A total of 118 condos sold for $59.4 million in Miami-Dade County, an increase from 115 closings for $44.5 million the previous week. Condos last week sold for an average price of about $504,000 or $381 per square foot.
The most expensive sale was the $7.3 million closing of Palazzo Del Sol unit 7065. Dora Puig represented the buyer and seller of three-bedroom, 3,793-square-foot condo. It was on the MLS for nearly a year before it closed for $1,925 per square foot.
The second most-expensive condo sale was the $4.2 million sale of Continuum South Beach unit 2607. Dina Goldentayer was the listing agent, and Jorge Martinez brought the buyer. The two-bedroom, 1,757-square-foot condo was on the market for 189 days and sold for nearly $2,400 per square foot.
Here’s a breakdown of the top 10 sales from July 14 to July 20. Click on the map for more information:
Palazzo Del Sol #7065 | 357 days on market | $7.3M | $1,925 psf | Listing agent: Dora Puig | Buyer’s agent: Dora Puig Least expensive
Ocean One #2310 | 360 days on market | $1.16M | $479 psf | Listing agent: Stefano Fontana | Buyer’s agent: Irving Weisselberger Most days on market
Ocean One #2310 | 360 days on market | $1.16M | $479 psf | Listing agent: Stefano Fontana | Buyer’s agent: Irving Weisselberger Fewest days on market
W Residences #1228 | 41 days on market | $2.9M | $2,341 psf | Listing agent: Gary Gold Waechter | Buyer’s agent: Ivan Chorney
Plans for a Royal Palm Beach project that has been referred to as the CityPlace of the West are coming closer to fruition as one phase of the Tuttle Royale development scored approval from village officials.
Royal Palm Beach’s village council voted to approve variances and a site plan that allow for 100 zero-lot-line homes — or houses that come close to the edge of the property — to be built on about 34 acres, according to the Palm Beach Post. Most of the homes will be built on 45-foot-wide lots.
The new residential development is part of a $650 million master-planned community led by developer Brian Tuttle that will include 1,000 apartments, 100 single-family homes, a charter school, a park and a 32-acre commercial center.
Tuttle told the council that Toll Brothers is under contract to build the homes, the Post reported. He originally sought to build townhomes on the property, but after some objections from the nearby neighborhood, he changed plans to single-family homes.
Tuttle began assembling the land from more than 100 owners in 2013.
About three years ago, he sold roughly 30 acres of the community to the Miami-based Related Group for $12.5 million. [Palm Beach Post] — Keith Larsen
Wells Fargo’s C. Allen Parker and JPMorgan’s Jamie Dimon (Credit: Wells Fargo and JPMorgan)
Falling interest rates are generally seen as a boon to banks’ mortgage business as borrowers increasingly take out new loans to buy homes or refinance.
But lower interest rates hurt some of the country’s biggest mortgage banks, which reported the size of their mortgage-servicing businesses declined in the second quarter.
Banks that have reported their second-quarter earnings disclosed that the value of the servicing rights fell between 7 percent and 10 percent, the Wall Street Journal reported.
Wells Fargo, the country’s largest holder of those rights, said the value fell 9 percent from the end of the first quarter to $12.1 billion. JPMorgan, the second-largest, reported a drop of 15 percent to $5.1 billion.
Banks usually use derivatives to hedge against volatility in service rights. But some were caught off-guard by how quickly interest rates shifted.
“Mortgage companies do best when rates move steadily in a direction as opposed to rapidly in a direction,” Stephen Lynch, a credit analyst at S&P Global Ratings, told the Journal. “We definitely saw a dislocation.”
Consumer mortgage originations grew at Wells Fargo, JPMorgan and Citigroup during the second quarter thanks to lower interest rates. Fed Chair Jerome Powell earlier this month signaled that the Fed will lower rates in the near future. [WSJ] – Rich Bockmann
Realogy announced Tuesday that it had entered a partnership with Amazon dubbed Turnkey, a new homebuying program through which homebuyers will receive up to $5,000 in complimentary Amazon products and services on move-in, courtesy of the brokerage giant.
