There is the worn adage that real estate is all about “location, location, location.”
But while property may be local, capital markets, branding and tech make it easier to have a national reach these days. From co-working to proptech, it seems easier to scale geographically than ever. And now this trend seems to apply to real estate brokerage teams as well.
Our cover story this month looks at how New York’s top-producing resi team, headed by Fredrik Eklund and John Gomes, is expanding into Los Angeles and Miami in a sign of the times.
Eklund, the high-kicking star of the Bravo reality TV show “Million Dollar Listing New York,” recently uprooted his family to L.A. in a move that capped off nearly two years of expansion for the group. In a fraction of a real estate cycle, the Eklund-Gomes team has opened four offices in three cities and grown from nine agents to more than 70.
While entire residential firms have expanded nationally, the idea of brokerage teams doing so is a much newer concept. Whether the duo succeeds remains to be seen (neither is particularly gifted when it comes to organizational detail, Eklund acknowledged). Part of the execution will fall to their first CEO, Julia Spillman, who’s spearheading logistics behind much of the team’s growth. Check out the story by reporter Erin Hudson.
As Hudson notes, working in the celebrity broker team’s favor is a landscape that’s becoming more bicoastal — with developers working on projects in the Big Apple and City of Angels. “It’s New York money coming in,” said David Kramer, a top producer at the Beverly Hills-based luxury brokerage Hilton & Hyland. “Now the big players are national and international.”
Meanwhile, in one of the biggest stories in real estate right now (alongside the looming downturn), WeWork’s global expansion is set to reach a climax this month as the co-working giant gets ready to go public. Since the company launched nine years ago in New York, it has not only grown to become the city’s largest office tenant, but has also opened 528 locations in 111 cities.
That’s led to a homogenization of office space and the spreading of an entrepreneurial-hipster ethos. But the We Company’s pre-IPO filing also sheds light on a startup posting massive losses while issuing huge loans to its execs (including nearly $1 billion to CEO Adam Neumann). Read our key takeaways leading up to the IPO.
Of course, the seemingly endless profusion of proptech firms backed by venture capital and the many avenues to move money around the globe are also making the industry less hyperlocal than it once was, too. But the dissolution of borders may have its limits.
With the rise of global nationalism, trade wars and geopolitical turmoil, the residential market in New York has seen a clear drop in buyer interest from other countries. The number of foreigners who purchased homes across the U.S. fell by nearly a third over the past year, according to the National Association of Realtors. Reporter Sylvia Varnham O’Regan writes in our story that “even more worrying for many in the real estate world is, unlike in the past, there don’t seem to be any new groups emerging to fill the void.”
The commercial market has a more mixed outlook, though, which might be a bright spot as we flirt with a recession. See Kevin Sun’s deep dive into the top cross-border investment plays in the city over the past two years.
So, hopefully the stock market won’t bring too many surprises this fall — as it has during past autumns. Anyone remember the fall of 2008? Stay tuned for more coverage on what the looming downturn means for New York City real estate.
Enjoy the issue.