In a massive grab for market share reminiscent of the recent real estate boom, Halstead Property has gained five offices and a whopping 160 new agents by absorbing Connecticut real estate brokerage Country Living Associates.
Joining with the 17-year-old Country Living Associates, located in Fairfield County, in addition to the recent takeover of 55-agent Darien’s Wheeler Real Estate, brings Halstead’s total number of agents to more than 900 in three different states, and is part of a strategy of “smart growth” for Halstead, according to Diane Ramirez, the president of the company.
Ramirez did not disclose the details of the arrangement, saying only that Halstead absorbed the agents of Country Living and now has five new offices. The transaction was not a purchase, a Halstead spokesperson explained further, because no money changed hands, but would not elaborate, saying Halstead does not disclose financial details because it is a privately-held company.
“We just felt that the synergy with New York and Connecticut made a great deal of sense,” she said, noting that Halstead is one of the only major New York-based firms with offices in Fairfield County. “The fact that there were [only a few] other New York firms there was important to us.”
Sotheby’s International Realty has a presence in Fairfield County through a 2005 merger with William Pitt Real Estate, but the Corcoran Group and Prudential Douglas Elliman — Halstead’s biggest competitors in New York City — do not.
Country Living Associates, now known as Halstead Property Country Living, previously had seven offices in Fairfield County, but Halstead has closed the corporate headquarters in Norwalk and consolidated the company’s Darien office with nearby Wheeler. All of the Darien agents were encouraged to join Wheeler, said company co-founder Sharon Daley Maasdorp, who previously owned the company with colleague John DiCenzo, but now is Halstead’s executive director of sales for New Canaan.
Maasdorp said she thinks partnering with Halstead will give her agents an advantage by offering greater exposure to Manhattan clients looking to move to Connecticut.
“We just think that the whole idea of the Manhattan [flow] to Connecticut and vice versa just makes so much sense,” she said.
Moreover, the agents will now have access to the resources of privately-held Terra Holdings, Halstead’s parent company.
“Our agents are going to have such amazing tools as far as marketing goes,” Maasdorp said. “I think it’s a huge advantage over our competition.”
The move may very well give Country Living Associates a “shot in the arm,” said Jim Troy, the owner/broker of Stamford-based firm Independent Realtors. “It’s probably a good move.”
While the acquisition may be beneficial for Country Living, such an aggressive move into the troubled Connecticut market could be risky for Halstead, he said, estimating that prices in Fairfield County have fallen 15 to 20 percent since the peak of the market.
There are short sales, foreclosures and bank auctions even in the region’s poshest towns, like Greenwich, New Canaan and Darien, he said.
“The market’s extremely difficult right now,” Troy said. “The average real estate agent is really suffering.”
Troy, a longtime broker who opened his own company two years ago, said he has recently added loss mitigators and loan modification experts to his staff in order to help clients negotiate with banks or orchestrate short sales. Some of the region’s larger companies, he said, are unable to change their business models so quickly.
“What we’re seeing is that the traditional real estate companies are slow to react to a changing market,” he said. “Many of the larger companies are not adjusting fast enough, and we’re seeing them closing down their offices.”
Fairfield County is home to large national firms like Coldwell Banker and Weichert Realtors, along with regional firms like William Raveis Real Estate, which has offices in New York, Connecticut, Massachusetts and Rhode Island.
Troy said much of his business comes from the former clients of larger companies, whose homes are now in foreclosure after sitting on the market for a year or more.
“The market has changed so quickly,” he said, and as a result, many real estate agents “don’t know today’s business.”
He doesn’t foresee the market recovering for at least a year, despite the current seasonal uptick in activity. “We’ll have a pretty stagnant winter of 2009,” he said.
Other New York City brokerages have been closing offices that they opened during the boom. Corcoran, which gobbled up territory on the East End of Long Island in the mid-2000s by buying Cook Pony Farm and other local real estate companies, has closed four offices in the region since the beginning of 2009.
But Halstead’s Ramirez said she has faith that the Connecticut market will recover.
“Connecticut is an incredible community and place to live,” she said. “The fact that the marketplace is a little quiet is just a little blip.”
Question to readers: Is Halstead’s expansion strategy going to work in today’s market? Please comment below.