Two years after George Floyd’s death, is real estate honoring its pledges?

Industry leaders promise renewed focus on diversity and equity as industry reckons with its past

Pam Liebman, Bess Freedman and James Whelan
Pam Liebman, Bess Freedman and James Whelan

In the days following the May 2020 murder of George Floyd by a Minneapolis police officer, real estate leaders did something unusual for an industry that tends to shy away from social issues: They spoke out. 

Many pledged a renewed focus on ensuring their workforce was diverse and inclusive, that employees of color felt supported and saw a path to advance their careers. They promised to seek out organizations dedicated to fighting racial inequity.

Ryan Davis, director of engagement, diversity and inclusion at the National Association of Realtors, described it as an “awakening.” Real estate needed dedicated efforts to advance those causes. Two years later, these efforts, he said, are still in their “infancy.”

This awakening is institutional,” Davis said. “It is certainly not an awakening for many Black and brown members, who have disproportionately observed or directly experienced discrimination and other forms of mistreatment within and beyond the industry.”

For years, the real estate industry played a pivotal role in encouraging racial segregation, profiting from blockbusting and other discriminatory tactics eventually banned by the Fair Housing Act of 1968. While there has been some recognition within the industry — especially in the period of reckoning immediately following Floyd’s death — that behaviors of the not-so-distant past have continued to inform how professionals interact with each other and their communities, experts say that two years later, some of that momentum has been lost.

Many companies and organizations in the industry have ramped up their fair housing training requirements, revisited hiring practices and launched internship and mentorship programs aimed at providing people of color support both early on in their career and beyond. 

There is still little transparency around racial representation within the industry, compounded by the fact that some companies and organizations do not track it — and those that do, especially private firms, are not keen to share it. In residential brokerage, the fact that agents are independent contractors can also limit the scope of diversity and inclusion initiatives. 

While there has been a change in expectations around these efforts, their effectiveness varies by company. Hiring a person dedicated to diversity and donating to a social justice organization will not alone change a firm’s culture. And saying a company is committed to equity is different from showing that to be the case.

“It does take a lot of intentionality,” said Julia Lashay Israel, who heads inclusion and belonging at Keller Williams. “It does not just happen.”

Where we are

Following the death of Floyd, several real estate executives told The Real Deal that the incident would shape their business going forward. As with much of corporate America, executives promised to focus on diversity and racial discrimination in the industry. 

In June 2020, Pam Liebman, CEO of the Corcoran Group, told agents that she would take a  “microscope to this company,” and that the firm was “redoubling our commitment to inclusion and justice.” She said the brokerage does not hire at the executive level until it has considered a diverse slate of candidates. 

“As a business leader, it is my responsibility to prioritize inclusion and representation in our company,” she said when interviewed for this story. 

The firm holds training on unconscious bias throughout the year and provides educational opportunities for members of the communities in which it works. In April, Corcoran held a day-long housing expo in Brooklyn with panels on the homebuying process and strategies for improving a potential buyer’s credit score. Liebman acknowledged that there is still much work to be done. 

“George Floyd may have been a wakeup call to many, but sadly, so much that came to the forefront in that ugly time still exists,” she said.  

Some firms have not sustained the momentum of two years ago, according to Israel.

I’ve seen a lot of that fall off,” she said, though she praised actions taken by Keller Williams, which established her role last year. In June 2020, CEO Gary Keller announced that he was launching a social equity task force aimed at eliminating “any racial disparity within our company, our industry, and how we can lead the way in the communities where we live and work.” 

As part of these efforts, the company set out to train 10,000 agents last year through diversity and bias-prevention courses. It nearly reached that goal: 9,400 agents took one of the courses, Israel said. The firm has also partnered with Kaplan to provide free pre-licensing courses and continuing education in certain states to help eliminate some barriers to entry in the industry.

Asked about his firm’s progress in the past two years, Redfin CEO Glenn Kelman said that Black or African American employees now represent 10 percent of the firm’s workforce, up from 8 percent in 2020. The company also has slightly more Black representation among its leaders, tapping Jason Aleem to lead client service and sales strategy in February and adding Kerry Chandler to the board in August 2020. At the start of 2020, none of the firm’s senior executives or board members were Black, Kelman said.  

After Floyd’s death, Bess Freedman, CEO of Brown Harris Stevens, told agents that “as real estate professionals, we serve our communities, and it is incumbent upon us to stand with them as they grieve and rebuild.”

She said she has encouraged agents to vote and be civically engaged, noting that Election Day is a paid holiday. The firm has fair housing training every two years, and a list of diverse real estate vendors for agents and employees. 

She acknowledged that because agents are independent contractors, and not technically employees, participation can be a challenge. 

“You can’t force an agent,” Freedman said. “But you can inspire them.”

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Not just lip service”

James Whelan, president of the Real Estate Board of New York, said in 2020 that Floyd’s killing underscored “systemic issues of race and class” that the city and country have failed to address, and he pledged the industry would provide real solutions and “not just lip service.”

