Real Estate Office Mergers

Overview

Merging with or acquiring another business is a significant undertaking that will leave no area of your business untouched. One must pursue a merger or acquisition with caution and proper due diligence. However, with the right set of circumstances—culture cohesion, solid leadership and management, flexible employees, deft market positioning, a copacetic economy—a merger or acquisition can be a sound decision.

References

NAR Library & Archives has already done the research for you. References (formerly Field Guides) offer links to articles, eBooks, websites, statistics, and more to provide a comprehensive overview of perspectives. EBSCO articles (E) are available only to NAR members and require a password.


Quick Facts:

  • Twenty percent of firms reported that the number of mergers and acquisitions for the firm has remained the same from 2009 to 2013 and 2014 to 2018.
  • Six percent of firms indicated that mergers and acquisitions have increased in that time period.

Source: 2019 National Association of REALTORS® Profile of Real Estate Firms

  • Mergers and consolidations continued to affect about one in ten REALTORS®.
  • Nine percent of REALTORS® worked for a firm that was bought or merged in the past two years.
  • Of the REALTORS® who worked for a firm that was bought or merged, 25% left voluntarily.
  • Of the REALTORS® who stayed on to work for a new consolidated firm, 76% say compensation remained the same, compared with 11% who say it increased.

Source: 2019 National Association of REALTORS® Member Profile

Mergers and Acquisitions: The Basics 

Change in the Workplace (The Balance, Jun. 25, 2019)

Surviving and Thriving as a Manager During a Merger (The Balance, Jun. 21, 2019)

Merger vs. Takeover: What’s the Difference? (Investopedia, Apr. 13, 2019)

Rewards of Today’s Mergers (REALTOR® AE Magazine, May 4, 2018)

Real Estate Merger and Acquisition Activity

Team of Rivals: Merged RE/MAX Firms Opt for Strength in Numbers (Business Observer, Apr. 12, 2019)

Real Estate M&A Activity Hit Record Highs in 2018 – Exclusive (Pere, Mar. 28, 2019)

Merger of Coldwell Banker Brokerages Forms One of Nation’s Largest Franchises (Real Trends, Jan. 11, 2019)

Merger Mania (The Real Deal, Jul 1. 2018)

Mini Mergers: Smaller Firms Unite (The Real Deal, Sep. 1, 2018)

Due Diligence

Due diligence refers to the process of reviewing a company for potential acquisition or merger. It can include in-depth review of a company's accounting and tax records, business plan, historical performance statistics, market strategy and position, office policies, physical space, IT infrastructure, human resources, and more.

Due Diligence in Mergers and Acquisitions (Business Benefits Group, Apr. 15, 2019)

A Comprehensive Guide to Due Diligence Issues in Mergers and Acquisitions (Forbes, Mar. 27, 2019)

M&A 101: The Role of Due Diligence in Mergers and Acquisitions (PitchBook, July 23, 2018)

Business Formation: Choose a Structure

C Corporation, S Corporation, Sole Proprietorship, Partnership, or Limited Liability Company (LLC)? What are the tax, liability, and capital requirement implications of incorporating versus forming an LLC? The resources below offer a basic foundation in business formation considerations.

Understanding S Corporations (Investopedia, Jun. 25, 2019)

Should You Form an LLC For Your Small Business? (Money Under 30, Apr. 16, 2019)

The Basics of Forming a C Corporation (The Balance, Apr. 13, 2019)

LLC vs. Partnership for Real Estate (Upcounsel, Nov. 6, 2018)

Starting a Business (U.S. Small Business Administration)

Free Government Resources

Did you know that the U.S. Small Business Administration (SBA) provides a robust offering of free online and in-person courses, workshops, sample documents, monthly web chats, and FAQs to assist you in your business endeavor? It's true. Check out the SBA's website to discover offerings relevant to your needs.

The SBA’s Stay Legally Compliant topic page is great for orienting yourself with important steps to take mitigate risk when forming or reforming a business. The Write Your Business Plan topic page offers links to a diversity of materials, including free educational courses, video tutorials, checklists, and more.

The U.S. Federal Trade Commission's Guide to Antitrust Laws includes a section concerning Mergers. The Federal Trade Commission also maintains a Frequently Asked Questions about Merger Consent Order Provisions page

The National Association of REALTORS®’ Real Estate Business Institute (REBI – formerly the Council of Real Estate Brokerage Managers) offers courses on a variety of real estate brokerage topics. Visit the REBI website to learn about their credentials and course offerings

eBooks & Other Resources

eBooks.realtor.org

The following eBooks and digital audiobooks are available to NAR members:

Achieving Post-Merger Success (eBook)

Applied Mergers and Acquisitions Workbook (eBook)

Buying and Selling a Business (Kindle, eBook)

Charging Back Up the Hill (eBook)

Exiting Your Business, Protecting Your Wealth (eBook)

How to Increase the Value of Your Company (Kindle, eBook)

Merger and Acquisitions Basics (eBook)


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The inclusion of links on this page does not imply endorsement by the National Association of REALTORS®. NAR makes no representations about whether the content of any external sites which may be linked in this page complies with state or federal laws or regulations or with applicable NAR policies. These links are provided for your convenience only and you rely on them at your own risk.

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