“When we designed TurnKey, we recognized that ‘closing’ on a home is really just the beginning of the homebuying journey,” Realogy’s senior vice president and head of strategy Eric Chesin said in a press release. “We are proud to team up with Amazon to extend the value we bring to buying a home beyond the moment you first unlock your new front door.”
The program is currently available in 15 markets across the U.S., including Los Angeles, Chicago, Orlando and Tampa.
The real estate services company, which counts Century 21, Coldwell Banker and Sotheby’s International among its major brands, will match TurnKey agents with buyers “according to the homebuyer’s profile.”
In addition to a selection of Amazon’s smart home products, TurnKey’s Amazon move-in benefit will also include services such as deep cleaning and furniture assembly, and will vary in value between $1,000 and $5,000 according to the purchase price of the new home.
Earlier this month, Realogy filed an explosive lawsuit against Compass accusing the venture capital-backed firm of “predatory” recruiting tactics as attempts at price-fixing. Realogy’s stock continued to tumble that week, hitting a new low of $5.74 per share — a 75 percent drop from a year earlier.
The conglomerate’s market cap and stock were at roughly $592 million and $5.19 per share, respectively, at time of publication.
The Allapattah properties and Miami Mayor Francis Suarez (Credit: CBRE, Getty Images)
The city of Miami is looking to develop an 18.75-acre site it owns in Allapattah, as investment and development in the neighborhood ramps up.
The city tapped CBRE to issue a request for information from developers and investors for the property between Northwest 19th and 20th streets, and Northwest 12th and 14th avenues in Miami. The two-block site is north of Jackson Memorial Hospital in the Miami Health District.
Responses are due Aug. 12, according to CBRE. Michael McShea, Lee Ann Korst and Chris Wood of CBRE are representing the city.
The property is currently zoned CI-HE, which allows for about 6.5 million square feet of development across a mix of uses and 2,800 residential units, said Andrew Schimmel, senior project representative in the city’s real estate and asset management division. It could also be proposed as a special area plan, which would require at least 9 acres of land.
After the city receives responses, it will review them, meet with planning and zoning officials and the city manager’s office, and then likely issue a request for proposals, Schimmel said.
The property currently houses the city’s divisions of general services administration, public works, parks and recreation, solid waste and a fire station.
Schimmel said the goal of the request for letters of interest is to get the development community’s input on the highest and best use of the property, which could include keeping all five of the city departments on site, relocating them to other city-owned properties in Allapattah, and more. “Everything is on the table,” he said.
Several projects are currently planned for Allapattah.
Developer Robert Wennett is planning a 1.4 million-square-foot mixed-use development on the Miami Produce Center property at 2140 Northwest 12th Avenue. Designed by Bjarke Ingels, the project will have as many as 2,400 co-living units and 637 traditional residential units, 231,000 square feet of office space, 129,000 square feet of retail space, 22,000 square feet for educational uses and more than 1,000 parking spaces.
On 20th and 21st streets between 10th and 11th avenues, Deco Capital Group recently purchased land where it eventually plans to build a mixed-use medical office development.
Developer Lissette Calderon also filed plans for her second planned apartment project in the neighborhood. The latest proposed mixed-use development, called 16 Allapattah, would have 323 apartments and a 336-space parking structure at 1625 Northwest 20th Street.
The trend could reverse as younger people start to enter the real estate market (Credit: iStock)
About 37 percent of households in the U.S. are living without mortgages.
The share of homeowners paying off their mortgages has increased by 5.5 percentage points over the past decade, according to Bloomberg, citing data from Zillow. This is in part due to an aging population of homeowners, as younger Americans tend to wait longer to buy property thanks to factors like student debt and increasing living costs. The trend could reverse as younger people start to enter the real estate market.
States with cheaper houses generally have higher rates of mortgages that are fully paid. West Virginia had the highest amount of mortgage free homes as of 2017 at 54 percent, while Maryland had just 27 percent and Washington D.C. had just 24 percent.
