UPDATED August 24, 5:25 p.m.:
Mark McLaughlin’s future at Pacific Union International appears to be set following news that Compass will acquire his company, but it also looks to be more limited than many had expected.
At a meeting on Thursday in San Francisco, Compass CEO Robert Reffkin told a group of agents that McLaughlin, Pacific Union’s CEO, “will only oversee Pacific Union agents.” Compass agent Lisa Sockolov, a former Pacific Union broker who attended the meeting, provided The Real Deal with that account.
On Friday, a Compass spokesperson confirmed that McLaughlin would report to Peter Jonas, Compass’ current West Coast regional president. McLaughlin’s new role will start when the acquisition closes.
“Given my commitment to the Pacific Union real estate professionals and employees, I am overseeing only Pacific Union offices,” McLaughlin said in a statement.
McLaughlin, who built Pacific Union into a West Coast behemoth with 1,700 employees and $14.1 billion in sales volume last year, had been a likely choice to run a combined California operation.
Instead, his role will be smaller. An organizational chart shows Jonas overseeing McLaughlin and on the same level, a series of general managers and compliance managers. Jonas joined Compass from Uber, where he spent a year and launched Uber Real Estate. Before that he worked at Facebook for seven years, on games and mobile apps.
On Wednesday, McLaughlin threw a midday cocktail party with agents and managers in Beverly Hills following the previous day’s news of Compass acquiring his firm, according to Inman. McLaughlin did not attend the San Francisco meeting on Thursday, where Reffkin addressed about 100 agents and managers from both companies, Sockolov said. She is now part of Compass star agent Sally Forster Jones’ team.
Reffkin told the assembled crowd he hoped to put them at ease about the merger, which he said had not been inked yet.
The Compass CEO also announced there would be a “post-vetting” process for Pacific Union agents, Sockolov said, which could mean some agents may not stay on with the company.
Pacific Union has 54 offices in California, while Compass has 13.
Sockolov said she had exchanged texts with the Pacific Union chief on Tuesday afternoon. McLaughlin seemed confident about his future at the combined California operation, she said.
On Wednesday, McLaughlin sent a memo to Pacific Union employees. Once the deal was finalized, he told them, “I will continue to lead you and our work, along with our leadership team of Patrick V. Barber, Nick Segal, Scott Gibson, Brent Thomson, Sam Kraemer, and Leah Sternberg.”
McLaughlin’s leadership in Los Angeles led some agents to jump ship. After Pacific Union took over the John Aaroe Group in 2016 and rebranded the combined company Pacific Union International, a number of agents — including Forster Jones and her entire team — left. Forster Jones joined Compass in February; Sockolov was among those who made the move.
Sockolov said that after several months under the Pacific Union banner, “we were not getting the things we were promised,” including better office space.
Some agents also bristled at the sudden departure of Steve Lewis, who formerly managed John Aaroe’s Beverly Hills office. Lewis said Segal — Pacific Union’s Southern California president — fired him in March, after having accused Lewis of entertaining an offer from Compass. Segal and a Compass spokesperson did not respond on Friday to requests for comment about Lewis’ departure.
In May, Lewis founded CORE, a boutique brokerage in Beverly Hills, and soon signed around 30 agents, most from Pacific Union.
Since leading the acquisition of Pacific Union in 2009, McLaughlin, a Bay Area native, has grown the company from 424 employees with $2.2 billion in annual sales volume to nearly 1,700 agents and support staff with $14.1 billion in sales last year. His acquisitions included John Aaroe, Partners Trust and Gibson International.