September 4th 2012
The Real Deal
From health insurance to technology to office space, TRD looks at the standout benefits and amenities offered by New York City residential brokerages
September marks the official end of summer — even if the thermostat says otherwise. This month, as real estate brokers bid adieu to the beach and return to the office, The Real Deal took a look at what they’ll find when they get there.
Since most agents are independent contractors (as opposed to employees), their workplace happiness involves different factors than the average worker: For real estate agents, it’s less about salary, more about commission splits; less about vacation time, more about marketing support.
Even so, there is still a range of offerings that differentiate firms from one another. TRD set out to find the best residential brokerages to work for in New York City by analyzing a number of different factors that influence brokers’ satisfaction at work. To do that, we asked residential brokerages of all sizes to complete a two-page survey detailing the unique programs and perks their companies offer. (Several large Manhattan brokerages declined to officially participate, but we interviewed brokers at those firms and other sources to find out which features get high marks from agents.)
What follows is a compilation of standout benefits and amenities offered by New York City residential brokerages.
Health care and retirement benefits
It’s rare for real estate firms to offer agents anything like the kind of benefits that most employees receive — including health insurance, paid vacation time or retirement benefits. In fact, offering such benefits can drag a firm into muddy legal waters, numerous companies noted.
“Our agents are independent contractors,” Warburg Realty stated in its submission to TRD. “We are not prepared to endanger that status either for them or ourselves by treating them like employees, which is against the tax code.”
But DSA Realty Services, a 50-agent firm that operates out of a storefront location near Union Square, does contribute to agents’ health insurance plans, much like an employer.
Here’s how it works: Agents buy their own plans (they receive a discount through DSA’s corporate parent, a national management company), and the firm reimburses them for either 35 or 70 percent of the premiums, based on their production levels, explained company president Jesse Rhinier.
Other firms have taken a different approach, offering agents discounted insurance plans. Bellmarc Realty administers insurance plans that agents can buy into at a group rate, though it doesn’t contribute to employees’ premiums. The plans are orchestrated by firm president Neil Binder, who is able to do so easily because he is a licensed insurance broker and accountant. “I had a unique skill set,” he told The Real Deal last month, “that other people who are real estate brokers may not have.”
For several years, Texas-based Keller Williams has offered customized health, dental and retirement plans to its U.S. agents through Small Business United, a small business and independent contractor association. Premiums for individual health plans, which agents pay for themselves, range from $165 to about $300 per month.
Meanwhile, Brooklyn-based brokerage Rapid Realty, which has 800 agents in about 40 different franchises across the city, recently struck a deal with Aflac Inc. to get its agents a 40 percent discount on the health, life and other products offered by the insurance giant.
Rapid founder Anthony Lolli said he hopes the partnership, which officially launches this month and comes at no cost to the brokerage, will help breed loyalty among his brokers, who “will appreciate a company that’s looking out for them.”
Meanwhile, Town Residential offers $150 annual reimbursements for gym memberships and other health-related expenses.
Perks and other extras
Numerous New York brokerages reward their agents with freebies intended to boost morale and enhance the workplace. Perks offered by city brokerages include company-funded happy hours, Zipcar memberships and discounts on car rentals, hotels and office equipment.
But a few firms offer especially notable extras.
Nest Seekers International offers the use of a chauffeured car to brokers taking out clients looking to spend at least $2 million on an apartment. Boutique firm Mercedes/Berk pays for agents’ lunches every day and covers brokers for showings when they go on vacation. And Blu Realty Group gives its agents discounts at Blu Café, the coffee shop located in its office on Riverside Boulevard.
A firm that particularly stands out in this area is Town Residential, which offers its brokers concierge services administered by Luxury Attaché, the same company that caters to the staff of Google and, when they move in next year, the residents of new condo tower One57.
The concierges — who are installed at the reception desks in each of Town’s six locations — are available free to brokers seven days a week, and do everything from booking restaurant reservations and theater tickets to hiring movers for clients. Since Town opened in December 2010, agents have put in nearly 2,000 requests for moving assistance, the firm said.
Offering these services to brokers, rather than just their clients, is an apparently unique perk among New York City residential brokerages. Town CEO Andrew Heiberger said it’s a valuable time-saver for his brokers.
“It is now too time-consuming for the best residential representatives to deliver world-class concierge assistance and simultaneously work on marketing their listings, network with new buyers and sellers, close sales and rentals, and maintain a substantive and well-balanced family life,” he wrote in an e-mail.
