Berkshire Hathaway is betting big on New York — will it work?
The company’s RE arm acquired Westchester brokerage Houlihan Lawrence -- what's next?
A little more than a week after establishing its first New York City office, Berkshire Hathaway HomeServices of America continued its expansion by snapping up Westchester’s top residential brokerage, Houlihan Lawrence. And its quest to establish itself as a top player in New York City looks far from over.
The acquisition of Houlihan Lawrence this week gives HomeServices 1,300 agents across 30 offices in Westchester, Putnam, Dutchess counties in New York and Fairfield in Connecticut.
The financial terms of the deal were not made public. The buyout firmly establishes HomeServices’ presence in the Westchester market. HomeServices CEO Ron Peltier told The Real Deal that the firm has worked to break into the lucrative New York market for nearly five years. He said the new office in Manhattan, along with the acquisition of Houlihan Lawrence is the “fruit of those labors.” He added the company had not yet found a brokerage in the city that “fit the criteria” for acquisition, but they would continue the search.
“It doesn’t preclude us from future opportunities acquiring companies in Manhattan,” he said. “We have put our stake in the ground.” He declined to name brokerages the company was interested in acquiring, or any companies HomeServices had approached in the past.
“It’s a great acquisition, no question, in Berkshire’s game plan to expand,” said Donna Olshan, president and founder of Olshan Realty [TRDataCustom]. However, she said a strong presence in Westchester does not necessarily mean the company’s foray into New York City will pay off. “The success of the office in the city really depends on the agents and who they attract,” Olshan said. “Companies do well if they start in New York City and then they expand. They do not do well when they go from the outside and then try to move into New York. They just don’t understand the culture here.”
The chairman of the Houlihan Lawrence, Nancy Seaman, will step aside as part of the move. Her brothers, president and CEO Stephen Meyers and managing principal Chris Meyers, will stay on to manage day-to-day operations. Like the other brokerages HomeServices has acquired, Houlihan Lawrence will retain its name.
Chris Meyers, who has owned Houlihan Lawrence with his siblings for 27 years, said they agreed to the acquisition to ensure “the legacy” of the firm in the area.
Houlihan Lawrence topped the list of The Real Deal’s ranking of Westchester County Residential brokerages for 2016, with $3,655,705,998 over 3,625 transactions. The firm towered above its rivals, notching roughly triple the sales total of Julia B. Fee Sotheby’s International Realty, which placed second in the ranking.