New data shows that a number of high-profile brokerages, multiple listing services, and local franchises were among the hundreds of thousands of real estate firms that received coronavirus aid money through the Paycheck Protection Program (PPP).
The data, which the U.S. Small Business Administration (SBA) published Monday, details which firms across all industries received money that lawmakers set aside to buoy up the economy during the depths of the coronavirus crisis. Companies that participated in the program could apply for two and a half times their monthly payroll; if they used the cash to pay employees, the loan turned into a grant and didn’t have to be returned.
The SBA, which oversees the program, has in total handed out nearly 4.9 million loans adding up to more than $521 billion, according to the data. As of late June, $15.5 billion went to real estate and leasing companies via 240,355 individual loans.
In a statement Monday, U.S. Treasury Secretary Steven Mnuchin said that the program overall supported “51 million jobs and over 80 percent of all small business employees.”
And at least some of the recipients are high-profile real estate firms.
The data shows, for example, that Beverly Hills-based brokerage The Agency received between $2 million and $5 million. (The data only provides general ranges, not specific amounts that companies received.)
Hilton & Hyland, also a well-known and high-end Beverly Hills brokerage, received between $150,000 and $300,000. And Realty One Group, also based in Southern California, received between $1 and $2 million.
In New York, the program doled out between $350,000 and $1 million to Warburg Realty. And in Chicago, Baird & Warner took home between $5 million and $10 million.
Technically, PPP money was supposed to be reserved for companies with 500 or fewer employees. The idea was that smaller companies could be uniquely vulnerable to economic shocks during the crisis, and thus needed the extra financial help.
The size of qualifying companies ultimately became somewhat controversial when large companies like burger chain Shake Shack figured out ways they could still collect funds. But the overall result at this point is that major industry names such as Realogy do not appear on the list of companies that received aid.
However, numerous local franchises do.
For example, there are four Coldwell Banker brokerages, six Century 21 brokerages and two Sotheby’s International Realty brokerages — all Realogy brands — on the list.
Similarly, the list includes at least seven brokerages under the RE/MAX brand and four with Keller Williams.
The most that any of these local franchise companies received was $1 million, though most were listed as having received between $150,000 and $350,000.
Real estate trade groups also qualified for PPP cash. In total, at least 17 local Realtor organizations received $150,000 or more. Nine of those organizations are based in California, with others located in Michigan, Ohio, Hawaii and other states.
Additionally, at least nine multiple listing services also applied for and received money. They include Bright MLS, the California Regional MLS (CRMLS), My Florida Regional MLS and others. Bright MLS — a major company in the Mid Atlantic region that formed from the consolidation of other MLSs — was listed as having received between $2 million and $5 million, with the other firms falling into lower brackets.
Over the course of its run, the PPP has prompted a wide-ranging discussion about which companies ought to be receiving money. The debate kicked off in earnest after the Shake Shack debacle, and eventually the burger chain and other companies opted to return their loans. In the aftermath, some commentators even offered advice for firms that accepted the money but felt the need to defend their reputations.
Moreover, real estate companies in particular have faced challenges because many workers in the industry are classified as independent contractors — meaning there were outstanding questions at the beginning of the program regarding which real estate professionals could apply.
In the end, the real estate industry accounted for just under 3 percent of the total money the program has so far distributed.
The PPP’s rollout was also plagued by technical glitches and application logjams, and a second round of applications ultimately closed at the end of June with billions of dollars unspent.
All of these factors combined so that by June the program’s reception had become somewhat lukewarm, at least compared to the excitement it initially generated.
Nevertheless, lawmakers have now extended the deadline for the program, and as of Monday it was once again accepting applications. Now, any companies hoping to secure a loan have until Aug. 8 to throw their hat into the ring.