Town broker Robert Dvorin said that shortly after joining the firm from Prudential Douglas Elliman, he used the concierge to have his sunglasses fixed.
At Town, “you’re not just a broker, you’re a client,” Dvorin said. “That’s the philosophy.”
Access to property listings — and the ability to broadcast exclusives to other agents — is the lifeblood of a broker’s business. So the database a firm provides for accessing listings is an important consideration for some brokers when deciding where to work, particularly in a market that lacks a comprehensive multiple-listing service.
Some New York firms use third-party listings services — such as On-Line Residential, RealPlus and StreetEasy.com — but others have invested in proprietary technology that some brokers say is more wide-ranging and easier to use.
The city’s two largest residential brokerages, Prudential Douglas Elliman and Corcoran, both have their own databases, dubbed Limo and Taxi, respectively. (The firms declined to be interviewed for this story.)
Both have gotten good reviews from brokers. Taxi is “simple, easy to use, very user-friendly, [and had] a lot of information,” said a former Corcoran broker who now uses OLR, adding that Taxi seems to have more listings than OLR.
Taxi also allows brokers to add property “remarks,” such as changes to a building’s financing limits or the addition of a bike room, that are presumably only accessible to users of the system, said one broker who uses Taxi.
Limo won points with an Elliman broker for having more accurate and up-to-date listings than other services. Elliman agents can also see notes from colleagues about contract signing dates or changes to listing details, the broker said.
Some of the other firms that have designed their own listings databases include Bond New York, Town Residential, City Connections, Bellmarc Realty, Keller Williams NYC, Citi Habitats and Fenwick Keats Real Estate.
Bond’s listing database — called Bentley, as a wink at its more established competitors — has also gotten favorable reviews from its users.
Bond broker Brian Dusseau — who has worked for Manhattan Apartments, City Connections, Keller Williams and, most recently, the now-defunct Barak Realty — called the Bentley system the “most comprehensive database that I’ve worked with,” in part because it contains sales and, especially, rental listings that do not appear in other systems. That’s because Bond has relationships with smaller landlords that have open but limited listings, meaning they are not exclusives but are not widely disseminated, Dusseau said.
Also, information on customers who register with the firm is fed directly to agents’ computer dashboards, giving them the ability to link listings to clients and create show sheets, or property fact sheets, within the system.
Many of the city’s other major firms, including Stribling & Associates, Brown Harris Stevens, Halstead Property, Nest Seekers International and Sotheby’s International Realty, use RealPlus, sources said.
Unique bonding activities
Forget happy hour at your local watering hole: For City Connections brokers, bonding sessions start with discount exercise classes and tributes to the Grateful Dead.
Company founder David Schlamm has paid for tickets to see Dark Star Orchestra, a 15-year-old group that re-creates Grateful Dead concerts right down to historical set lists. About 29 City Connections agents caught the band at a recent show at the Brooklyn Bowl in Williamsburg.
Schlamm also sponsors a monthly Spin N’ Salad night, featuring a private spinning class at the New York Health & Racquet Club, followed by a dinner of salad and frozen yogurt.
About 15 agents have participated, and Schlamm said his thrice-weekly spinning classes have helped him lose 35 pounds. “I hope to lead by example for anyone who wants to get healthy,” he said.
Other firms bond by dining at B.B. King Blues Club & Grill (Rubicon Property), attending spinning classes at SoulCycle (Town) or attending regular group movie nights (Mark David & Co.).
Offices have a way of mirroring a firm’s personality.
Take the Chelsea outpost of Stribling. The office was opened in 1819 by James N. Wells & Sons, and is the longest-running residential real estate office in the country. (It is currently undergoing a renovation in tandem with the company’s image overhaul.)
By contrast, four-year-old Miron Properties’ offices have a decidedly start-up feel, and seem to embody founder Jeffrey Schleider’s reverence for Google’s corporate philosophy: The Union Square flagship features a foosball table, while the Greenpoint outpost has a graffiti mural.
For agents, offices represent more than the requisite desks and computers. A firm that offers multiple locations across the city makes it easier for brokers to work from different neighborhoods, while storefront locations help drive foot traffic and client leads, brokers said.
With 22 locations across the five boroughs, Elliman has more offices than any of its New York City rivals, according to its website. That’s almost twice as many as Corcoran’s 13 offices in Manhattan and Brooklyn.
Rapid Realty has more than 40 franchise locations, although they are less than 750 square feet, and agents do not have private desks.
It doesn’t hurt if a firm’s offices are attractive enough to impress visiting clients.
