A tipster dropped the following letter into our inbox last week. It appears Coldwell-Banker Burnet (for our non-local crowd, CBB is one of the "Big Two" market-share dominant real estate brokerages in the Twin Cities, the other being Edina Realty.)
Click For Larger Image
This looks to be a pretty standard "fishing" letter, so we are not holding it out as big news, just an interesting data point. The acquisition of other firms is a common strategy for larger, well financed brokerages in a soft market. The idea is to pick up some cheap market share and position themselves for the eventual turnaround.
And speaking of market share – take a gander at the following table, which compares the sales volume (LTM = Last Twelve months, as of Aug 29 2007, PTM = The previous twelve months) of a few Real Estate offices in town (update: In one particular segment of the Twin Cities, see update below). Of particular interest is the Coldwell Banker Burnet Minneapolis lakes office – often held out as the crown jewel of local CBB offices – which has seen sales volume drop by some 52% in the downtown market area. That is quite a haircut, and they are not alone (click for larger image):
**Update: After a little more digging, thanks to commenter Aaron Dickinson, it appears that the chart below describes sales volume in MLS area 302, which is the downtown Minneapolis (basically Franklin Avenue to the River) area. This is obviously less surprising, what with the slowing pace of sales and developments downtown, and not nearly as ominous as a 52% drop in total volume for that office would suggest. Apologies for any confusion, we check our facts in real time around here.
The table above might help one draw some conclusions about why CBB is out seeking to acquire firms, though what we’d really like to see is a breakdown of all the offices volume by individual broker (we are working on this.)
Related posts:
- Rumor Mill: Coldwell Banker Burnet Has Purchased Minnetonka Realty
- Minnesota Ranks Top Three in Transactions, Number of Agents, Sales Volume
- Rumor Mill: Ameriquest Shutdown, Offices Closing, Employees Ordered to Leave
- Area Housing Cools, Doghouse Market Tanks
- Lawyer Up! W Minneapolis Condos Receive Cease and Desist Letter From Starwood Hotels & Resorts
Equal Housing Lender | 
{ 4 comments… read them below or add one }
What’s up with the huge drop at ThePlaceForLofts? Is this a case of dwindling inventory as their properties fill up, or a sign of a slow-down in the downtown condo market?
That is Shamrock developments sales arm – all they rep are downtown lofts that Shamrock develps and builds
http://www.theplaceforlofts.com/
Super sensitive to swings in that market, and don’t have the broader exposure that other non-captured brokers have.
The broker report appears to be focusing simply on the downtown and/or Minneapolis market as CB Burnet’s “crown jewel” sold more than $136M in June, July & August 2007 in listings sides alone according to an MLS report I ran.
If I were CBB Id be more concerned with retention and their agents going to smaller shops with better splits.