The country’s median home price has gone up by more than 60 percent over the past 10 years. [Bloomberg] – Eddie Small
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Miami star architect Kobi Karp and his wife Nancy paid $8.5 million to buy another waterfront home on Miami Beach’s North Bay Road.
The couple bought a 6,574-square-foot house at 4750 North Bay Road for $1,292 per square foot, records show. The seller is tied to Romita Shetty, a principal with New York-based DA Capital, which focuses on structured credit and private investments.
The couple previously bought a home at 5328 North Bay Road for $6.55 million in February 2016, records show.
It is unclear what the Karps plan to do with their latest purchase.
The bayfront house has six bedrooms and six bathrooms. It was built in 1932 and sits on a 20,000-square-foot lot. It was last purchased for $10.5 million in 2014, records show.
Dora Puig of Luxe Living Realty represented the buyer and the seller in the transaction.
Kobi Karp leads Kobi Karp Architecture & Interior Design and has designed many high-profile buildings in the Miami area. Karp’s projects include the luxury condo developments Palazzo Del Sol and Palazzo Della Luna in Fisher Island, Four Seasons Hotel & Residences at the Surf Club in Surfside, and the 1 Hotel & Homes in Miami Beach.
In addition to their homes on North Bay Road, Karp and his wife also own properties on Allison Island and Sunset Island III in Miami Beach, records show. A new home is under construction on the Sunset Island site, Nancy Karp said.
Other high-profile homeowners on North Bay Road include JDS Development’s Michael Stern, singer-songwriter Phil Collins, and basketball stars Chris Bosh and Dwyane Wade.
Yext founder and CEO Howard Lerman paid $17 million in February for a 10,665-square-foot spec mansion at 6010 North Bay Road.
Deutsche Bank’s RREEF sold a Brickell office building to Gatsby Enterprises for $125.5 million, according to sources.
Gatsby Enterprises, a New York-based real estate firm led by principal Nader Shalom, and Master Mind LLC, led by Babak Ebrahimzadeh, closed on 800 Brickell, CBRE said. The 2-acre property includes a 209,122-square-foot office building and an adjacent 9-story parking garage. The firm declined to comment on the price.
CBRE’s Christian Lee and José Lobón represented the seller, RAR2-800 Brickell LLC. Darryl Kaplan of Darryl R. Kaplan Company represented the buyer.
The office building is 71 percent leased with about 61,000 square feet of vacant space. Isaac Shalom of Gatsby Enterprises said in a release that the company plans to renovate the exteriors and common areas, as well as bring restaurants to the building. He said that Gatsby Enterprises plans to acquire additional properties in South Florida’s urban core markets.
Gross asking rents are currently in the low- to mid-$40s per square foot, which will rise after the buyers renovate the building, Lee and Lobón said. It hit the market in early February. Miami 21 zoning allows redevelopment equal to 16.5 floor area ratio, or up to 1.4 million square feet of building area and up to 80 stories in height.
“In the long run, ultimately, it’s a development site,” Lee said.
Tenants include Anheuser-Busch, Lufthansa, Prudential, Adler Real Estate Partners and Bo Concepts.
CBRE’s Amy Julian and Andrew Chilgren worked on the deal, and Colliers International South Florida’s Steven Hurwitz and Douglas Okun helped market the property.
RREEF, an arm of Deutsche Bank, paid $111.6 million for 800 Brickell in 2015. Guggenheim Investments and Stiles Realty sold the office building at that time.
Nearby at 888 Southeast Brickell Plaza, also known as 830 Brickell, OKO Group is planning to build a high-rise, 940,000-square-foot office tower with 15,000 square feet of retail space, 490,000 square feet of office space, and a restaurant on the 53rd floor.
