Chicago-based @properties announces national franchise play

Authored by:
Paul Hagey
Published:
October 2020

Launched in 2000, @properties has grown into the nation’s 11th largest brokerage by 2019 sales volume through steady organic growth in Chicago and in surrounding markets, including parts of Michigan, Indiana and Wisconsin. And now, fueled by a large equity investment from private equity firm Quad-C in 2018, the company has turned its sights nationally with a holding company and franchise system.

@properties stats

2019 sales volume (rank)2019 transaction sides (rank)2019 agent count, as of Dec. 31, 2019 (rank)
$10.75 billion (No. 11)21,877 (No. 17)2,963 (No. 19)
Source: 2020 Real Estate Almanac

The firm has established a new holding company, At World, which includes its company-owned operations in its core Chicago-area markets, and its franchise division. The franchise division launches with two brands: the @properties franchise brand, which will target larger markets; and Nest Realty, the Charlottesville-based brokerage and budding franchisor At World acquired in May, will remain focused on expanding to secondary and tertiary markets, largely in the south. The company may also choose to franchise Ansley, the Atlanta-based brokerage @properties acquired in March 2019.

Thad Wong

While initially focused on growing through franchising, @properties co-founder and principal Thad Wong says the company will evaluate acquisition opportunities as well and foresees company-owned stores in regions throughout the U.S.

The @properties franchise introduction establishes another large player to a coterie of real estate companies who operate brokerage and franchise divisions and represents further evidence for growth and consolidation in the industry. The economies of scale, access to large amounts of data and resources that larger companies can provide agents and consumers makes it increasingly difficult for smaller brokerages to compete.

T3 Sixty chronicled this in a previous Insight story this year with an analysis of San Francisco Bay Area-based Red Oak Realty’s acquisition of fellow East Bay brokerage Marvin Gardens Real Estate.

Realogy Holding Company sits at the top of these; its brokerage division, Realogy Brokerage Group, and its franchise division, Realogy Franchise Group (which has six large brands including Coldwell Banker and Century 21 Real Estate), did $504.21 billion in 2019 sales combined, making it the nation’s largest holding company in 2019. The next-largest holding company with franchise and brokerage divisions by 2019 sales volume was HomeServices of America, which did $270.39 billion in 2019.

Nation’s 5 largest brokerage and franchise operators

Holding Company (date established as a franchise and brokerage owner)2019 Sales Volume (Overall Holding Company Rank)2019 Transaction Sides (Overall Holding Company Rank)
Realogy Holding Company (1996)$504.21 billion (No. 1)1,387,152 (No. 1)
HomeServices of America (2012)$206.08 billion (No. 4)578,986 (No. 4)
Weichert Family of Companies (2002)$33.75 billion (No. 8)94,500 (No. 8)
Hanna Holdings (1997)$24.28 billion (No. 12)109,320 (No. 6)
HomeSmart (2000)$23.00 billion (No. 13)68,400 (No. 12)
Source: 2020 Real Estate Almanac

Wong says the national franchise push represents a years-long investigation into how to innovate and push the industry forward. The company looked at new business models and at new technology to introduce a change; in the end, it felt the best opportunity stood with “reshaping an old idea” in franchising. @properties has tapped Chris Lim, co-founder of the San Francisco-based brokerage Climb Real Estate Realogy acquired in 2016, to head its franchise efforts as president, head of brand growth.

Chris%20Lim.jpeg
Chris Lim

Wong says that the firm used its Ansley Atlanta Real Estate acquisition as a test case for applying its systems and coaching to a new firm, and the viability of its franchising vision. The results inspired @properties to launch pursue the franchise opportunity. In 2018, Ansley closed $598 million with 134 agents. @properties acquired the firm in March 2019 and worked quickly to apply its systems, technology and expertise to growing the company. Through August 2020, the firm had grown to 250 agents and 12-month sales volume of $1.5 billion.

The company plans to implement a family-of-companies playbook that other holding companies have employed. It owns title insurance firm Proper Title and mortgage lender Proper Rate. The company has made these ancillary offerings integral parts of its propriety pl@tform tech system, which each affiliate gains access to. At World affiliates will retain the ability to plug their own ancillary partners into the platform, Wong says.

The Vision

Wong and Lim see an opportunity for a new tech-powered, consumer-focused franchisor to support the raft of independent brokerages and large real estate teams facing immense disruption from fast-growing, well-funded brokerages such as Compass and Redfin.


@properties tech system pl@tform

  • CRM, includes goal-tracking and automatic updates to help agents stay in touch with their spheres.
  • Interactive CMA, which continuously updates the analysis with real-time MLS data —accessible by both agents and their clients.
  • Transaction management system, which helps brokers and agents track and process transactions from open to close.
  • @agent app, an agent app that gives agents in the @properties network access to exclusive in-house listings before they come to market.
  • Open house app.

The new franchise leaders recognize the crowded real estate franchise market, but see an opportunity with what they consider a fresh angle centered on a relationship-focused approach, a focus on coaching and mentoring franchisees, and an in-house tech platform that reinforces these value propositions. @properties has achieved over 20 percent market share in its home market of Chicago, according to Wong, who says helping affiliates achieve similar market share rates is a goal for the company.

“We know what independent brokerages need to grow, because that’s who we are,” Wong says. The company will serve as a close business consultant to its franchisees.

Wong listed five key areas of support that @world will supply franchisors:

  • Access to the companies contract-to-close tech system pl@tform, which integrates with the company’s core systems and brings consumers into key parts of the process, such as visualizing the steps to completing a transaction.
  • Marketing, with an in-house marketing studio available to agents that produces physical and digital marketing. The company will offer in-house creative marketing agency services for franchisees.
  • A vibrant culture that leverages close relationships with agents based on personalized coaching, mentorship and overall business and emotional development.
  • Coaching and Training through a custom, in-house curriculum adapted from the popular NINJA selling system, which centers on relationship-building.
  • Business Consulting: coaching on how to profitably grow with programs to enhance agent retention and recruiting, streamline operations and build ancillary business.

Takeaway

As the residential real estate brokerage industry matures, smaller brokerages will have an increasing number of options to leverage the size, scale, technology, expertise and resources a larger company or network can supply. These will be franchise brands, companies looking to acquire, broker networks and referral networks. At World is another example of this trend.

T3 Sixty – Trusted business advisors and management consultants.

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© T3 Sixty 2020. Enabling Intelligent Change.

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