The auction house and residential real estate services company will take a joint 80 percent ownership stake in Concierge, a luxury real estate auction marketplace, they announced Thursday. Financial terms were not disclosed.
Concierge Auctions co-founders Chad Roffers and Laura Brady will remain president and CEO, respectively. But they will report to a newly formed board of managers made up of Sotheby’s and Realogy executives and chaired by Philip White, CEO and president of Sotheby’s International Realty, a Realogy brand.
Concierge Auctions, founded in 2008, sells homes, aiming to match its network of independent luxury agents with high-net-worth clients.
In 2020, Concierge reported processing more than $3.4 billion in competitive bids with an average home sell price of $3.5 million. This year, the company broke its fourth world record for highest price of a single-family home ever sold at auction with the sale of palatial Beverly Hills estate Villa Firenze, which was listed at $160 million.
Concierge has had its share of controversy, however. Between 2014 and 2019, the company has been a defendant in 10 lawsuits, half of which accused Concierge of using some type of fake bidder to increase the price of homes or to make sellers think there was more interest in their properties than there really was.
Concierge denied all the lawsuits’ allegations, saying many were dismissed and that four of the suits led to payments to Concierge.
Luxury home auctions have increased in popularity, especially during the pandemic as second-home purchases continued to trend up and traditional home shopping morphed in a number of ways.
The auctioning of residential real estate has grown particularly at the high end, where the buyer pool is narrower and properties can be harder to value and sell.
Meanwhile, brokerages have had a run of robust earnings, leaving them with lots of cash and appreciated stock for acquisitions.