Real Estate Brokerages

searcher profile

July 17, 2022

by a searcher from University of Pennsylvania - The Wharton School in Los Angeles, CA, USA

Has anyone looked at or (better yet) analyzed acquisition of a Real Estate Brokerage?

I recently got approached by 3 partners who are aging and looking to transition out of a very successful local brokerage. Question is: how to approach the transition stage and generating value once the owners scale back their work.

I'm trying to determine how best to value the business and how growth would occur given the "kill what you eat" nature of brokerages. If you've looked at this space, I'd welcome a short chat. Thanks!

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commentor profile
Reply by a searcher
from Northwestern University in Chicago, IL, USA
I used to work in commercial real estate brokerage and know that space fairly well. The biggest challenge with brokerages (at least on the commercial side...I won't speak for residential) is the retention of the people (and the relationships/name recognition tied to those people). It's probably likely that 20% of the brokers at the firm do 80% of the business, and any sale would need to be contingent upon those 20%ers staying with the firm. Just some food for thought.
commentor profile
Reply by a searcher
from University of Pennsylvania in Los Angeles, CA, USA
Appreciate the inputs, Troy. If you have a few moments, would welcome a short chat. If so, DM me or I also connected on LI. Thanks!
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