As consolidation reshapes residential real estate, smaller firms in New York are touting new opportunities — and betting their survival on the rising tide of giants helping them stand out.
Earlier this week, Corcoran president and CEO Pam Liebman and Brown Harris Stevens CEO Bess Freedman traded jabs on stage at The Real Deal’s New York Forum over the industry’s future after Compass’ recent acquisition of Corcoran’s parent company, Anywhere Real Estate.
During their conversation, Freedman repeatedly needled Liebman over Corcoran’s place within the Compass empire, warning that the deal would create “sameness” across brands. She also took aim at Compass’ campaign to expand private listings within its ecosystem.
“If you want to work at Brown Harris Stevens, we believe in marketing your properties to everybody,” Freedman said. “She should encourage Compass, Rob [Reffkin], to make sure that they take down the wall for the private listings network and share those listings with everybody.”
Freedman’s criticisms echo a broader concern among smaller independent firms in the city, which are now fighting for their place in the industry as a handful of national players threaten to dominate it. The challenge in holding their own against the giants is also exacerbated by the growing popularity of private exclusives, which could squeeze many of the little firms out of the listings business.
Some of these smaller shops have taken themselves out of the independent game entirely, opting to sell to a heavyweight outside of the Compass network, such as Howard Hanna’s recent acquisition of Elegran Real Estate, while others, like BHS, are marketing themselves as alternatives to the corporate behemoths.
“Sometimes when it gets too big — and that works for some people — but agents can get lost in the sauce,” Freedman said. “You want to be able to talk to your manager or see what’s happening and talk to your colleagues.”
Leslie J. Garfield, which specializes in townhouse deals, has expanded outside of its expertise niche with its recent acquisition of a boutique new development marketing firm, Cantor Pecorella. The firm, now under the Garfield umbrella, will head sales at 227 West 19th Street, an eight-unit luxury development which includes a four-bedroom townhouse, when they launch this summer.
“Consolidation creates a vacuum, and that vacuum is exactly where we’re operating,” said Garfield’s managing partner, Jed Garfield. “When firms get bigger, the client experience can get thinner. We’ve built 50 years of business on the opposite model.”
Other brokerages have attached themselves to bigger names with wider nets to stand out. Last month, Platinum Properties announced it was joining the Forbes Global Properties Network as its only New York outpost, taking the spot vacated by Elegran. The firm then rebranded as Platinum Forbes Global Properties.
“One of, if not our biggest, strengths has been the fact that we’re small and nimble, and I just don’t think it’s possible to be that way when you’re a massive firm,” the brokerage’s CEO and co-founder, Dezireh Eyn, told TRD in April. “We pivot on a dime because we can do that.”
In case you missed it…
New York Gov. Kathy Hochul finally released her proposed $268 million budget for the state, including a pied-à-terre tax, which has raised eyebrows — and serious concerns — across the industry. The proposed tax would be an annual levy on second homes in the city valued at $5 million or more.
Though Hochul’s office projects the tax will bring in $500 million in revenue, others expect that estimate to be much lower. An analysis by the city’s comptroller shows the revenue from the tax is more likely to fall between $340 million and $380 million.
NYC Deal of the Week
The priciest deal to hit the city rolls this week was for a penthouse at Madison Realty Capital’s 16 Fifth Avenue, which sold to an anonymous buyer for $32.5 million. The deal closed for a significant discount from its last asking price of $45 million before it entered contract last month.
Unit PH2 is a duplex spanning 6,800 square feet. It also has five bedrooms, seven bathrooms, an elevator and two terraces.
Corcoran’s Tara King-Brown and Ryan Kaplan are heading sales at the project.
Read more
“No one’s telling me what to do”: Pam Liebman clashes with Bess Freedman at TRD Forum
Howard Hanna acquires Elegran Real Estate
Platinum Properties joins Forbes Global Properties network
