Coldwell NYC agents flee to Corcoran
May 30, 2009 12:00AM By Candace Taylor
Coldwell Banker Hunt Kennedy's agents will move to the Corcoran Group and other brokerages.
"Nearly all" of the current Coldwell Banker Hunt Kennedy agents are moving to Corcoran, said Philip Kiracofe, chief technologist at Coldwell Banker Previews International, CBHK's luxury home marketing arm, who is "overseeing the transition." Corcoran and CBHK share ties to New Jersey-based Realogy Corporation.
Though Kennedy, the COO of CBHK, did not respond to repeated requests for comment, a company source, who asked to remain anonymous, confirmed that Kennedy is moving to Corcoran, and said that other CBHK brokers are moving to Sotheby's International Realty.
The source also said all brokers have been told the four CBHK offices will be closed by June 5.
However, Corcoran CEO Pamela Liebman told The Real Deal last week that "there is no formal incorporation of Coldwell Banker agents into Corcoran."
Kiracofe said more details of the arrangement will be announced soon.
Confusion surrounding the situation is heightened by the companies' complicated ownership structure. NRT, the parent company of Corcoran and Sotheby's, is a subsidiary of Realogy, which also owns international real estate company Coldwell Banker. But Realogy, not NRT, operates independently owned Coldwell Banker franchises including CBHK.
Realogy declined to comment, but Kiracofe said the reason for the closure of CBHK was a desire by Realogy to save resources by "consolidating" the company into Corcoran and Sotheby's.
"This is very much not a scenario where [CBHK] couldn't hack it in the New York City real estate market," he said. "Realogy is looking at Manhattan and saying, 'do we need three successful brands, or can we consolidate?' It really made sense to integrate CBHK with the two NRT brands in New York City."
Kiracofe said the company will now be able to focus more of its resources on new innovations at its other companies.
Realogy has struggled amid the nationwide housing slump.
While the bulk of the agents are being encouraged to stay within Realogy, not all of them are being offered jobs within the company.
"The ones who are top producers are getting top priority," said a CBHK agent who spoke on the condition of anonymity. "Corcoran is choosing the top brokers from the company and will phase out the weak ones."
It's in Realogy's best interest to keep their best agents working for companies under its umbrella rather than lose them to the competition, said Kathy Braddock, a founding partner with real estate consultancy Braddock + Purcell and the New York brokerage Charles Rutenberg Realty, who said her company hired several former CBHK agents this week. Halstead Property's Diane Ramirez told Crain's that she, too, is interviewing CBHK agents.
"If I was Realogy, I'd want to keep as much business within my brands as possible," she said, adding that Corcoran and Sotheby's may "sweeten the pot" to retain best producers.
But some agents prefer not to stay within Realogy, the CBHK agent said.
"After this, would you want to stick with them?" the source said, adding that agents are frustrated because they've received little information about the company's fate.
"We don't know what's going to happen," the source said, adding that there is a good-bye party for agents next week at the company's 555 Madison Avenue office.
Listings and commissions
Kiracofe, who is overseeing the CBHK transition, said in situations where CBHK agents are moving to Corcoran or Sotheby's, the listings will automatically follow the exclusive broker.
"It's a very smooth transition," he said. "We're working closely with all the parties."
If a seller wants to list their home somewhere other than those two companies, he said, they would need to break the exclusive sales agreement.
But he said as an incentive for sellers to keep their listings within Realogy, Corcoran and Sotheby's are now "taking a serious look at" membership in the National Association of Realtors, a professional association with which CBHK is affiliated. Kiracofe is the president of the Manhattan Association of Realtors, which is the local chapter.
But agents, especially those who are not going to Corcoran or Sotheby's, are "very worried" about what will become of their listings and commissions, the unnamed CBHK agent said.
"If you stick with Joanne, you'll be fine and you'll get to keep your listings," the source said agents are being told. "If you don't, it's 'well, best of luck to you.'"
The fate of exclusive sales listings and commissions can be a source of confusion and disagreement when a company closes, said John Serpico, a real estate attorney at Brooklyn-based law firm Serpico, Serpico & Siddiqui. That's especially true since it's not yet clear whether CBHK will be sold, declare bankruptcy or become absorbed into another company.
