Call it a declaration of war?
StreetEasy has threatened to yank Douglas Elliman’s rental listings in what the portal has described as a contract dispute.
The Zillow-owned company alerted Elliman’s nearly 2,500 New York City agents on Thursday that the brokerage’s rental listings would be pulled unless the dispute is resolved by June 19. StreetEasy also sent the email to landlords represented by Elliman agents.
“Douglas Elliman agents will also no longer be able to create or publish new rental listings” on StreetEasy, Zillow, Trulia, Hotpads and Naked Apartments, according to the email, a copy of which was viewed by The Real Deal. Sales listings will not be affected, though it wasn’t clear why.
Neither company would confirm what sparked the email.
In a statement Thursday, a StreetEasy spokesperson said the company is committed to “ongoing conversations” with Elliman and wishes for a “swift resolution.”
“To be clear, this is not our preferred outcome,” the spokesperson said. “We know that StreetEasy is a valuable marketing tool for agents and a trusted resource for consumers.”
A spokesperson for Elliman declined to comment. But in an email to agents later on Thursday, the firm called StreetEasy’s threat “heavy handed” and said it was continuing to negotiate “some aspects of our relationship.”
The public clash marks a major turn in the relationship between the two companies. Ellliman largely stayed out of a brawl that erupted between StreetEasy and the city’s top firms in 2017, when the portal launched Premier Agent, its controversial agent advertising program. Instead, that year Elliman hired StreetEasy to build a back-end listing system for agents. At the time, Elliman COO Scott Durkin said of the portal: “No one can deliver listings to agents and customers like StreetEasy.”
But the system, which was supposed to debut in 2018, never materialized. Neither side would say publicly what happened. By late last year, Elliman joined other residential firms in blasting StreetEasy when the portal stopped taking listing feeds from brokerages. Although Zillow claimed that feeds were a “barrier to innovation,” brokers alleged manual entry was a form of blackmail that was time-consuming and would increase errors.
In an email to agents late last year, Elliman said it was “assessing the return on its StreetEasy investment” and exploring alternative marketing options. “We will not go backwards in our ability to quickly and accurately utilize technology to market and sell properties,” the firm said.
With 24 offices in New York City, Elliman churns out a heavy volume of rentals and sales. The firm sold $7.96 billion worth of real estate in 2019, according to TRD’s most recent ranking of top firms.
Some of its competitors, including Compass, Brown Harris Stevens and Warburg Realty, cut their direct feeds to StreetEasy in 2017 in favor of the Real Estate Board of New York’s syndicated residential listings service (RLS), which StreetEasy refused to accept.
The listing feed issue is just one point of contention among rental brokers, however. StreetEasy has steadily increased the fee to post listings, which now costs $6 per day per listing.
In New York City, agents have not been allowed to conduct in-person showings since March, when Gov. Andrew Cuomo ordered non-essential workers to stay home.
Elliman had a net loss of $69 million during the first quarter, having lost $10.4 million in the same period last year, its parent company Vector reported. Quarterly revenues were $165.5 million, up 2.3 percent.
During an earnings call, Elliman chairman Howard Lorber said the firm is bracing for a “severe decline” in sales activity.
The firm laid off 100 employees and already cut salaries by 15 percent. It plans to consolidate offices or negotiate “rent reductions, deferrals or holidays.”