The Agency’s Mauricio Umansky (left) and Billy Rose (Illustration by Zach Meyer)
When Leonard Rabinowitz and Jack Friedkin left the Agency in September to join Hilton & Hyland, and Jay Harris took the same route two months later, the moves didn’t raise many eyebrows. Rabinowitz and Friedkin had been at the Agency four years, and Harris seven, but jumping ship has become more common in an era of brokerage consolidation.
But then Danny Brown, a partner at the time, left in December, setting off a chain of events more akin to an exodus.
In March, the Agency lost Cindy Ambuehl, a longtime partner, as well as David Kelmenson, a former partner at Partners Trust. The following month, managing director Don Heller left, followed by Stephen Sigoloff, director of residential estates, and most recently, top producer Dan Urbach.
Mauricio Umansky, Billy Rose and Blair Chang launched the Agency in 2011 to much fanfare. Its charismatic leaders sought to shake up the brokerage landscape with sleek branding and a star-studded approach to marketing — it was real estate, Hollywood style. “Nobody had come in to disrupt it [the business], to revolutionize it, to innovate it,” Umansky had said of the decision. The firm became emblematic of boomtown L.A. and was involved in some of the city’s priciest deals. Yet nowadays, even as the Agency celebrates new offices and throws $100,000 open-house events, a grim scene is playing out behind closed doors.
Between January 2018 and June of this year, the firm lost 45 agents in L.A. County, many of them big producers. That’s about 15 percent of the 303 agents it had in June, according to data on licensed employees from the California Department of Real Estate.
The company has been quick to fill the vacancies, adding 140 new agents in the same period. Still, that turnover is about double the number seen at Hilton & Hyland. Compass, which is around five times bigger in L.A., saw 55 agents leave during the same time.
The departures come as the Agency and Umansky fight a legal battle with the vice president of an authoritarian Central African nation over Umansky’s sale of his Malibu estate. Meanwhile, co-founder Rose stepped down as the firm’s broker of record weeks before the litigation was filed.
But brokers say it’s not just the legal drama that pushed them out. They criticize the firm’s emphasis on “sharing,” which some see as a euphemism for management piggybacking on agents’ hard-won listings.
For this story, The Real Deal interviewed many former and current Agency agents, as well as several outside industry leaders. Some think the Agency has lost its edge amidst its rapid expansion, which has seen its office count nearly triple over the past two years to 33 and its total agent roster balloon to 585. And while its founders still refer to the company as a “boutique,” it’s no longer got the small-shop feel that set it apart.
“When they had one office, that was when they really blossomed,” said Aaron Kirman, a top luxury broker at Pacific Union International, now part of Compass. “I think where they started the decline is when they started getting multiple offices. Now they have offices all over the place. At that point, it’s hard to protect the brand.”
Coming in hot
The Agency burst onto the scene as the market was bouncing back from a recession. Developers were starting to put multimillion-dollar bets on spec homes, a practice that would transform the Southern California landscape and create scores of high-priced new listings. New agents, hungry for their first million, were flocking to the action.
Umansky had established a stellar track record at Hilton & Hyland, emerging as the firm’s top producer for seven years running, while Rose and Chang were running their own top-ranked team at Prudential. In 2011, the trio created the Agency, setting up shop in a 1,800-square-foot office on Beverly Drive. The space was modest, the ambition anything but.
“I believed that the brokerage model was sort of broken, and I thought there was an opportunity to start a company that sold real estate differently,” Umansky said. “The mission was to create a boutique firm with global reach.”
Jason Oppenheim, founder of Oppenheim Group, said the Agency was a pioneer in breaking from the “brokerage-centric model,” where the name of the brokerage mattered more than the individual agent. Calling it both “inspirational and risky,” Oppenheim said Umansky was asking people to join an Agency that “didn’t have its bearings under it.”
The gambit worked. Agents and clients were attracted to the firm’s approach, which included the market’s first luxury lifestyle newsletter.
“I remember being really impressed at the time,” said Spencer Krull, general manager at Westside Estate Agency in Beverly Hills. “Their marketing at the time was really different than what anyone else was doing. They came on the stage very strong.”
