Keller Williams Midtown downsizing offices amid belt-tightening
Resi firm’s move to 575 Fifth will minimize expenses, sources say
Keller Williams Midtown is downsizing — the latest indication of how the residential firm is tightening its belt amid a tough market.
The brokerage informed agents earlier this week that it would leave 1155 Avenue of the Americas and relocate to 575 Fifth Avenue on Aug. 26.
“This decision underscores our commitment of minimizing expenses and maximizing the amount we are able to profit share back to our agents,” Elizabeth Cho, the office’s team leader, wrote in an email to agents, a copy of which was obtained by The Real Deal.
The Midtown office is a franchise of Austin-based Keller Williams, the biggest residential firm nationwide by agent count.
Owned by Ilan Bracha and Haim Binstock, the Midtown office first opened in 2011. Since 2015, the firm has occupied 29,000 square feet at Durst’s Sixth Avenue tower, space it subleased from Dow Jones. (The deal was reportedly for $1.4 million a year.) At its peak, the Midtown office had more than 800 agents.
But as the market has slowed, things have been rocky for the franchise, and over the past year agents have gone to other firms amid tumult in the C-suite.
In April 2018, Keller Williams Realty International sent a letter of default to the Midtown franchise — which is run separately from Keller Williams Tribeca — citing an “alarming number of questions and concerns about the leadership and viability of the market center.” At the time, Bracha declined to comment but said the Midtown office was right-sizing after it grew too large by hiring agents who were not productive. Sources said the franchise was looking to sub-sublease its office.
Multiple calls to Bracha and other Keller officials were not returned. But brokerage sources said Keller Williams is moving into a WeWork location. The co-working company occupies more than 100,000 feet at 575 Fifth, a 40-story building with 500,000 square feet owned by Beacon Capital Partners and MetLife.
At 575 Fifth, WeWork private offices start at $1,050 a month for one seat and $18,600 for 21 to 50 seats, according to its site.
Keller Williams (both the Midtown and Tribeca offices) was No. 6 on The Real Deal’s most recent ranking of top Manhattan residential firms, with 686 agents — a 16.34 percent drop from the prior year. It closed 187 sell-side deals valued at $204.5 million, TRD found.
Earlier this month, Corcoran closed its Greenwich Village office, although company officials said the decision was made years ago to coincide with the expansion of other locations.
In January, CORE closed its first location at 127 Seventh Avenue. At the time, the brokerage said it had plans to open a retail space near Hudson Yards.