If CBHK declares bankruptcy or ceases to exist, exclusive sales contracts with the company likely will automatically be terminated "because one party doesn't exist anymore," Serpico said.
It's slightly more complicated if CBHK keeps its name, but is sold or becomes a division of another company, he said.
In that case, CBHK technically could choose to enforce its exclusive sales agreements, since they are legally binding contracts, Serpico said, even if the original sales agents are no longer involved.
However, a sales firm almost always releases a seller from an exclusive agreement if the seller requests it, said Rutenberg's Braddock.
"Ninety-nine percent of the time, they release [the seller]," Braddock said. "You don't want that bad blood -- this is a business that is people-oriented."
When an agent leaves a firm, the seller is generally given the choice of staying with the brokerage, or following that agent to another firm, even if it means violating the terms of the exclusive agreement.
"It is a contract, but in many cases the company is not going to really enforce it, because it's bad for business," Serpico, the attorney, said. "I would think it would hurt their reputation if the word got out that they were trying to hold people to exclusives."
That said, a brokerage may sometimes fight to keep exclusives if they are for large sums of money, he added, saying that the ability to hold onto some exclusives is one incentive for Realogy or a new buyer to keep the CBHK brand name alive.
And exclusive sales and marketing contracts for new development projects may be more hotly contested.
"The real estate company is probably more inclined to keep [new development contracts] because they're bigger," he said.
For example, CBHK is the exclusive marketing and sales agent at 142-unit condo development Twenty9th Park Madison, on 29th Street between Madison Avenue and Park Avenue South. A spokesperson for the developer, Espais, said no decisions have been made yet about what will happen to the sales contract there.
Then there's the matter of commissions. Technically, all brokers should receive the commissions that they are owed from all the deals they have done in the past, and those from units that are currently in contract once they close, Serpico said. If these commissions are not paid, agents have the right to sue.
However, since commission checks are made out to the brokerage, the agent who did the deal does not always receive their payment right away. Firms may "house" money for a few days or weeks after a broker brings them a commission check, sometimes using it to pay bills or other expenses, explained Rutenberg's Braddock.
Payment delays are of particular concern when a brokerage is short on cash, Serpico said.
"I would be concerned about the [agents] getting their money when [the brokerage] is having financial difficulties," he said, adding that he would advise a broker client to ask that the money be kept in escrow rather than being cashed by CBHK.
As The Real Deal previously reported, CBHK is believed to owe somewhere in the neighborhood of $12 million to its creditors.
Serpico said the current economic climate may lead to more acrimony than usual between agents and their soon-to-be former employers.
"In this economic situation, there will probably be a lot more arguments because everyone's going to be fighting over that last nickel."
The Real Deal reserves the right to delete any comment it finds to be rude, obscene, racist, sexist, bigoted, irrelevant or repetitive, as well as inappropriate comments about anyone's personal appearance. The Real Deal does not endorse any comments posted on its Web site nor does it verify the veracity of comments or the identity of posters.
Comments
Anonymous
The CBHK agents are moving everywhere.
Comment #1 Posted By: Anonymous 05/30/09
Anonymous
That's right, CBHK agents! Realogy stabbed you in the back, so go to another Realogy firm so that they can stab you in the chest as well.
Comment #2 Posted By: Anonymous 05/30/09
Anonymous
Why is Pam denying all of this? So these people leave one company after having gotten screwed, and go to one in which the president outright lies about what's going on?? Hello? And, both are likely down the drain sooner than later? It must be to hang onto overpriced listings, but it would seem smarter to walk away and find a new start outside of Realogy, unless they're looking for more of the same.
Comment #3 Posted By: Anonymous 05/30/09
Anonymous
Coldwell Banker Hunt Kennedy is owned by Joanne Kennedy and Missy Michonski. Can't you get that into your head? They are a FRANCHISE - yes - like MCDONALD'S. Realogy doesn't own a single pencil of theirs. They are ceasing to exist. Corcoran and Sotheby's have nothing to do with Hunt Kennedy other than they are under the Realogy umbrella - Corcoran and Sotheby's NYC under NRT and that's about it. Why can't the REPORTERS get this straight. All Hunt Kennedy owes are fees to Realogy. As a gesture, I'm sure Corcoran and Sotheby's reached out to assist and that's that. Mr. COO you don't know what you're talking about and I cannot believe you are even quoted in this article. You work(ed) for Joanne and David and noone else - you are not an employee of Realogy. If you were, you would have never said the things that you did - and if you did, you would not have a job. Nice try.