Not only did the Agency offer full marketing support to its brokers, it would promote those capabilities to potential clients to win business. It also went full-tilt on open houses, which before the firm came along were largely sedate affairs. A 2013 open house for a $29 million listing on Sunset Plaza featured celebrity chef Michael Voltaggio, $3 million worth of Lamborghinis in the driveway, a DJ and an open bar. The parties have since escalated to include champagne-pouring aerialists and pop-up breweries.
Fueled by a strong market, Umansky and other Agency brokers would also often price homes at numbers that appealed to sellers, sources said. Umansky denies such claims.
“When they got in the business, we were on an uptick,” said one broker. “You could get away with a lot of things. And they had that swagger and that hip vibe, so the timing was great.”
Umansky also wielded a trump card few other agents could hope to: exposure on national television. His wife, Kyle Richards, had been the star of Bravo’s “Real Housewives of Beverly Hills” for a year at the time, giving Umansky and his fledgling company a free platform from which to promote their business. Former agents recall instances where Umansky and now-“Million Dollar Listing Los Angeles” stars David Parnes and James Harris would persuade clients to list with them by luring them with the prospects of being filmed for television.
“We do use television to our advantage, like all the casts of these shows,” Umansky said. “We are lucky enough that people want to pay us to be on TV, not the other way around.”
As for agents, Umansky said he “did zero recruiting.” “We wanted to be a boutique, a high-service firm, and it was more like a club that people wanted to be a part of,” he added.
Sources agree that the Agency did not “recruit aggressively” like companies do today, but said it was common for early agents to attract their friends and other high performers. Heavy hitters like Jeeb O’Reilly, Kofi Nartey, Heller, Sigoloff and Ambuehl were among the first to join.
“The thought of starting a new agency from ground zero was so exciting,” said O’Reilly, who had joined from Hilton & Hyland. “I felt we had the greatest formula. We had fabulous public relations, fabulous marketing and a great vision.”
The Agency started winning — and selling — big listings. In 2014, Umansky sold the palatial Carolwood Estate, once owned by Walt Disney, for $74 million. He was then involved in the record-breaking $100 million sale of the Playboy Mansion two years later. While Umansky was by far the biggest rainmaker at the firm, other agents made bank, too: Santiago Arana, now a partner, sold the home used in “Beverly Hills Cop” for $23 million in July 2015, two years after selling Larry David’s home in Pacific Palisades. Ambuehl landed $20 million for the home of “Full House” creator Jeff Franklin that same year. Rose broke a record in Santa Monica’s Sunset Park when he sold Ryan Phillippe’s home for $15 million.
Sharing is caring
By many accounts, the Agency’s honeymoon period lasted for just under five years. Serious issues then began cropping up.
“I couldn’t stay because they had stolen a big client from me and lied about it to my face,” O’Reilly, who left the firm in 2015 and is now at Compass, said. “When I brought it up, they just looked at me and said, ‘We didn’t know you were working with her.’’’
Other agents told a similar tale.
“Any time we would try to bring a listing, they would say, ‘You don’t need to work on this listing’ and just take every single deal out of our hands,” recalled one. Another remembers an instance when an agent mentioned an A-list celebrity client at an all-hands meeting, and the owners then went after that client. When the agent complained, they were told it would be made up to them at a later time. It wasn’t, they said.
Agents who joined the company were sold on a notion of “sharing” and “collaboration,” they said. The idea was that founders would pass on listings to rising agents for a small referral fee. For a 50-50 split, agents could also tap into a principal’s expertise to sell a listing.
But those splits didn’t always come to pass, sources said. In one instance, an agent’s commission ended up being much lower because marketing and other expenditures were taken out of the agent’s share.
“My check should have been for $100,000, but I got $5,000,” the agent said. “They were robbing us blind.”
While Umansky said it’s “sad” people feel that way, he contends that sharing is central to the business model.
“If we were stealing clients, we would not be able to expand our business,” he said.
