Brokers who are up in a down market

Sean Oakes, a vice president at Halstead Property, is having his best year ever. So far, he’s earned nearly 40 percent more than last year, and he’s on track to double his 2008 take-home pay by the end of the year.

How did he accomplish this feat in the worst market in more than a decade? Simple. Oakes gets referrals from a real estate attorney, who alerts him every time her firm is handling a troubled mortgage. Another friend, a landlord in Williamsburg with extensive contacts, does the same thing.

“He’ll say, ‘This person is receiving threats from the bank and needs to sell, can you call her?'” Oakes said.

Most real estate agents are having an understandably difficult time in the current market, with sales and rental transactions down by half from last year. A few savvy agents, however, are doing better than ever by using the down market to their advantage. This month, The Real Deal tracked down some of them to find out how they’re doing it.

Without exception, the agents said that backbreaking work, patience and a bit of luck are essential to success in this market. But they’ve also learned how to go where the deals are and carve out unique niches for themselves.

Oakes, for example, worked almost entirely in Brooklyn this year, though his office is in Midtown. He made the switch after realizing that foreclosures are more common there than in Manhattan. He said his “niche is people who need to sell.”

Once he finds sellers — often those who have lost jobs or taken a beating in the stock market — he’s very blunt about market conditions. If they don’t want to hear it, he moves on to the next client.

“I just wait for the right person,” he said, noting that these sellers often come back to him after realizing that other brokers don’t follow through on their promises. “I don’t take overpriced listings.”

This crucial combination has served him well.

In May, it took Oakes six days to sell a two-bedroom condo at 100 Jay Street in Dumbo for $835,000, close to the $865,000 asking price. He also put a one-bedroom co-op at 200 Congress Street in Cobble Hill in contract after only three weeks for $400,000, down from the asking price of $450,000. The home had previously been listed with another broker at $525,000, but hadn’t received an offer in a year.

“This is certainly the best year I’ve had since I’ve been doing this,” said Oakes, who has been in real estate since 1998.

Other brokers are finding motivated sellers through estate sales.

Estates need cash for taxes and other expenses, so the heirs are often anxious to unload the property, explained Harriet Kaufman, an associate broker and executive managing director at Warburg Realty, who has sold three estate-owned apartments this year for prices ranging from $2.5 million to $5 million.

“These are people who are going to sell,” she said.

But estate sales aren’t for the faint of heart, she said, because they require navigating an emotional minefield of grieving heirs who are often dismayed to find that their deceased relative’s property value has fallen in this down market.

“For the heirs, it’s about expectation management,” Kaufman said. “People are disappointed.”

It took all her diplomatic skills to convince the heirs she worked with on her estate deals this year to price the properties correctly. “Slowly but surely, we brought the prices down to saleable levels,” she said.

Kaufman also shepherded a $30 million deal to the closing table in January, at the height of the paralysis spawned by the Lehman Brothers crash. Kaufman represented the buyer of a penthouse in the Skylofts building at 145 Hudson Street in Tribeca, which set a record for the highest-priced Manhattan apartment sold below Columbus Circle.

The deal had been signed last summer, before the market turned, so it was a small miracle that it closed intact. Kaufman credits the success, in part, to her good relationships with the buyer and the selling brokers.

“I have a track record and a big referral base,” she said.

S. Jean Meisel, a senior vice president and managing director at Brown Harris Stevens with more than 20 years of experience, agreed that a good reputation is now more important than ever.

She said she tries to treat every listing with the same level of service, no matter how big or small. That’s proved to be beneficial in this environment, where the lower end of the market has been stronger than the high end.

Meisel’s deals this year have ranged from a one-bedroom she recently sold for $655,000 to a four-bedroom, 3,478-square- foot unit, #11B, at 15 Central Park West, which closed in July for $17.5 million, according to the real estate Web site StreetEasy.

“You never know what portion of the market is going to be vibrant,” Meisel said. “That’s always been my attitude about diversity.”

She’s also not letting her multi-million-dollar exclusives stop her from doing rentals, including one Upper East Side duplex co-op, owned by an estate, that will soon go on the market for $30,000 a month.

Century 21 NY Metro’s Wes Stanton is another agent doing more rentals than usual this year. Stanton, originally a rental broker, began transitioning to sales about three years ago. Then, when the sales market plummeted in the fourth quarter of 2008, he directed his six-person team to take advantage of old contacts and start focusing on rentals again.