Bond New York, whose headquarters are spread over two floors at 1776 Broadway, goes for functionality — with a couple of posh touches — in its five Manhattan outposts.
The 250 Mercer Street location is in a 5,000-square-foot loft with 25-foot ceilings, while the Chelsea outpost is in a triplex townhouse featuring a landscaped backyard.
Town has earned a reputation for its striking facilities, which Heiberger and financial partner Joseph Sitt have no doubt spent a fortune on outfitting with sleek furniture and eye-catching art.
The firm’s six locations — the largest is the Flatiron flagship at 110 Fifth Avenue — each have a “Town Square” lounge area with couches and dining areas designed as a “multipurpose meeting and break space for employees.”
“You walk in there and you’re blown away by everything,” said Rutenberg’s Bernstein, who has never worked at the firm. “Some buyers and sellers need that. They love to be treated to all of that.”
Most durable branding [literally]
Many firms boast about the loyalty of their agents, but how many can back up those claims with tattoos?
In the last year or two, almost 20 agents at Rapid Realty have permanently branded their bodies with the firm’s logo, most recently last month at a Park Slope tattoo parlor. As a franchise, Rapid offers brokers a chance to run their own businesses, which may inspire the outsize dedication.
“Some folks are just that excited,” said Dumbo agent Martin Charles, who plans to open a Rapid franchise in Forest Hills, Queens, with his wife, Michele — but does not plan to get inked.
Adam Altman, a Bushwick agent whose forearm now sports a pair of interlocking Rs, explained his motivation in a YouTube video documenting the body art session:
“The company’s been good to me. I don’t see myself going anywhere, [and] if I have it on my arm, it’ll force me to keep going and working hard,” he said. “Rapid for life, yo.”
Brokerages take varying approaches to training their agents, from bringing in regular guest speakers like mortgage bankers and attorneys, to offering one-on-one coaching sessions, to letting agents shadow more-experienced counterparts. But some firms have particularly extensive or effective in-house training programs, sources said.
For newer agents, Citi Habitats’ mandatory 40-hour training program, taught from a 130-seat auditorium in the firm’s Park Avenue headquarters, is notably useful, sources said. The firm also offers one-on-one coaching with a corporate trainer, weekly 30-minute productivity workshops, special classes on topics like social media and listing photos, and events with guest speakers like Jeff Blau of the Related Companies, the firm said.
The program was implemented in 2000 by Greg Young, who went on to launch the agent training company Broker Heaven. Citi Habitats brokers interviewed by TRD identified the training as one of the best things about the company.
Meanwhile, Keller Williams NYC offers more than 60 courses — from collaborative brainstorming sessions to a coaching program called Mega Achievement Productivity Systems, or MAPS — under its Keller Williams University banner. Most of the classes, which are taught from a 120-seat auditorium at the firm’s Park Avenue office, are free for agents.
“If you want to be in school all the time, they offer enough different things,” said broker Jason Penner. Although some courses were designed by the national firm, Penner said the Manhattan franchise does a good job of tailoring classes to the local market.
Bellmarc’s training is aimed at new agents. The four-week program consists of twice-weekly seminars with Binder, Bellmarc’s president, “how to” seminars with the firm’s sales managers and outside experts, two essay-based exams and additional assignments that could involve visiting 25 open houses.
Town has also put a particular emphasis on education, not only for new agents but for those focusing on specialized topics, such as “Land Use Issues: Intro to Zoning in Manhattan,” and “Analyzing Building Financial Statements.” About 50 of the classes offered are led by Jeff Appel, the firm’s director of education and professional development, who moonlights as a mortgage broker at Citibank.
Town also offers five-hour neighborhood specialist courses focused on 17 areas of Manhattan that include a lecture and walking tour with historian and Town broker Lina Viviano. To be certified as a specialist by the firm, brokers must pass a test made up of multiple choice, fill-in-the-blank and essay questions.
More than 80 percent of Town’s agents have participated in the firm’s classes, the company said. They are taught in a 30-seat auditorium in its Astor Place office.
From in-house IT departments to user-friendly websites, technology is invaluable for real estate firms today.
In this arena, Corcoran’s online marketing efforts, led by Matthew Shadbolt, are worth noting. With more than 58,000 likes on Facebook, almost 11,000 Twitter followers, and nearly 1,000 subscribers on its dedicated YouTube channel, Corcoran is far outpacing its peers when it comes to attracting social media users, brokers said. The firm also recently debuted an iPad listings app.
One smaller firm has woven technology into its very existence: the online brokerage RealDirect.com. Launched in 2010 by CEO Doug Perlson, who helped create the online radio advertising company TargetSpot, RealDirect essentially uses technology and data to replace some duties traditionally fulfilled by brokers.