While the model worked for some younger agents who may not have secured a $20 million listing without Umansky’s clout and public profile, it didn’t sit well with others who now say it was a bait-and-switch structure that mostly benefited the owners.
“Between the [owners], they had tons of business,” said one former agent. “They were saying that everything was going to be a team effort, and that they were not interested in being salespeople. It ended up being complete lies.”
Umansky denied that this is an issue at the company. While he said he has heard “rumblings,” he maintained that the Agency “shares more, gives more than anybody else.” Umansky currently has 43 active listings, valued at more than $1 billion, an Agency spokesperson said.
“When you are doing incredible stuff,” he said, “you have a target on your back.”
Supporters argue that other firms in L.A. utilize the same tactics. The broker-owner model, Oppenheim said, works because the brokerage has two sources of income: the broker’s listings and its agents’ listings.
“They’re able to leverage the ownership to bolster their own real estate business as agents,” Oppenheim said. His firm and Hilton & Hyland work in a similar way, he added.
“I think that his [Umansky’s] name on listings has actually really helped smaller agents who are looking to catapult to the next level,” said Ambuehl, who left the Agency in March. “Mauricio is not putting himself on everyone’s listings so he could be the big dog.”
The situation appears to be especially fraught in the firm’s Brentwood office.
Several of the firm’s former top producers who were based in that office are out. One broker described it as “an absolute mess.”
Sources cited issues with Arana, who is the managing partner at the office. They said he prioritizes selling over managing, often putting himself on listings or going after major clients.
“A lot of agents felt like the person running it was having practices that were not aligned with their interests,” said a former agent. “It’s become problematic.”
Arana rejects the idea that he is running the show — that job, he said, belongs to Doug Sandler.
“I have a managing partner title, but I wouldn’t call myself a manager because if I was then I wouldn’t be selling,” he said. Arana also develops: Two houses he built in Brentwood have sold to LeBron James and Formula One heiress Petra Ecclestone.
“The only listings that I have my name on with other agents is because they needed me to help get the deal done, or because I brought them in,” he contended.
Arana is the only Agency broker to crack the top 10 in TRD’s ranking of top brokers this year, coming in seventh with nearly $247 million in sales volume between March 2018 and February 2019. Harris and Parnes, also at the Agency, ranked No. 11 with $162 million in sales. Umansky declined to participate in the ranking.
At the Brentwood office, the Agency lost Ambuehl, Kelmenson, Heller, Sigoloff and Brown to Compass.
“I think quite honestly what’s happened to us at the Brentwood office is that Compass has a great recruiter, and they found a hole,” Umansky said. Arana is “an extraordinary leader” who “is doing none of that,” he added.
Ambuehl, who declined to comment on the Brentwood office, said that Compass, backed by SoftBank and valued last year at $4.4 billion, is “changing the rules of the industry.”
“That’s one of the big things the Agency and other agencies are going to be faced with,” she added.
A spokesperson for Compass said the firm is “humbled” anytime an agent from the Agency chooses to join Compass but declined to comment specifically on the Brentwood hires.
The curious case of Teodoro Obiang
“Did an L.A. real estate broker shortchange the citizens of an African nation out of millions?”
On the morning of Sept. 30, 2018, peering out from the Los Angeles Times’ business section, was the above headline. In a bombshell lawsuit, Umansky was accused of intentionally selling a 15,000-square-foot mansion on Malibu’s Sweetwater Mesa Road for millions less than it was worth, in order to later personally profit from the resale. The suit claimed Umansky had partnered with the buyer in a plot to resell the home for a far greater sum.
Umansky had been tapped to sell the home after the U.S. government accused owner Teodoro Nguema Obiang Mangue, the vice president of Equatorial Guinea, of using stolen funds to purchase the property.
Within seven months of listing, Umansky found a buyer. L.A. real estate investor Mauricio Oberfeld paid $33.5 million for the home in December 2015, and Umansky partnered with him on the purchase. However, the two resold it a year later for $70 million, more than twice what they paid, leading Obiang to sue Umansky and the Agency for damages and any profits made from the sale. Umansky maintains that he acted in good faith in the sale, which was supervised by the U.S. Department of Justice.
