Staying independent amid a flurry of Miami office acquisitions

One of the biggest trends in Miami real estate over the past few years has been the sharp increase of independent, small- to mid-sized residential real estate offices being acquired by large national companies. Big-pocketed firms who previously had no presence in South Florida suddenly have large footprints in our increasingly competitive marketplace, and it has changed the way local brokers, agents, and customers think about the buying and selling of real estate — as well as the future direction of our industry.

As an independent broker/owner of a successful Miami Beach office, I certainly understand and respect my colleagues’ decisions to join and/or sell their agency to a national company. These corporations have much to offer: brand recognition, cutting-edge technology, international networks of buyers and agents, the freedom to streamline operations and — let’s be real here — nice compensation packages for broker/owners who decide to sell! You can be sure I have also been approached to sell my company, and while the temptation is real, a number of important factors have always compelled me to politely decline (for now.)

▪ Agent freedom: I have 25 wonderful agents in my office, many of whom came to me from large, national real estate companies whose names you would certainly recognize. A big motivation for them to join and remain in my office is the freedom to market and sell properties how they see fit, within reason but without concern for onerous corporate regulations weighing them down. (This is a natural advantage that independent agencies have over larger competitors.) In a unique market like Miami, where many factors can distinguish agents from their competitors, my agents truly appreciate this flexibility. While I may not be able to offer some of the technological, marketing, or networking benefits of the larger real estate companies, these are of little concern to agents who see themselves as creative, untethered professionals free to do to their jobs.

▪ Smaller fees: National real estate companies are able to offer larger compensation packages to agents — but also generally take a higher percentage of their commissions, while also charging them with desk and educational fees. (Broker/owners of national firm franchises must also pay royalty fees, marketing fees, technology fees, and renewal fees, just to maintain their franchises.) Very often, companies will also charge customers with transaction fees to cover their administrative and/or closing costs. I do not charge these same fees (and reject transaction fees on principle) because our company’s low overhead allows us to absorb those costs for our customers. (I cannot speak for all other independent firms, but I know that many also pass along these savings to their customers.)

▪ Local experience: For many buyers and sellers, organic and intrinsic local knowledge is a major deciding factor in choosing their representation. When you can demonstrate to a customer that your office originated from Miami, is built on the knowledge and experience of Miami professionals, and will proceed on decisions and intelligence based here in Miami, they naturally feel comfortable entrusting you with their Miami real estate.

▪ Personal touch: When shopping for clothes, I choose Bloomingdale’s or Macy’s for the everyday garments that get me through the week. But for those special occasions, I seek out boutique shops and custom clothiers when I want to look my very best. Real estate provides similar choices for customers, and independence allows offices like mine to tailor experiences that best suit (no puns intended) their tastes. Our low overhead and administrative freedom allow us to commit extra time, attention, and energy to the needs of each individual customer.

▪ The rising tide: In closing, I should mention that this upsurge in agency acquisitions and the introduction of new national companies into Miami are, in my opinion, very positive trends for our market and industry. They clearly demonstrate global interest in Miami real estate, and we are fortunate to have so many heavy hitters clamoring for agents and inventory. (As the saying goes, “a rising tide lifts all boats.”) Buyers and sellers are equally fortunate to have a wide range of agencies to choose from for their real estate needs. For me, the choice to stay independent, operate a business that reflects my values, and serve my agents and customers to the best of my abilities remains the wisest and best course of action.

Other recent articles from Master Brokers Forum include:

▪ Making the transition: Why we joined a national real estate company

▪ Miami real estate is driven by generosity

▪ Here are the 5 ‘hats’ real estate pros wear

▪ My 5 best tips for Miami condo buyers

▪ Rise of ‘casitas’ illustrates multigenerational housing trend in Miami

This story was originally published February 1, 2019 at 6:38 AM with the headline "Staying independent amid a flurry of Miami office acquisitions."