It has paid off. In 2008, Stanton did 165 transactions and brought in $500,000 in gross commissions, but he’s already surpassed that in 2009, and is on track to bring in $1 million in gross commissions by the end of the year.

Rentals give the team a steady source of income, which they use to supplement their advertising budget and help do more sales, Stanton said. That helps them snag business from competitors who have slashed their marketing budgets.

“We stood out, and took a nice little market share,” Stanton said.

It helped that the team was already well-positioned to sell lower-end apartments because of their ties to the rental market.

“My business was well-suited to focus on one-bedrooms and studios,” he said. “A lot of clients in the past have gone on to purchase apartments.”

David Kornmeier of Brown Harris Stevens has also adapted well to the down market. An up-and-comer who joined the business seven years ago, Kornmeier is the youngest person the firm has ever named a vice president and director.

Kornmeier cut his teeth as a buyers’ broker, working as an assistant to veteran BHS townhouse broker Wolf Jakubowski. When he went out on his own a few years ago, Kornmeier focused his attention mostly on exclusive listings. But when New York became a buyer’s market this fall, he quickly switched gears, contacting old clients to see if they were still house-hunting.

“Now that the market has shifted, I went back to buyers,” Kornmeier said. “I’ve been calling the guys I haven’t talked to for a while.”

Those contacts have come in handy. In July, Kornmeier did his biggest deal ever, representing the buyer of a 25-foot-wide townhouse at 5 East 78th Street. His client paid $15 million for the home, last listed at $18.5 million.

The buyer had been in the market for years, Kornmeier said, but today’s low prices persuaded him to finally sign on the dotted line.

Kornmeier also recently did his largest direct deal (representing both the buyer and seller), at 130 East 82nd Street. He’d had the listing for a long time, but early last month, he was able to bring a buyer to the property, selling it for close to the $6.75 million asking price.

Sherry Matays, a senior vice president at Corcoran, also shifted her strategy this year, relying less on open houses as a selling tool.

This winter, “you could no longer count on people coming to open houses,” she said. “You couldn’t funnel people in as easily as you had been able to.”

So she told the agents on her team to tailor showings to buyers’ schedules, even if that meant returning to the same apartment three or four times a day and working longer hours.

“It was a shift in commitment,” she said. “Our lives had to change.”

Matays is also a believer in doing a diverse range of deals. This year, she said, her team has closed deals ranging from just under $600,000 to $12 million. In mid-July, Matays closed on 285 Central Park West, unit #3S. Listed at $6.995 million, it went into contract in May for $6.35 million.

“We don’t forget about those smaller people,” she said. “They’re totally germane and important to our business.”

Some brokers have an advantage because they happen to work in areas that have fared relatively well in the face of the downturn.

For the past few years, Tom Doyle, a vice president at Bond New York, has focused primarily on selling in Soho, where he lives, and nearby Noho and Greenwich Village. Once the market started to slide, he found he was doing even more of his business in the area. Moreover, he said, nervous buyers and sellers seem to trust him because of his experience in the neighborhood.

“Having a good handle on the neighborhood helps people feel more comfortable with a broker,” said Doyle, who carries a stack of business cards with him when walking his dog near his home.

At the end of January, Doyle signed a contract at 95 Greene Street for $3 million from a French all-cash buyer, closing in March. In April, he sold a loft at 5 Great Jones Street in Noho — once inhabited by jazz legend Charles Mingus — for $1.85 million.

Another broker with a unique niche is Susan Singer. In addition to being a senior vice president at Corcoran, Singer is also one of only about 5,000 certified eco-brokers in the country.

Singer said she is doing better than last year in both transactions and dollar value, and that being an eco-broker has helped her as the fascination with the green movement intensifies.

“It helps me because I stand out from the pack,” she said.

Still, she said, sometimes a broker’s success is mostly about being in the right place at the right time.

Singer sold a penthouse at Chelsea’s London Terrace in May for $4.4 million, after it had been on the market for only five weeks. She got the listing for the 20th-floor home, which has four wrap-around terraces, because she lives in the building and a friend of the seller recommended her. “It was an exceptional property,” she said. “Those are the lucky breaks.”