Avalar Network Inc., a fast-growing real estate franchise company with operations in 20 states, has acquired Better Homes Realty, a San Francisco Bay Area-based franchise network with 64 offices and about 800 real estate professionals. Financial terms of the deal were not announced.
Avalar, based in Las Vegas, had about 120 offices before the acquisition, and the company’s franchise network has grown about 68 percent in the past two years. There are franchise offices in Arizona, California, Florida, Georgia, Illinois, Louisiana, Maryland, Michigan, Minnesota, Missouri, Mississippi, North Carolina, New Jersey, Nevada, Ohio, Oregon, Pennsylvania, Texas, Virginia, and Washington, D.C. The company has a handful of corporate-owned brokerage offices.
Better Homes Realty launched in the Northern California market in 1964, and has since expanded to include franchise operations throughout California. There are also Better Homes Realty affiliates in Florida, Georgia, Nebraska, New Jersey, New York, Pennsylvania and Texas.
The company is not affiliated with Better Homes & Gardens Real Estate, a franchise network that brokerage and franchise company Realogy Corp. plans to launch next month (see Inman News report). Better Homes & Gardens Real Estate operates a blog at BHGRealEstateBlog.com — Meredith had earlier operated its own franchise network through 1998 and sold that network to GMAC.
Better Homes Realty offices will preserve their brand, and new offices in the Avalar franchise network will have the option of whether to use the Better Homes Realty brand name and model or Avalar’s brand and model.
McKenzie Myers, director of franchise relations for Avalar, said that Better Homes Realty has strong brand recognition in its markets, and the market conditions present a good environment for acquisitions.
"The market is kind of weeding the strong and the weak apart," she said. "It’s the perfect timing to take advantage of everything that’s going on and to combine two brands." Myers said that Avalar’s revenue-sharing strategy has been popular with franchisees.
The company will continue to look for new additions to its network, she said. "We are not targeting particular states," she said.
Mark Williams, vice president of business development and operations for the Better Homes Realty franchise company, which has an office in Walnut Creek, Calif., said that the talks with Avalar began this year.
"Sometimes the market conditions force you to look at where you are, to look at opportunities," Williams said. "When (companies are) struggling with market conditions it’s always a great opportunity to reposition for growth in the future."
Some consumes may confuse the Better Homes Realty brand with Realogy’s planned Better Homes & Gardens brand, Williams and Myers both acknowledged, and Williams said he believes there is opportunity for the Better Homes Realty brand to gain strength with the launch of the unaffiliated network.
"I think the name just resonates — it will just resonate more … maybe because of the confusion with Better Homes & Gardens," he said. Realogy has licensed the Better Homes & Gardens brand from publishing company Meredith Corp. for a 50-year period, with the option to renew for another 50 years.
Better Homes Realty had about $1.5 billion worth of closed sales in the past 12 months, according to the announcement.
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