Western World Insurance filed a lawsuit against the Agency last August to protect itself from having to pay any damages to the seller, who was demanding that the Agency cough up $8 million for misrepresenting the value of the home. The Agency countersued, and the suit was dropped in October.
The seller has since taken matters into his own hands. Obiang filed his lawsuit in federal court in March and is suing Umansky and the Agency for damages and any profits made from the sale. Umansky and the firm maintains that the broker acted in good faith in the sale, which was supervised by the U.S. Department of Justice.
Umansky declined to comment on how the litigation has impacted the business. It’s clear that it was a public relations hit for the firm, but brokers said that such lawsuits are part of the cost of doing business at the top of L.A.’s real estate market.
“You can’t be a successful agent and not be drawn into some type of litigation,” Oppenheim said. “It’s almost a sign of being successful.”
Rather, it’s the actions taken by co-founder Rose around the time of the lawsuit that are more alarming, industry players said.
In the weeks leading up the first lawsuit, Rose stepped down from his role as the firm’s broker of record. He tapped Michael Caruso, who had been at the Agency less than a year at the time, to replace him.
Chang, the third co-founder, has kept a lower profile than his counterparts. He has about 15 active listings ranging from $2 million to $16 million, according to the firm’s website.
While the firm maintains that Rose stepped down in order to focus on “serving his clients,” others claim it was because of the lawsuit. Or worse, they say, the firm’s lack of funds pushed him to spend more time winning business.
“Don’t you think its weird when your managing partner resigns?” said one broker. “All of a sudden he’s back selling real estate, focusing on building the brand. That’s a sign.”
“What is he so afraid is going to happen that he’s removing himself from it?” another broker said. “It raised a lot of red flags.”
Built to sell
The Agency closed $4 billion in sales volume in L.A. County in 2018, ranking fifth on Los Angeles Business Journal’s list of top residential brokerage firms. That’s about 14.2 percent higher than its volume in 2017, when it closed $3.5 billion.The firm ranked behind Compass and Rodeo Realty, but beat Hilton & Hyland and Westside Estate Agency in the ranking. A spokesperson for the Agency added that the firm closed more than 2,000 transactions last year.
As of July 8, the Agency had 237 listings in L.A. County, according to an analysis of single-family and townhouse listings on the Multiple Listing Service. That’s nearly $1.6 billion in sales volume, which is roughly 40 percent less than Hilton & Hyland and Compass. The figure does not include off-market listings.
The Agency is actively expanding, pushing for more offices in Northern California as well as several others on the West Coast. This is at a time when luxury real estate markets are softening: In March, home prices in Southern California fell year over year for the first time in seven years, and a Douglas Elliman first-quarter report revealed that the number of luxury home sales in L.A. County dropped 31 percent year over year. Discounts on top-end estates have become standard.
Those in the business wonder whether the Agency’s flashy approach will serve it well during a slowdown.
“It’s going to be rough for them,” said one brokerage executive. “This is the first time they see a down market. I wouldn’t be surprised if they start to scale back a bit, or consolidate.”
Yet Umansky welcomes the challenge. He stressed that losing many talented agents hasn’t hurt the business, with offices running at capacity and new recruits replacing those who’ve moved on. For example, Sandro Dazzan, a former top producer at Coldwell Banker, joined to lead the firm’s Malibu office in February 2018.
“In my eyes, we haven’t lost anybody, because we have maintained the number of agents per office,” Umansky said. “Having said that, you usually see a lot of change in life during the time when markets are down.”
The firm began a franchising push a few years ago, expanding into international markets like Mexico and the Caribbean. It also has franchises in Turks and Caicos; Punta de Mita, Mexico; Victoria and Nanaimo, British Columbia; Park City, Utah; and Boca Raton and Jupiter, Florida. And it’s looking to enter markets in Tennessee and Texas, with an eye, when the “timing is right,” on the richest market of them all, New York City.
