Just five years after entering the Los Angeles market, Compass is the largest residential brokerage firm in L.A.
Compass’ growth has been driven in part by big deals, including the 2019 acquisitions of Patterson Realty Inc. and Central Coast Realty Group and the 2018 purchases of Pacific Union International Inc. and Paragon Real Estate. Pacific Union had acquired Partners Trust in 2017 and John Aaroe Group Inc. in 2016.
Compass generated $12.6 billion of sales volume in 2019, up from $8.4 billion the year before, and ranked No. 1 on the Business Journal’s most recent list of residential brokerage firms.
While the company experienced a slowdown when Covid-19 first hit, it has regained its footing.
“This year for Compass, like everybody else, has been a roller coaster. It really was a challenging couple of months … but what’s pretty incredible is despite the pandemic and uncertainty in the market, Compass has pushed through and had a stellar 2020 so far,” said Kamini Lane, Compass’ regional president.
The company’s top agents, including Malibu real estate guru Chris Cortazzo, were still getting huge listings, she added.
Part of the Compass advantage, according to the company, stems from its use of technology for both customers and agents.
“We have technology that truly does power agents’ businesses, that help them make more money and save time and be more efficient and effective,” Lane said.
One tool is a customer relationship manager platform that’s powered by artificial intelligence and integrated with the greater Compass platform.
The company also uses a system called Compass Concierge that launched roughly a year ago, which Lane said agents and sellers have liked.
“It fronts the cost of repairs and improvements in order for agents to be able to sell homes faster and for more money,” she said.
According to Lane, since December Compass Concierge has been used for 12,000 projects and $12 billion worth of real estate.
Lane said Compass has also updated its comparative market analysis tool, making it easier for agents to find good sales comps.
She declined to comment on the company’s future acquisition plans but said that Compass expects “to continue to grow in Southern California, whether that’s through acquisitions or agents organically coming to Compass.”
COLDWELL BANKER RESIDENTIAL BROKERAGE
Coldwell Banker Residential Brokerage, which has 24 offices in Los Angeles, is one of the market’s most active residential brokerages.
It sold 7,221 units in the area in 2019 and finished No. 2 on the Business Journal’s latest list of residential brokerage firms by generating $10.7 billion in sales.
Jamie Duran, who serves as Coldwell Banker’s Southern California president, has been with the company for 30 years. She took on her current role in February 2019 after serving as president in the Orange County, Riverside and San Diego markets.
Duran has opened a handful of new offices and brought in hundreds of additional agents since stepping into the L.A. market.
Among Coldwell Banker’s top agents in L.A. are Jade Mills and Joyce Rey.
Mills ranked No. 8 on the Business Journal’s most recent list of top residential agents with $362 million in sales in 2019, up from $343 million in 2018. She sold 31 homes in L.A. during 2019, compared with 40 the year before.
Rey ranked No. 14 on the Business Journal’s list with $259 million of sales in L.A. in 2019, up from $162 million the previous year. In 2019, she sold 37 homes compared with 13 the year prior.
Duran has been working for several years to streamline Coldwell Banker’s offerings. She helped develop the COR4 value proposition, which focused on production power, coaching for confidence, a culture of awesomeness and wealth building.
In 2019, the company launched a Real-Vitalize pilot program, which it plans to extend to include Coldwell Banker affiliates. The program provides home sellers with home improvement resources with no upfront costs, allowing sellers to update their homes to get the most money possible.
During the pilot program, people who used RealVitalize saw their homes sell 25% faster than other homes on the market, according to Coldwell Banker.
The company also announced a collaboration last year with Amazon.com Inc. called TurnKey. The program allows buyers and sellers to get thousands of dollars in smart-home packaging.
Westwood-based KB Home is one of the largest homebuilders in L.A.
The company sold 322 units in the market in 2019, up from 280 in 2018. With an average sales price of $590,420 last year, KB Home ranked No. 2 on the Business Journal’s list of residential home builders.
KB Home is active in 42 markets in eight states and is led by Chief Executive Jeffrey Mezger.
“We produced solid results in our third quarter, moving beyond the disruption associated with the early stages of the Covid-19 pandemic that we experienced in the spring,” he said in an earnings report. “While our deliveries were lower compared to a year ago, our profitability rose meaningfully, led by a housing gross profit margin of 20.6%, excluding inventory-related charges, driving a 14% increase in our diluted earnings per share.”
The company reported net income of $78.4 million in the third quarter while revenue totaled $990 million, down 14% from the previous year.
Mezger said housing markets strengthened in the third quarter due to low mortgage rates, a limited supply and a desire to own.
Despite the Covid-19 pandemic, KB Home has been steadily opening new projects. In October, the company announced the grand opening of its Heartland Ranch project in Coolidge, Ariz. Single-family homes in the master-planned community, which features an elementary school, a children’s play area and acres of open space, start in the $190,000s.
And in September, KB Home opened a handful of projects, including Brightwood at North River Ranch in Sarasota, Fla. Homes in the project start at the low $200,000s. Some homes in the master-planned development are on the water.
Also in September, the company announced the opening of Little Soos Creek, the first community in the Seattle area to offer the KB Home Office. Homes start in the $490,000s.
In addition, the company opened Anserra Springs in Katy, Texas, in September. Homes start in the low $200,000s.
It was No. 17 on the Business Journal’s list of residential home builders in 2019, with 56 units sold in L.A., at an average sales price of $612,143.
The company was founded in 1968, but its parent company dates to 1881. Shea affiliates include Shea Properties, which owns and operates 9,000 apartment units and 4.2 million square feet of commercial space in California, Colorado and Washington, as well as Shea Mortgage Inc. and BlueStar Resort & Golf.
Shea Homes, which is based in Walnut, is led by Chief Executive Bert Selva.
The company works in California, Arizona, Nevada, Colorado, Washington, North Carolina, South Carolina, Florida, Virginia and Texas.
Despite the pandemic, Shea Homes has been busy delivering and developing new projects.
In San Diego, the company is working on five new communities, including Marquee at Civita in Mission Valley. It’s the seventh neighborhood in Civita, a master planned community. Marquee homes will start in the low $400,000s.
Homes at Summer at Park Circle in Valley Center will start in the high $400,000s while homes in Townsend at Mission Circle in San Marcos will be priced in the low $600,000s with outdoor living spaces.
Also in the San Diego market, Lumen in Sorrento Valley will have 85 three-story row homes starting in the low $800,000s, and Fuerte Ranch in El Cajon will have 36 homes priced in the mid $900,000s.
In Las Vegas, Shea Homes is working on Sunstone, a master planned 55-and-older community with detached homes, duplexes and a resort club.
The company recently broke ground on Acclaim at Alamar in Avondale, Ariz. The first phase will have 34 homes, and the second will have 48.
In addition, the company is active in the greater Denver area, having recently announced its Crescendo Collection at Stepping Stone, a master planned community that includes parks.
Other Shea Homes communities in the area include The Canyons and Solstice, near Littleton. The Canyons is a nearly 1,300-acre master planned community with 15 miles of trails and a 40-acre park. Some land is dedicated to future schools.