Sellers can list their home using RealDirect technology (which also feeds listings to StreetEasy.com, REBNY and other listing databases) in exchange for a 1 percent commission or $395 monthly fee, or turn over additional duties to brokers for a 2 percent commission.
Keller Williams NYC’s eEdge platform lets agents manage contacts, leads and clients, oversee their personal website and listings, automatically create and send custom marketing materials to clients and complete transactions.
In addition to an on-site tech staff, the brokerage provides round-the-clock off-site IT support. However, the tech package costs agents $150 per month (which also covers REBNY dues and errors and omissions insurance, which many firms require agents to pay for in case of professional mistakes).
At many of the city’s major firms, a 50 percent commission split is still standard for newer agents, while more experienced brokers earn around 70 percent, and star brokers can negotiate even more favorable terms.
But as TRD has reported, a number of firms with new high-commission-split business models have appeared in New York City. These firms fall roughly into two camps: those that charge minimal monthly fees plus transaction fees for each deal, and those that charge flat fees that run several hundred dollars per month.
These firms are not for everyone: trade-offs include shouldering marketing costs, working from no-frills offices and giving up a measure of camaraderie in favor of a more entrepreneurial approach. For inexperienced agents, the training, infrastructure and brand name cachet of a major firm can be invaluable for learning the ropes and building referrals, sources say.
For those interested in trying out the high-commission-split model, the following firms offer noteworthy versions of it.
Kathy Braddock and Paul Purcell’s Rutenberg Realty, which has almost 500 brokers after its founding in 2006, charges a $99 monthly fee — plus a $1,000 transaction fee for sales under $1.5 million and a $2,000 fee for sales above $1.5 million. Rental transaction fees range from $200 to $800. Brokers receive an account for the OLR listings database, a profile on the firm’s website and the use of the Rutenberg office at 127 East 56th Street (which has space for about 14 to 20 brokers at a time).
Brokers who have embraced the high-commission-split model swear by the Rutenberg approach. Robert Bernstein, a former Corcoran Group broker now at Rutenberg, said, “I’m doing the exact same thing I was [doing] at Corcoran — I’m just getting paid a lot more money.”
At City Connections, brokers start at a 70 to 90 percent split and qualify for a 100 percent split after grossing at least $83,500 in commissions. Brokers must cover their own Craigslist ads at $3 a pop, plus licensing fees and membership dues for REBNY.
Spire Group, which now claims 130 agents and is based in the Flatiron District, has a program dubbed the “True 100% Commission.” Agents pay a $495 monthly fee, but must have at least one year of experience, demonstrate a “high closing ratio” and make a full-time commitment in order to join the firm, which was founded by Kevin Kurland.
Meanwhile, Oxford Properties is one of the few firms that give brokers a choice: pay either $349 per month and keep 100 percent of the commission, or pay $49 per month and keep 90 percent. Brokers can switch plans “in good faith,” and must cover their own marketing costs. (See “For Oxford Property Group, a room of its own.”)
One of the most distinctive approaches is Keller Williams’s hybrid model. Every year brokers start at a 70 percent split until they earn $50,000 for the firm, at which point they receive 100 percent of their commissions for the rest of the year.
In exchange, brokers also pay $150 per month in technology and insurance fees; a desk fee ranging from $150 to $1,000 per month, depending on the size and location of the desk (the most expensive option being a windowed desk on Park Avenue that accommodates four); and an annual $3,000 royalty and franchise fee that is deducted from commissions.
Brokers can also qualify for profit-sharing with the firm by recruiting new agents. Although the Manhattan franchise is not officially participating in the program, since it only launched last year, about a dozen agents in the office are getting checks for referring agents who work in other U.S. locations, according to Zhann Jochinke, chief operating officer of Keller Williams NYC.
Heddings Property Group, founded several years ago by veteran broker Doug Heddings, also has a unique approach. All 26 of the firm’s agents receive the same 70 percent split and share in the firm’s profits based on their productivity. The company also has no internal competitions or awards.
Firms have different ways of providing marketing support for their brokers. Some offer unlimited advertising budgets for exclusive sale listings. Others give brokers annual budgets based on gross commission income. Some even offer their brokers the opportunity to take part in reality TV shows.
Brokers from the firms Core, Gumley Haft Kleier and Warburg have, of course, recently begun starring on HGTV’s “Selling New York.” While it’s difficult to track whether the show translates to more business — brokers from Core and Gumley Haft Kleier declined to be interviewed for this story — its 1.7 million viewers undoubtedly bring widespread exposure to the firms.
