Longstanding New York City brokerage Coldwell Banker Hunt Kennedy is closing its doors, according to multiple sources familiar with the company.
The 21-year-old, 214-agent company — Manhattan’s sixth largest, according to a recent survey by The Real Deal — will cease operations within 60 days, the sources said.
What’s left of the company is believed to be on the auction block and
priced at around $5 million. But because Coldwell Banker Hunt Kennedy
– including its luxury marketing division Coldwell Banker Previews
International — allegedly owes some $12 million, the price would
presumably go towards its debt.
It’s not the first Manhattan company to close its doors in a rocky market. Last month, boutique residential real estate brokerage JC DeNiro & Associates announced it would close its doors.
But Coldwell Banker Hunt Kennedy is by far the largest Manhattan company to close thus far, with offices at 555 Madison Avenue, 329 Columbus Avenue, 64 West 21st Street, and 155 Seventh Avenue in Park Slope.
JoAnne Kennedy, the firm’s COO, did not respond to requests for comment, but sources said she will be relocated within Realogy.
In a company-wide memo distributed today and obtained by The Real Deal, Kennedy told brokers: “As the economy continues to stammer and hopefully settle down, as our industry is shifting, we have a plan for all of us to move together to continue our careers.”
She continued: “If you ‘follow me,’ all of your listings will go with you, as well as your data. You will have an opportunity to interview before making a final decision.”
In response to rumors that brokers would not receive their commissions, she said: “everyone will be paid every cent they are due. The money belongs to you.”
Known originally as Hunt Kennedy, it was founded in 1988 by William
Morris Hunt III and Kennedy, the current COO, and specialized in high-end
properties on the Upper East and West sides.
In February 1996,
Hunt Kennedy joined forces with David Michonski and international real
estate company Coldwell Banker, which has some 3,500 offices worldwide,
to create a New York-based, wholly owned franchised affiliate known as
Coldwell Banker Hunt Kennedy.
Coldwell Banker Hunt Kennedy’s parent company is Parsippany, N.J.-based Realogy Corporation, which has struggled amidst the nationwide housing downturn. Realogy also owns NRT, the nation’s largest residential real estate company, with brands such as the Corcoran Group and Sotheby’s International Realty under its umbrella.
Real estate firms generally do not fetch high prices because they have few assets, said Paul Purcell, head of Charles Rutenberg Realty in New York and a partner at real estate consultancy Braddock + Purcell.
“You’re buying a name and people, but you’re not buying assets,” Purcell said.
The firm likely struggled in a market with “very little deal volume,” Purcell said, and because the Coldwell Banker name carries little weight in Manhattan, he said.
Just last month, Kennedy told The Real Deal that many New Yorkers “associate the Coldwell Banker logo with the suburbs.” At the time, she said the company’s high-end Coldwell Banker Previews International arm was helping the brand gain traction in New York City.
It appears to have been too little, too late.
“I hate seeing it happen,” Purcell said of the company’s closure. “It doesn’t bode well for any of us.”