As competition intensifies, real estate brokerages continue to consolidate.
This week, Dallas-based United Real Estate acquired Fort Lauderdale-based Charles Rutenberg Realty, scooping up 1,000 agents through the deal.
The purchase is part of United Real Estate’s strategy to expand from its current total of 8,000 agents worldwide — 2,000 in company-owned brokerages and 6,000 in franchises — to 20,000 by late 2020.
The Charles Rutenberg firm stood out for its performance. said Rick Haase, president of United Real Estate. “South Florida is not the focus. It’s a focus on best-in-class operations, wherever you find them. South Florida is always a great market with population density increasing.”
Key factors included leadership, sales-force retention, and broker expertise, he said.
For the Broward firm, United’s technological tools were especially attractive, said Cynthia Benchick, said co-owner and managing partner of Charles Rutenberg. The deal gives the Rutenberg agency a stronger position in online advertising, website presentation, and search-engine optimization.
“It was a good time to join a nationwide company with many resources. We have strong competition here,” said Benchick.
In exchange for providing technology, United will get a flat transaction fee from each commission, said Haase.
The terms of the deal were not disclosed, but Haase said the fee is far less than the traditional commission 50-50 split. “You have to run efficient models as well as the right scale. We need to scale appropriately to keep providing these tools,” he said.
Haase said United is looking to acquire other local real estate firms.
The transaction won’t mean much for consumers. But the agents themselves are key.
“The value proposition has to be for the agents,” said Steven Reibel, senior vice president of Keyes Realty. “The hard part now comes with the agents feeling like they’re being taken care of and they’re not being left behind.”