Comment #4 Posted By: Anonymous 05/30/09
Anonymous
Does anyone know when the Coldwell Banker on 7th Ave. in Park Slope is set to close?
Comment #5 Posted By: Anonymous 05/30/09
Anonymous
All offices are to close by next Friday.
Comment #6 Posted By: Anonymous 05/30/09
Anonymous
Realogy is drowning in debt -- They are are literally inches away from declaring bankruptcy -- so when they sink, Corcoran will sink with them. The Titanic has already hit the iceberg, so to go to Corcoran is truly suicidal. However, there are 3 very reputable debt-free firms in Manhattan, so the smarter CBHK brokers are signing up with those firms. Think twice before putting your precious career in the hands of Pam Liebman & Corcoran's thoroughly incompetent management team.
Comment #7 Posted By: Anonymous 05/30/09
Anonymous
And what are those debt free firms?
Comment #8 Posted By: Anonymous 05/30/09
Anonymous
Brown Harris Stevens, Halstead, Elliman
Comment #9 Posted By: Anonymous 05/30/09
Anonymous
Hmmm, how can you be sure? Are they the only debt free firms? What about Kent Swig and all of his reported financial troubles. Do those troubles play any role in his relationship with Terra Holdings?
Comment #10 Posted By: Anonymous 05/30/09
Anonymous
Terra Holdings is in no way related to Kent Swig's construction projects. Do your research!
Comment #11 Posted By: Anonymous 05/30/09
Anonymous
Years ago I interviewed at Corcoran, as I was impressed by their "hype". While the manager interviewing me seemed pleasant enough, I detected her rather slim knowledge of real estate, but I was naive enough to think it didn't really matter. Once I joined, the nightmare started: At weekly sales meetings, she spoke to us as though we were a bunch of unruly kindergarteners. And while I was experienced enough not to need her "help" she continually interferred with my deals, often doing damage. When she realized I didn't appreciate her "help" she became hostile, so I left Corcoran and she became vindictive. My new firm (yes, one of the debt free-ones) was kind enough to tell me she called them to trash me (they knew not to take her seriously). Well, that was 12 years ago, but she's still running one of Corcoran's most prominent offices. Go figure...
Comment #12 Posted By: Anonymous 05/30/09
Anonymous
Question I Hope to get input from.. I am currently a residential agent that does both rentals and sales. I have been doing this for 3 years now and do OK (not a huge earner, but probably above average) I interviewed with Ruttenberg, City Connections Realty and Citi Habitats. Do any of you have any input/opinion about joining these firms? Thanks S
Comment #13 Posted By: Anonymous 05/30/09
Anonymous
What about the Halstead effort to get the CBHK brokers. Did they get many?
Comment #14 Posted By: Anonymous 05/30/09
Anonymous
I'm a CBHKer. I have closings coming up. We are supposed to deliver the check to JK. We've been promised we'd get our commissions. Can we actually lose them? Should I not believe her?
Comment #15 Posted By: Anonymous 05/30/09
Anonymous
Halstead seems pretty clueless, but if they aren't going under, they seem as acceptable as any other place- unless the splits are 50-50. The people that I've seen quoted there know nothing, so giving them half for nothing doesn't make sense. Isn't there a good independent firm in NYC that understands real estate, and pays their agents a good split?
Comment #16 Posted By: Anonymous 05/30/09
Anonymous
Pot into the frying pan, guys and gals... BHS is in so much trouble, they don't know what to do at this point. Corcoran is run by the new Leona Helmsley. Prudential by a hot-dog schmuck and Carole Channing. Screw the brands, go as independent as you can and rely on your own abilities to do deals...the brands are useless anymore.
Comment #17 Posted By: Anonymous 05/30/09
Anonymous
Why would anyone go to Corcoran to be chiseled big time?
Comment #18 Posted By: Anonymous 05/30/09
Anonymous
I'd like to know how the writer of this article got all of this information when none of it was available publicly.