Industry veterans have questions about the firm’s endgame. Aggressive expansion like this is often a sign that the firm is prepping for a sale, they said.
“It appears as though, with all they are doing, they are setting up to sell it,” said Stephen Shapiro, co-founder of Westside Estate Agency. “I think their goal is probably to get as many satellites as they can and maybe they take whoever is ready to jump in instead of taking their time and doing it more slowly.”
Though the founders have long denied such claims, Umansky said he will consider “mergers and acquisitions.” Others point to failed 2016 discussions with New York-based brokerage Town Residential as support for the claim that the founders are looking to cash out.
Town had been in talks to potentially buy or merge the two firms. A source familiar with the deal said Town eventually pulled out after analyzing the Agency’s financials, which showed that the bulk of the business was in the hands of just a few power players. (Town ultimately closed in April 2018.)
Umansky claims it was the other way around.
“We were in talks to acquire them, not them to acquire us,” he said.
The Agency had made less than $1 million in net income in the 36 months ending December 2014, TRD reported at the time, citing financial statements Rose filed as part of his divorce proceedings. The filings showed that during that period, Rose took home $3.63 million in personal commissions plus nearly $360,000 in net income from his ownership stake in the firm.
“If they left, the company would make no money because none of these brokers would be able to land the business they land,” a source said in reference to Umansky and Rose. “They use their star power and their stature to make them bigger, and in turn sell that back to brokers who lack confidence or a brand name.”
The Agency has also been digging its teeth into new development. In 2017, the firm took over selling condos at Greenland Group’s Metropolis development in Downtown L.A. from Elliman. It then lost that listing to Polaris Pacific this past February, though Umansky hinted there have been “discussions” to potentially revisit selling the luxury units.
Sources questioned the legitimacy of their offices outside the Golden State.
In South Florida, one broker who was involved with the company there said the founders “didn’t do their due diligence” and ended up hiring “nobodies” to run the office.
“Franchises can be difficult because it’s all based on the culture you build, and every culture is different,” said Pacific Union’s Kirman. “I think it just led to a loss of the Agency having their identity.”
But to the face of the Agency, their growth has been “incredibly slow.”
“We’re a boutique,” Umansky said. “I’ve never bought a company. I don’t have $400 million. This is real growth.”
David and Victoria Beckham with a rendering of One Thousand Museum (Credit: Getty Images)
Now that David Beckham’s Major League Soccer team has found a permanent home in Miami, it makes sense that the soccer star is on the hunt for his own abode.
David and Victoria Beckham reportedly checked out a unit at One Thousand Museum this weekend, according to the U.K. publication the Sun. The Beckhams are spending the week in Miami on vacation, and were spotted hanging out with friends Eva Longoria and Marc Anthony.
Beckham is rumored to have viewed other Miami properties in recent years, including a waterfront estate on Star Island in Miami Beach.
Half-floor units at One Thousand Museum start at $5.8 million and full-floor residences go up to more than $24 million. The 62-story tower, known for its scorpion-like curvy columns that wrap around the exterior, was completed earlier this month by developers Louis Birdman, Gilberto Bomeny, Gregg Covin, Kevin Venger and Todd Glaser.
The 84-unit luxury condo building, at 1000 Biscayne Boulevard, was the first and final residential building in the Western Hemisphere to be designed by the late Zaha Hadid.
One Thousand Museum includes a rooftop helipad, a wellness center with a gym and yoga facilities, relaxation pods and spa rooms, a sky lounge, a bank vault, a multimedia theater, an off-site beach club and 8 Juice Bar by Raw Republic.
After years of attempts, Beckham and his partners are moving forward with their plans to build a soccer stadium in Miami, redeveloping the Melreese Country Club property into a $1 billion mega mixed-use soccer complex, home to their Inter Miami CF team. [The Sun] — Katherine Kallergis