For example, Warburg officials said traffic spikes after the show is broadcast on Thursday nights. After a 30-second appearance on one episode, Kaufman said she received calls from people across the country.
But TV appearances alone won’t sell a house.
For every exclusive listing, Warburg also provides photographs taken by the firm’s in-house photographer, floor plans and show sheets at no charge to brokers. Warburg brokers also receive an annual budget based on productivity levels. “Frankly, I have not ever had to spend any extra money” out of pocket, Kaufman said.
Another marketing standout, sources say, is Town, which offers a corporate matching benefit for promotional efforts that aren’t necessarily related to one specific listing, such as charity sponsorships or client events, Dvorin said.
Inspired by Town marketing chief Nicole Oge’s time at Mercedes-Benz, the program will match up to $5,000 per year of a broker’s own contributions.
Town also covers marketing costs for sales exclusives and high-priced rentals, and provides annual budgets for agents depending on productivity, Dvorin said.
Also noteworthy is Sotheby’s, which has an extensive international presence. Unlike the other major Manhattan firms, Sotheby’s has nearly 600 offices in 40 countries across the globe. That allows for a broad network of in-firm referrals, brokers said. But in exchange, Sotheby’s agents pay higher marketing fees and insurance than brokers at other companies, as The Real Deal has reported.
When it comes to managers, everyone’s different: What strikes one agent as a lack of attention may appear to another as a welcome dose of freedom.
But some firms have paid special attention to implementing policies that transcend the varying personalities of individual managers and help all agents do better.
One such firm, sources say, is Halstead Property, led by Diane Ramirez.
While Halstead officials declined to participate in TRD’s survey, brokers at the firm describe a family-like atmosphere, where board packages never leave the office before managers give their approval.
“The two managers that we have [in the Park Avenue office] are the best I’ve ever seen in this business,” said one Halstead broker, who has worked at several other firms.
James Gricar, the firm’s general sales manager, is “a doll, an angel, the best thing since sliced bread,” said another Halstead broker.
The agents’ enthusiasm is all the more noteworthy because Halstead is a large firm, so managers have many agents to look after. With 1,000 agents in the tri-state area, about 600 of them in Manhattan, Halstead managers are spread over 11 offices in Manhattan and Brooklyn.
Downtown broker Jane Greenberg, who has been at Halstead for eight years, said new agents at the firm are given time to prove themselves.
“It’s not like, ‘Oh, gee, it’s been three months and they haven’t got a deal going,’ ” Greenberg said. “They get that there’s a learning curve.”
Warburg is another firm noteworthy for its management, namely because of its well-respected president, Frederick Peters.
“He sets a tone for the firm of dealing correctly with people and ethical behavior, and it trickles down,” said Warburg broker Harriet Kaufman.
Brokers praised Peters for his smarts, his accessibility and his quick adoption of social media and online marketing practices, exemplified by his frequently updated blog, “Fred’s View of Manhattan Real Estate.”
“Fred Peters is an incredibly, incredibly bright person,” said one former Warburg broker. “He really understands the business as a broker, and I think that’s unusual.”
Other firms are standouts for their manager-to-broker ratios. At the 50-agent DJK Residential, there is one manager for every seven brokers — a ratio on par with firms a fraction of its size, according to TRD’s research.
In any given year, there is a certain amount of broker churn within the industry, but some firms manage to keep agents for the long haul.
Of the original eight brokers at Stribling when it opened in 1980, only one has left for another firm: Barbara Fox, who departed to start her own eponymous brokerage. Many agents have worked at Stribling for decades, the company said.
Warburg also focuses on agent retention: 26 percent of its 138 agents have worked there for at least 15 years, the firm said, while 14 percent have been there for more than 20 years.
Brown Harris Stevens and Sotheby’s also have a reputation for low turnover (though both declined to provide specific figures).
Motivating the troops — with lavish prizes
Some firms offer prizes for brokers who bring in the most exclusives, signed leases, referrals or gross commission income. Among the most tantalizing:
At Spire Group, agents who bring in the most new recruits between June 15 and Sept. 15 will receive $2,500 toward a trip to the broker’s destination of choice.
Modern Spaces offers a four-day paid vacation in the Bahamas to any agent who racks up 30 rentals at a TF Cornerstone development between May and Labor Day.
At Platinum Properties, any agent who grosses $20,000 in commissions gets a custom-made suit (for men) or a shopping spree (for women).