William B. May changes to 100 percent commission model


By Jovana Rizzo | February 28, 2009 04:34PM

Brokerage William B. May has changed its business model so brokers can receive 100 percent of their commissions. Charles Rutenberg Realty adopted a similar model in 2006, as reported by The Real Deal, in which brokers pay fees to the brokerage, but don’t have to give up any of their commission. At William B. May, brokers will be required to pay a one-time $1,500 fee, and $500 per month, according to managing partner Craig Lamb. The brokers don’t have to pay a fee per transaction, which sets this system apart from Charles Rutenberg Realty’s commission model.

The brokers will be able to use the William B. May name on Web sites and stationery. They will also have a William B. May e-mail address, voicemail and use of the firm’s marketing materials. But other than that, the brokers are free agents. They have their own clients, listings and commissions, and are not under pressure to make sales, Lamb said.

Lamb said he has been working on implementing this model for about two and a half years, and it comes just in time, as brokers are making fewer deals because of the recession.

“I don’t really think brokers can afford to have the type of [commission] splits with the major houses anymore,” Lamb said, adding that at most brokerages, brokers have to give up 25 to 50 percent of their commissions. “There is pressure on the marketplace in terms of people wanting to pay reduced commissions, and fewer people wanting to use brokers. And in this [economic] environment, it’s very hard to justify giving [a chunk of your commission] up,” he said.