Asked how REBNY has followed up on that pledge, Yvonne Riley-Tepie, its senior vice president of social impact, pointed to the organization’s internship program, which has worked with 150 undergraduate students with diverse backgrounds each year for the past two years, as well as its newly launched fellowship program for midcareer professionals. 

Darcy Stacom, who heads New York investment sales for CBRE and is co-chair of REBNY’s diversity committee, said there needs to be more outreach to undergraduates to make clear that not every career path in real estate involves a high-stakes, commission-based role. She emphasized the need to broaden the pool of future talent in the industry, and to create a support system for those professionals once they arrive at companies.

After George Floyd, every Black professional, every Hispanic professional, their phones blew up,” Stacom said. “They blew up with new career opportunities, they blew up with requests to be on charitable boards, to get involved with DEI committees, you name it.”

If you didn’t have a lot of diversity in the industry before, you don’t have that big of a pool of talent to pull from. So it’s really the creation of a wider pool over time,” she added.

Some efforts have fizzled out. In January 2021, real estate management consultant T3 Sixty launched a nonprofit dedicated to “improving diversity in the residential real estate brokerage industry.” By August, the company announced that it was pausing the foundation’s activities, due to lack of “bandwidth or interest” among industry associations and companies, which it said were “distracted with a complicated real estate market and the challenges of the surging Delta variant.”

With Diversity, Equity and Inclusion often a political hot potato, many people in our industry also appear to be uncomfortable or not ready to participate in a broad-based initiative of this nature,” the statement added. 

By the numbers

In November 2020, NAR President Charlie Oppler issued an apology for the organization’s contributions to racial inequality, citing its initial opposition to the Fair Housing Act and its exclusion of members based on race and gender. 

“Because of our past mistakes, the real estate industry has a special role to play in the fight for fair housing,” Oppler, who is also the CEO of Prominent Properties Sotheby’s International Realty in northern and central New Jersey, said in a statement at the time. 

Davis, who took his position at NAR 10 months ago, said that the organization is in the process of forming a “strategic framework” that will likely be available early next year. The plan will be based, among other things, on representation in leadership roles, the association’s culture, the partnerships it pursues and how it thinks about advocacy regarding diversity and inclusion. 

He said the organization’s membership “does not reflect the demographics of the country,” noting that NAR’s membership is disproportionately white, especially among those in leadership positions.  

A 2021 survey of NAR’s members found that 78 percent were white, 9 percent Hispanic and Latino, 7 percent Black/African American, 6 percent Asian and Pacific Islander, 1 percent American Indian, Eskimo and Aleut. Aside from this snapshot and Census data, it can be difficult to track demographic information in the industry, especially by specific sectors. 

Public companies like Redfin and Corcoran’s parent, Anywhere (formerly Realogy), publish some aggregated data on company demographics, though the latter does not include agents in those stats. When asked, REBNY representatives indicated that the organization does not track the demographics of its membership.

The industry is still grappling with allegations of racial discrimination related, in part, to how agents interact with prospective clients. The latest report by the National Fair Housing Alliance found that the pandemic “did not appear to mitigate discrimination,” given that more than 28,000 fair housing complaints were filed in 2020, a level consistent with previous years. The New York-based Housing Rights Initiative has filed several lawsuits against prominent residential brokerages, including Douglas Elliman, Coldwell Banker, Corcoran, Compass and Re/Max, alleging that their agents discriminated against prospective tenants with Section 8 vouchers. 

The way ahead

Davis said representation is important, but focusing on that alone is short-sighted. If a company is thinking comprehensively, it is also looking at culture. A CEO who is committed to inclusion and equity, he said, doesn’t just hire a DEI officer and expect that person to be solely responsible for enacting the necessary changes. The diversity officer should be an adviser to the CEO, who should in turn provide regular communications to employees about expectations and progress made. 

Davis noted how NAR’s safety, diversity and fair housing committees are studying how to advise members on situations like that of real estate agent Eric Brown, who was showing a listing in Michigan last year when the home was surrounded by police officers with their guns drawn. A neighbor had called 911, thinking a burglary suspect had returned. 

“It is not just being held at gunpoint,” Davis said. “Many Realtors of color  experience daily microaggressions, their credibility is questioned. And they report that they face mistreatment from all different directions.” 

Real estate consultant Lee Davenport said companies and associations are taking a more proactive approach to diversity and inclusion than they were two years ago, though she has noticed a certain level of “fatigue that is settling in.” She said regular fair housing training should be a condition for agents to renew their licenses. She also suggested that there should be more industry-wide recognition, perhaps through awards, for companies and individuals demonstrating a high level of commitment to DEI issues. 

Most industry professionals recognize that there is more work to be done. 

I think, as an industry, have we made progress? Yes,” Freedman said. “I think people care deeply and want to do the right thing. I think that shows progress. Does it mean racism is gone? Absolutely not.”