Real estate giant buys Coldwell Banker
Cendant subsidiary NRT set an industry record of $204 billion in sales completed last year
A subsidiary of New York-based real estate giant Cendant Corp. is expanding into Honolulu with the acquisition of Coldwell Banker Pacific Properties, Hawaii's largest residential real estate brokerage, and its commercial division.
The buyer, NRT Inc., operates in more than 35 metropolitan areas and is the largest residential real estate brokerage company in the United States. Last year, NRT posted a real estate industry record of $204 billion in completed sales.
The deal comes amid a long-lived boom in the Hawaii housing market driven by mortgage rates near historic lows. The median price of a house sold on Oahu jumped nearly 30 percent in September from last year to $615,000.
C. Scott Bradley and Herb Conley Jr., formerly co-owners of Coldwell Banker Pacific Properties, will continue as managing directors and co-presidents of the Hawaii-based operation for NRT.
Terms of the acquisition, which closed on Monday, were not disclosed.
"We are pleased that NRT will be entering such a strategic market as Hawaii," said Richard A. Smith, chairman and chief executive of Cendant's Real Estate Services Division. "This acquisition helps us continue to diversify our portfolio of leading residential real estate brokerage firms in key markets across the United States."
Created in 1995 in the merger of several major local real estate firms, Coldwell Banker Pacific has grown into the most dominant real estate agency in the state and employs more than 500 agents and 80 employees. During the past year, Coldwell Banker Pacific Properties was involved in the sale of more than 4,000 homes and handled approximately $2 billion in closed sales volume.
Cendant, a conglomerate that provides residential real estate and travel services, previously bought Honolulu-born discount air fare retailer Cheap Tickets Inc. for $280 million in 2001.
Cendant's stock hit a 52-week low yesterday on the New York Stock Exchange. The company announced last week that it plans to split into four publicly traded companies by next summer. That means NRT is transitioning from a division of Cendant to an independent, publicly traded real estate services company, but the change is not expected to have any effect on the Hawaii operations, said Judy Reeves, NRT's chief operating officer.
"It will be business as usual," Conley said, adding that the transaction will not result in a name change or layoffs.
"This will extend our potential referrals across a network that goes beyond Hawaii and across the United States, strengthening our ability to connect buyers and sellers," Conley said. "We're especially pleased to continue to do business under the Coldwell Banker brand, which has a great deal of equity for us and our associates."
Pairing with NRT will shorten Coldwell Banker's response time and enhance the services it can provide to clients, Bradley said.
"NRT can provide resources far beyond what we could provide on our own, and our sales associates and clients will see improvements in marketing, technology and services," he said.
NRT, which has long wanted to enter Hawaii's coveted real estate market, will benefit by solidifying its relationship with the state's dominant real estate firm, Reeves said.
ISLES' DOMINANT REAL ESTATE BROKER SOLD
Honolulu-based Coldwell Banker Pacific Properties Ltd. and Coldwell Banker Commercial Pacific Properties Ltd. have been sold to a mainland real estate company.
Names: Parent company Coldwell Banker Pacific Properties Ltd. and its division, Coldwell Banker Commercial Pacific Properties Ltd.
Founded: 1995 through the merger of the state's top brokerage firms.
2004 closed residential sales volume: $2 billion.
Co-owners and managing directors: Scott Bradley and Herb Conley Jr.
Purchase price: Undisclosed.
Buyer: A subsidiary of New York-based Cendant Corp., a provider of residential real estate and travel services.
NRT's operations: The largest residential real estate brokerage company in the United States with 2004 closed sales volume of $204 billion.