Company started encouraging Real Living franchises to change to Berkshire Hathaway HomeServices model in 2013.
Berkshire Hathaway affiliate HomeServices of America is winding down the Real Living Real Estate model, almost a decade after buying it.
Harley E. Rouda based Real Living in 2002. By 2004, Real Living was the third-largest privately owned residential brokerage within the United States. In September 2005, the agency had almost 5,000 gross sales associates and workers and greater than 140 places of work all through the Midwest, Florida, South Carolina, Texas and West Virginia.
Canadian-based Brookfield purchased Real Living in 2009 and merged it with GMAC Real Estate beneath the Real Living model. The merged Real Living operations added as much as about 10,000 brokers and 600 places of work in 46 states.
In October 2012, HomeServices entered the franchising enterprise by buying a majority curiosity within the Prudential Real Estate and Real Living manufacturers from Brookfield. HomeServices and Brookfield shaped a three way partnership, HSF Affiliates LLC, which continued to function the Real Living and Prudential Real Estate affiliate networks. But in March 2013, the corporate rolled out a brand new model they hoped can be adopted by brokerages affiliated with these manufacturers: Berkshire Hathaway HomeServices (BHHS). HomeServices had a mixed 53,000 brokers on the time.
All of HomeServices’ Prudential associates and plenty of Real Living associates did transition to the brand new model, however 154 Real Living places of work remained, in line with the franchisor’s 2020 Franchise Disclosure.
Now, HomeServices appears to have run out of endurance. Last week, Real Living CEO Allan Dalton despatched out an electronic mail to all Real Living franchise homeowners letting them know that the corporate was winding down using the model and would finish its efforts to develop the franchise community. He additionally delivered the identical remarks in a video.
“This determination was a really troublesome one to make, nevertheless we consider it’s the proper determination as a result of following main causes: our incapability to develop the Real Living community by means of new franchise gross sales and the departure of franchisees from the Real Living community, together with different brokerages advising us that they won’t search to resume their franchise relationships with Real Living,” Dalton stated.
“As you’ll be able to recognize, attracting new franchisees and retaining present members is the lifeblood of any franchise system.”
Dalton went on to say that Real Living representatives can be reaching out to broker-owners to begin working with them to debate choices for transitioning from the Real Living system “to the following chapter for his or her companies.”
For Thad McIntyre, broker-owner of PowerMark Properties in Biloxi, Mississippi, the information got here as a shock, however not essentially an unwelcome one.
“We all knew one thing was up,” McIntyre informed Inman by way of electronic mail. “There has been no actual contact from anybody from company for a number of months, however we didn’t know when [or] what can be taking place. Some thought it will be bought, some thought they might mix us to Berkshire and truthfully at present was a shocker!”
PowerMark Properties emblem
He joined Real Living in 2016 and nonetheless had 4 years left on his contract. “We haven’t seen the worth in years and really thought-about requesting them to terminate our settlement,” he stated. “So I assume it’s a blessing.”
McIntyre stated his brokerage wouldn’t be as affected as others as a result of when he signed up with Real Living he was allowed to make use of his PowerMark model and simply add “A Real Living Network Member” to his firm emblem.
Inman reached out to HSF Affiliates to ask what number of brokers and brokers are at the moment affiliated with the Real Living model, why the corporate has been unable to develop the model by means of new franchise gross sales, why franchisees have been departing, which transition choices can be found to franchise homeowners, how lengthy they’ll must transition and whether or not the corporate is shutting down the model with the intention to focus its sources on rising the Berkshire Hathaway HomeServices model.
The firm didn’t reply to the questions and as a substitute supplied an emailed assertion from Real Living: “Real Living Real Estate, LLC just lately introduced its determination to stop its efforts to develop the Real Living Real Estate community and to maneuver in the direction of winding down that model and system. Real Living is happy with its members and its objective shall be to help every member to make no matter transition path, from the choices recognized, that which is finest for his or her firm and as clean as potential.”
HomeServices is the biggest actual property brokerage within the U.S. by transaction sides and has about 46,000 brokers whole, in line with Real Trends.
Email Andrea V. Brambila.
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