To office or not to office? How virtual and brick-and-mortar brokerages make it work

Growing numbers of entrepreneurial brokers are setting up new businesses with no offices, but the industry is still giving the idea pushback
  • An increasing number of entrepreneurial broker-owners are trying the virtual brokerage model, convinced that there are more important things than offices for their agents.
  • Others say it is still vital to have offices to maintain the professional image of the real estate agent and to appeal to top producers and their teams.
  • Russ Cofano, president of eXp Realty, says there is room for all models in the market.
  • Inc. 500 lister Big Block Realty founders said they tried going fully virtual, but pressure from agents led to them opening offices anyway.
  • Virtual brokerages are achieving multistate expansion thanks to no-office policies.
  • Brokerages with brick-and-mortar locations are enjoying the good times and say offices bring in business if used well.

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Brand-new brokerage Clockhouse Realty started business on January 1, servicing all of Massachusetts and Rhode Island. Jared Phillips Co-owned by James Velozo, a seasoned broker-owner, and his son, Jared Phillips, as managing partner, Clockhouse aims to be a full-service satellite real estate brokerage firm offering 90/10 splits and no offices. Why the decision to be virtual? "We quickly realized that by not opening a traditional office, we would be able to offer a much higher commission split to our agents and would also be in a position to offer reduced listing fees to our sellers," Phillips explained. But it's not just a financial decision for them. "Due to technological advancements over the last decade, we also believe the physical real estate office will soon be an antiquated notion. The technology we currently use makes it unnecessary to carry the costs of a physical real estate office," he added. The business model has not affected their ability to engage ...