Comment #19 Posted By: Anonymous 05/31/09
Anonymous
As soon as something happens in this industry people call and email the Real Deal hoping to get the news out and this website and the magazine do a great job of representing that voice.
Comment #20 Posted By: Anonymous 05/31/09
Anonymous
Moving from one big over leveraged firm to another will get you nowhere. You will be forced to pay FEES just to transfer your license. Join Nest Seekers. NO FEES, No egos, your phone will be ringing 3-5 times a day with new leads and you will have unlimited advertising. With the best technology in the industry. Stop following from one oversized company to the other. That concept doesnt work anymore. who wants to be an agent in a company that has 700 agents. Nobody cares about you and its about your fees and what you can do for the company rather than what they can do for you. Join Nest Seekers.
Comment #21 Posted By: Anonymous 05/31/09
Anonymous
As far as NYC is concerned, it just lost another company and another 213 jobs. This is very sad.
Comment #22 Posted By: Anonymous 05/31/09
RealtorFor25Yrs
Guess all you "youngsters" weren't around when the same thing happened in the late 1980's/early 1990's. BTW, clients do business with Agents they like and trust, your company has very little do do with it. Market yourself and what you can do for your clients!
Comment #23 Posted By: RealtorFor25Yrs 05/31/09
Anonymous
I agree with #29. Corcoran is a wash up of a business. There is nothing that they can possibly do for you at this point.
Comment #24 Posted By: Anonymous 05/31/09
Anonymous
#21: FYI, 2008 was Halstead's 2nd best year ever .Halstead just opened new offices in Brooklyn, Riverdale, New Jersey & Connecticut (and Halstead is still open in Harlem, while 3 major firms just closed their Harlem offices). Halstead is debt-free & successful, and they don't gauge their brokers for extravagant fees that Corcoran & Sotheby's charge their brokers. So....clueless? All Manhattan firms should all be as "clueless" as Halstead is.
Comment #25 Posted By: Anonymous 05/31/09
Anonymous
You can't have a successful firm that is not run by someone who is not in some form an agent themselves. To manage agents, you need to understand agents, you need to be one.
Comment #26 Posted By: Anonymous 05/31/09
Doug
Re the above: #4 is correct that a franchisee outlet has independent ownership that’s not the franchisor, and #29 is correct that a client generally chooses a R.E. agent because of that agent (vs. the agency). I’ll also add that really good agents are likely to succeed at any agency, and that there are probably agents who don’t succeed regardless of the agency they’re with. However, it still remains that none of these points mean that the agency is irrelevant to the agent, or – more on point – that the franchisor is irrelevant to the success of either the agent or the franchisee agency. Different R.E. franchisors provide different levels of training and other support, for example. And on the money side, different franchisors have different models regarding agent income – which isn’t BTW just limited to splits. Lastly, I agree with #32, and believe that agents are, on the whole, much more likely to succeed if those in company management – franchisor and brokerage management alike – have had personal experience as R.E. agents and are capable & willing to truly focus on the success of the agents on the front lines.
Comment #27 Posted By: Doug 05/31/09
Anonymous
oops I did again, played with you heart...
Comment #28 Posted By: Anonymous 06/01/09
Anonymous
There you go. Pam L. had no comment but JK and a number of her agents are on the way to Corcoran. NRT feels the pressure from Realogy (they are in big financial trouble) and they need to keep profits up to help out the parent company. Adding more agent in a market that showed sales transactions down 50%+ 09-08 will only create greater strain...good luck!
Comment #29 Posted By: Anonymous 06/01/09
Anonymous
This is highly reminicent of the axis powers that went down after the second world war. Come help the fatherland?
Comment #30 Posted By: Anonymous 06/01/09
Anonymous
To #13. "S" Go with Ruthenberg, they are the best of them. But remember, they should work for you, if they don't, dump 'em! Good luck
Comment #31 Posted By: Anonymous 06/01/09
Anonymous
bravo #26, dead on
Comment #32 Posted By: Anonymous 06/01/09
Anonymous
Go to Rutenberg 100% commission no one gets down your back you can work from home. The reason why all these 50% commission company get down your back is because they need you to close to close and to close deals. when you pay for your seat in a company the company does not interfere with your work. It becomes your business more then the brokers business. Yes cold well is part of reology and so is century 21 ny metro and corcoran and well corcoran own citi habitats so go figure.
