,” he said. “We’re growing organically but we’re really interested in acquiring or merging.”
Oxford acquired Kian Realty in late March and has been in talks with at least one other firm outside of the city about a merger in recent months.

Both Spire and Oxford are 100-percent commission firms, which Mahfouda said made combining forces easier. Now, Spire agents will choose from Oxford’s high-commission split model: either pay a monthly $495 fee and keep 100 percent of all deal commissions, or pay $99 a month and take a 90 percent split with the firm.

Mahfouda credited this structure with allowing Oxford to maintain all services for its agents, while other brokerages made deep cuts due to the pandemic.
“When a lot of the companies are pulling back on expenses and agents are coming to the office everyday, I think more agents will and should look toward a model like ours,” he said.

The other largest 100 percent commission firm is R New York, which had about 775 agents as of TRD’s March ranking.
 

Noah Rosenblatt

Talking Manhattan on UrbanDigs.com
Staff member
Hmm, I was wondering if Spire would merge with another firm since Bianka's passing. So so sad on that front and I miss my talks with her dearly. Im glad they will keep the Spire name, respectful. Thanks for posting this David
 
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