In an effort to become a one-stop shop for real estate clients, Lee & Associates NYC is getting into the residential business.
As many residential firms face financial strain, the Midtown-based brokerage Lee & Associates is betting on its new division to be a natural extension of its core commercial business. Because the company is part of a national brand, it can afford to tackle “the missing puzzle piece” in the firm’s real estate offerings, said Adam Frisch, managing principal of Lee & Associates NYC Residential.
“It’s now a company that can service any possible real estate need a client has,” Frisch said.
Frisch will run the division with Mitchell Glixon, the division’s chief operating officer. So far, the team is small: It has five agents and expects to have 12 to 15 by year end, Glixon said. He expects that to grow to 20 to 25 brokers at the end of the second year, but if “business outgrows that, there’s room for that.” There are currently no plans to expand outside New York City.
Lee & Associates was founded in California in 1979 and launched in Manhattan in 2011, with an emphasis on retail leasing. A recent TRD ranking of the top retail leasing firms found that Lee & Associates was No. 10 in the city, with about 230,000 square feet leased over a one-year period. The firm currently has 40 agents in New York City, according to the Department of State.
The move comes at a time when shrinking income and climbing costs have weighed on traditional residential brokerages. Companies have spent money attracting and retaining brokers — as well as investing in new technology. While cognizant of those challenges, Frisch sees it as more of a spending problem than a fundamental shift. As the new kid on the block, the company may have to shell out money to attract brokers — but he’s seeking to spend less after getting through the initial stages.
Lee & Associates’ residential division can leverage the company’s experience and inventory in residential leasing, Glixon said. The team isn’t aggressively recruiting to poach agents from firms like Compass, he added. But Frisch and Glixon are willing to spend money on specific brokers they’re interested in. That includes signing bonuses as well as “comparable” commission splits for those with large, sustainable books of business.
“We’re not looking to overload ourselves,” Glixon said.