San Francisco-based Pacific Union International Inc., ranked the ninth largest brokerage in the U.S. by sales volume, has merged with Southern California luxury brokerage John Aaroe Group.

  • Pacific Union has merged with John Aaroe Group, linking together 38 offices spread across Northern and Southern California.
  • The deal will bolster the technology efforts of both firms, according to an announcement of the merger.
Pacific Union CEO Mark McLaughlin and John Aaroe Group president John Aaroe

Pacific Union CEO Mark McLaughlin and John Aaroe Group president John Aaroe

San Francisco-based Pacific Union International Inc., ranked the ninth largest brokerage in the U.S. by sales volume, has merged with Southern California luxury brokerage John Aaroe Group.

The deal fuses two big-name brokerages that closed a combined $10.5 billion in sales volume in 2015, Pacific Union said in an announcement of the merger.

It highlights growing consolidation in the industry as brokerage profit margins shrink and technology becomes core to their value proposition.

The merger links together 1,100 real estate professionals operating in 38 offices spread across Northern and Southern California.

High-level executives of both firms said the merger would bolster their technology efforts, and John Aaroe Group president John Aaroe said it would help the brokerage reach more international buyers.

What they bring to the table

Courtesy Pacific Union

Courtesy Pacific Union

Pacific Union has invested in outreach to Chinese investors through a concierge program established in Beijing. In the announcement, Pacific Union cast the initiative as “a key success driver in the Los Angeles and San Francisco markets.”

Like a growing number of brokerages, Pacific Union also emphasized a focus on technology. It called attention to its “Innovation Lab,” which it said “is led by 25 agile real estate professionals who accelerate technology development unsurpassed in the industry.”

Pacific Union’s tech arsenal includes proprietary tools “that connect the cloud to the street, putting faster business analytics into the hands of elite real estate professionals and creating the ideal road map for the ultimate client experience,” the firm said.

The new company’s Northern California markets include San Francisco, Marin, Contra Costa, Alameda, Napa, and Sonoma counties, Silicon Valley, and the Lake Tahoe region. Beverly Hills, the Westside, Downtown, and the San Fernando and San Gabriel Valleys rank among its Greater Los Angeles markets.

Earlier this week, Inman reported that Pacific Union was looking for a potential merger partner in a story about the merger-and-acquisition scene in 2017.

In that story, Pacific Union International CEO, Mark McLaughlin, said “Pacific Union has been aggressively looking to acquire a top-tier brokerage with clear momentum on the West Coast. Finding a premium brand that matches our culture of teamwork, trust and innovation is our challenge and our priority.”

John Aaroe Group’s “strategic collaboration with Pacific Union delivers on our brokerage’s mission to expand our international reach and accelerate the adoption of the most advanced technology and innovative thinking for our real estate professionals in the industry today,” Aaroe said in a statement.

Editor’s note: Inman will update this story with more details as they become available.

Email Teke Wiggin.

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