Comment #33 Posted By: Anonymous 06/01/09
Anonymous
Halstead is debt-free and would be my #1 choice!
Comment #34 Posted By: Anonymous 06/01/09
Anonymous
all brokers are losers...they should get real jobs!!!!!!!!!!!!
Comment #35 Posted By: Anonymous 06/01/09
Anonymous
if only they were qualified for real jobs.
Comment #36 Posted By: Anonymous 06/01/09
Anonymous
To think that Halstead(or BHS) or Elliman are debt free is to be about as clueless as you may have been to think the market was never going to go down. The owners of BHS & Halstead (Burris, z-brothers, and buckethead Swig) don't even talk to each other anymore-Swig was literally shown the door our of 770 Lex. And if you think Swig's condo collapses don't have an impact on how the rest of Terra Holdings is run, I have a mighty fine bridge over the Gowanus I'd like to sell you.
Comment #37 Posted By: Anonymous 06/01/09
Anonymous
As a former CBHK agent, I have to say that everyone on the management side has been helpful in the transition -- regardless of where we are going -- and JK in particular has been extremely gracious and dignified in the face of crisis. While its obviously is a time of anxiety for all concerned; its disappointing to read some of the sniping and back-biting comments posted here.
Comment #38 Posted By: Anonymous 06/01/09
Anonymous
Coldwell Banker Hunt Kennedy Previews International is Independently Owned & Operated, Great Company, Tuff Times, Peace Out!
Comment #39 Posted By: Anonymous 06/01/09
Anonymous
Corcoran just can"t seem to stay out of the news these days. is it me or do they just have to go away already! Can we spend more time talking about real estate and less time discussing this obviously dull boring and soon to be defunct business.
Comment #40 Posted By: Anonymous 06/01/09
Anonymous
To NYC real estate brokers: GET AN MLS up and running. You won't need ANY of these companies- you can function with full information, once you eliminate those making an ongoing effort to squelch it. Get rid of REBNY; get a true MLS for your listings, and go make money without giving half of it away to these morons. No one can accomplish this, but the real estate agents TRAPPED into working for IDIOTS.
Comment #41 Posted By: Anonymous 06/03/09
Anonymous
for all those out there that continually knock REBNY, the RLS, OLR, and all the other listings databases the "majority" of brokerages subscribe to in Manhattan.... what do you really think the benefits are to a "Realtor" "MLS" are over what is already in place? All you seem to cite is ethics... both have a great code of ethics which are followed and enforced. Also, both offer sharing of listings between firms, so that all brokers have access to each others listings.
Comment #42 Posted By: Anonymous 06/05/09
Anonymous
The only difference I see between the two is the IDX feed that allows one brokerage to have another brokerages listings on their own website.
Comment #43 Posted By: Anonymous 06/05/09
Anonymous
great for small firms, with none of their own listings. I'm sure Ruttenburg will love this seeing as they barely have any of their own listings... no surprise once you meet some of their brokers!
Comment #44 Posted By: Anonymous 06/05/09
Anonymous
Rottenberg... Our brokers have one thing in common... they are the worst in the industry!
Comment #45 Posted By: Anonymous 06/05/09
Anonymous
well again Corcoran is in the NEWS. the company is dead!! I know many of the brokers there and they are loosing exclusives left and right. deal are not closing and Corcoran Sunshine is over as the new development market is over. Corcoran is nothing without the new development and Pam L. never cared about her resale brokers. now she needs them but every one wants her to go away!!!! Stay away from Corcoran as it is the biggest "Ponzi scheme", they will use your money to pay your self and then kick you out.
Comment #46 Posted By: Anonymous 06/13/09
Anonymous
Well the push is on. So let's see many agents from the defunct CBHK are attempting to move to Corcoran, Sothebys and Halstead. In this market when sale transaction are down by 50% year over year these other companies will take on more cost and try to find space more agents that many will be producing at 50% less then a year and half ago. I say look for more trouble with these mega firms.
Comment #47 Posted By: Anonymous 06/24/09
Anonymous
As a former CBHK agent I have found that boutique agencies are the way to go. These corporate voids do not give a crap about you. You are a number, they only want your money and if they could get it, your soul.
Comment #48 Posted By: Anonymous 06/27/09