Elliman only made $100K in profits in Q1

Competitor Realogy Corp. reported uptick in sales $2.5M and up

TRD New York /
May.May 05, 2017 01:15 PM

UPDATED, May 6, 8:55 p.m.: No, that’s not a typo: Douglas Elliman’s profits dipped to just $100,000 during the first quarter of 2017, down from $7.1 million during the same period last year, parent company Vector Group reported Friday. The paltry sum was attributed to fewer closings at new development projects, Vector executives said.

Elliman closed sales worth $5.6 billion during the first quarter, compared to last year’s $5.7 billion, the company said. That resulted in $155.5 million in first-quarter revenue, down slightly from $157.6 million last year.

“There were less new development closings. That’s a higher-margin business so that hurt us,” said Douglas Elliman CEO Howard Lorber, during an earnings call Friday.

While the firm’s net income for the quarter was $100,000, its adjusted EBITDA (earnings before interest, tax, depreciation and amortization) was $1.8 million, compared to $9.1 million in 2016’s first quarter.

Overall, Vector’s first-quarter revenue was $415.2 million, up from $380.8 million in 2016’s first quarter. Vector reported a net loss of $4.2 million compared with net income of $19.3 million during the first quarter of last year.

Lorber told investors that New Valley, the real estate investment vehicle of Vector, would continue to take an “opportunistic” approach. “If there’s something that makes sense, that’s an opportunistic type of investment or a troubled project where we think we can add value, we’re interested,” he said.

In general, he said, the New York market has picked up — a sentiment shared by others in recent weeks.

Real estate conglomerate Realogy Holdings Corp., which reported its first-quarter results on Thursday, generated $1.2 billion in revenue for the quarter, a 6 percent improvement from the prior year, the company said. New Jersey-based Realogy had an adjusted net loss of $23 million compared to an adjusted loss of $17 million in 2016’s first quarter — both attributed to low seasonal transaction volume.

During an earnings call Thursday, Realogy CEO Richard Smith said there are “early signs of stabilization” in the luxury market, with sales in the $2.5 million-and-up segment up 10 percent from this time last year. “New product in New York City continues to be particularly strong,” he said.

NRT — the division that owns the Corcoran Group, Sotheby’s International Realty and Citi Habitats — saw revenue jump seven percent year-over-year to $897 million for the first quarter.

But Smith cautioned that there isn’t enough inventory on the low end of the market, and he described a recent bidding war for a $1 million New York City apartment as an example. Some 200 people showed up at the open house, 25 of them made bids and the apartment sold for 20 percent above the asking price, he said. “Listen, we don’t see that play out in every market,” he said. “The good news is, when something is priced right… it’s selling.”


Related Articles

arrow_forward_ios
John Giannone and Jac Credaroli (Credit: iStock)

Two Elliman agents launch platform to provide renters, buyers and sellers up to $50K in unsecured loans

Two Elliman agents launch platform to provide renters, buyers and sellers up to $50K in unsecured loans
Jacob Sudhoff and Scott Durkin (Credit: Sudhoff Companies, Emily Assiran, iStock)

Douglas Elliman is coming to Texas

Douglas Elliman is coming to Texas
Douglas Elliman chairman Howard Lorber (Credit: Getty Images and iStock)

Elliman’s revenue rose 18%, after sales frenzy to avoid New York’s new transfer tax

Elliman’s revenue rose 18%, after sales frenzy to avoid New York’s new transfer tax
(iStock)

Manhattan vacancy hits new peak; Brooklyn stable

Manhattan vacancy hits new peak; Brooklyn stable
Home sales plunged across South Florida in Q2

Home sales plunged across South Florida in Q2

Home sales plunged across South Florida in Q2
200 Water Street and 31 Prospect Park West (Google Maps)

Brooklyn’s luxury deal totals rise for 3rd straight week

Brooklyn’s luxury deal totals rise for 3rd straight week
Metro areas with less affordable housing drive high-income buyers to eye homes in lower-income neighborhoods at disproportionate rates (iStock)

TRD Insights: Gentrification happening fastest in least affordable cities

TRD Insights: Gentrification happening fastest in least affordable cities
Gov. Andrew Cuomo has given the go-ahead to reopen schools for in-person learning statewide (Getty; iStock)

School’s back on. Will the NYC resi market follow suit?

School’s back on. Will the NYC resi market follow suit?
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...