Durable Capital Partners is run by former T Rowe Price investment manager Henry Ellenbogen. “In chaotic times, he understands our long-term commitments,” Redfin CEO Glenn Kelman said.

Redfin has reached an agreement to sell a $110 million stake in capital stock to Durable Capital Partners, a late-stage venture capital firm based in Maryland, the brokerage announced Monday.

The proposed sale, according to a filing with the U.S. Securities and Exchange Commission, is set to consist of $70 million of common stock priced at $15.61 per share — the company’s stock opened Monday at $15.85 per share — as well as $40 million of convertible preferred stock.

The convertible preferred stock will pay an annual dividend of 5.5 percent and has a conversion price of $19.51 per share — and will convert at Durable Capital Partners’ option automatically after three years or if Redfin’s common stock closes above $27.32 for 30 consecutive days.

Henry Ellenbogen, a former investment manager at T Rowe Price, founded Durable Capital Partners in 2019. According to Redfin CEO Glenn Kelman, Ellenbogen has a long history with Redfin.

“Durable’s Henry Ellenbogen has been leading investments in Redfin since 2013, when we were a private company and the market was recovering from the great financial crisis,” Kelman said in a statement. “In chaotic times, he understands our long-term commitments to our culture and our technology and why those commitments position us to take share in a housing market that is being transformed by this pandemic to be more virtual, convenient and efficient. We’re proud to be his partner.”

The move comes at a time when real estate markets are being slowed by COVID-19 — and even halted entirely in some markets. Redfin, in response to the slowdown, has cut executive and headquarters employee bonuses to raise agent compensation in anticipation of the spreading slowdown. Kelman himself plans to take no salary for the rest of the year.

Email Patrick Kearns

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Limited time: Get 30 days of Inman Select for $5.SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription