Can virtual brokerage eXp make NYC a reality?

Wash.-based firm has 18K agents, twice as many as last year. But New York will be its toughest test.

New York /
May.May 16, 2019 04:00 PM
eXp Realty CEO Glenn Sanford (Credit: iStock)

eXp Realty CEO Glenn Sanford (Credit: iStock)

There’s the dream of making it in New York as a residential firm: the sky-high commissions, the near-celebrity status and elevated lifestyle. And then there’s the reality: most firms fail here, and fail hard.

But that isn’t stopping eXp Realty, a virtual brokerage that is one of the industry’s fastest-growing firms, from giving it a shot.

The Bellingham, Wash.-based company plans to launch in New York City in June, the company confirmed. On April 16 and 17 at the Park Lane Hotel, it held two pre-launch infosessions titled “eXp Realty: NYC Rising.”

“It would be kind of silly not to be here,” said Kim Canavan, a Keller Williams alum who is eXp’s designated managing broker for New York State. exP also hired Corcoran Group alum Matt Parrella to head up its operations in New York City.

The firm, founded in 2009 by CEO Glenn Sanford, now has nearly 18,000 agents nationwide, up a whopping 94 percent year-over-year. Its growth comes at a time when traditional firms are struggling with profitability and agent retention. The cloud-based eXp — which does not operate any brick-and-mortar locations — has been offering agents high commission splits, revenue-sharing and stock options.

Among those joining its ranks were several top-producing agents, including many from Keller Williams, such as David Devoe, an agent in Hoboken who moved 32 agents and 10 staffers to eXp earlier this year.

For New York licensing purposes, Canavan said eXp will have three designated branches — located in Regus offices — in Midtown, the Financial District and Downtown Brooklyn. Canavan and Parrella declined to say how many agents they are looking to bring on. “We want it to be sustainable and to bring on quality people,” Parrella said.

Few national brands have been able to successfully infiltrate New York. Five years after launching a Manhattan office and hiring senior Douglas Elliman executives to run it, William Raveis does not have significant market share, and Christie’s International Real Estate has also struggled to attract top agents. Keller Williams NYC has weathered the loss of agents and a leadership shakeup in the past year.

Although eXp’s agent headcount has exploded over the past two years, it’s unclear how much market share it commands in each city.

According to a report from the research firm Real Trends, firms like Coldwell Banker, Sotheby’s, Keller Williams and Compass still control many large metro markets like Los Angeles and South Florida. In New York City, Elliman and Corcoran are the giants; the firms closed $28.1 billion and $19.3 billion in 2018 sales respectively, Real Trends found.

But compared to traditional rivals — which have been reporting losses — eXp’s recent financial results have been heartening. It generated $14.5 million in gross profits during the first quarter of 2019 — up 132 percent year-over-year. Revenue rose 153 percent to $157 million, with a net loss of $6.3 million (down from $10.7 million).


Related Articles

arrow_forward_ios
Wells Fargo CEO Charles Scharf (Getty Images)
Wells Fargo backing off mortgage market
Wells Fargo backing off mortgage market
One Brooklyn Bridge Park units 427/8 and 1115 (StreetEasy, Google maps)
One Brooklyn Bridge Park condos top Brooklyn luxury market
One Brooklyn Bridge Park condos top Brooklyn luxury market
The Ritz-Carlton New York NoMad (The Ritz-Carlton New York, Illustration by Priyanka Modi for The Real Deal with Getty)
Ritz-Carlton NoMad evades short-term rental ban
Ritz-Carlton NoMad evades short-term rental ban
95 Charles Street (Illustration by Kevin Cifuentes for The Real Deal with Getty, Streeteasy)
Manhattan luxe sees 28 contracts signed in first half of August
Manhattan luxe sees 28 contracts signed in first half of August
740 Park Avenue and Corcoran broker Francine Crocker (Corcoran, Getty)
Tower of power: Duplex at 740 Park listed for $26M
Tower of power: Duplex at 740 Park listed for $26M
Douglas Elliman’s Kirsten Jordan and 2728 Thomson Avenue in Queens (Corcoran, Douglas Elliman, Getty)
TRD Pro: Queens’ priciest home sales in the second quarter
TRD Pro: Queens’ priciest home sales in the second quarter
Seattle Seahawks receiver and newly-licensed realtor Tyler Lockett along with 812 245th Place Northeast in Sammamish, Washington (Photo Illustration by Steven Dilakian for The Real Deal with Getty Images and Redfin)
NFL star earns his real estate wings
NFL star earns his real estate wings
Toll Brothers' Douglas Yearly and property at Sparks, Nevada (Toll Brothers)
“Honey, I bought the town:” Buyer ends up with big chunk of subdivision
“Honey, I bought the town:” Buyer ends up with big chunk of subdivision
arrow_forward_ios

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

Loading...