All month long in July, we’ll survey the changing luxury real estate market, talk to top producers and offer advice on how to level up — all leading to the gathering of the year, Inman Luxury Connect, Aug. 2-3 at the Aria in Las Vegas. Make plans now to join us there.
In this monthly column, Anthony Askowitz explores a hypothetical real estate situation from both sides of the broker/agent dynamic. Anthony is the broker-owner of South Florida’s largest RE/MAX office, and a working agent who sells more than 100 homes each year.
This month’s situation: A luxury real estate agent with a surging track record of success is negotiating a possible move to a new office. How far should a competing broker go to get her on board?
Agent perspective
I’ve been a top producer with the same company for almost two decades, and, like LeBron James in days of yore, I’m ready to take my talents to an exciting new spot. The timing could not be better: Ten years ago, I fully committed to becoming a top player in the luxury sector, and educated myself on things like high-end architecture, fabrics, landscaping, furnishing, finishes, cars, etc.
After much risk, some ups and downs, and plenty of hard work, I have been absolutely killing it for the past five years, elevating myself into the top ten of our region’s luxury producers list. While I appreciate my current company, they’re getting a little too old-fashioned for me, and I am delighted to test the free agency market.
Like anyone else in my position, I want the best of everything: obviously the highest compensation and benefits possible, but also the right “fit” for me and the way I do business. When you have four top brokers recruiting you very aggressively, you can basically write your own ticket in terms of splits, bonuses, office space and other perks.
I’ve watched other agents rise and fall in this business for a long time, and this is clearly the right moment to ask for – and get – what I want. Could anyone blame me for expecting some VIP treatment from my future office?
Broker perspective
Kudos to this agent for recognizing the value of her hard work and subsequent successes. Our office is definitely eager to recruit her, to add to our current base of luxury-focused agents. She is exactly what we look for in a recruit, and I am particularly impressed with her knowledge of all the intricacies that matter to high-end buyers and sellers.
We would be delighted to have her on the team — if the agent and I determine it is a good fit for both of us. “Team” is really the key word in that sentence. I am responsible for the overall profitability of the office, and that means keeping a positive environment for all of our agents, regardless of where they are on the path to success. Any addition must add to the benefit we have to offer, rather than causing acrimony or ill-will.
Our competitors are known to kowtow to their prima donna luxury top producers, giving them lavish perks like big offices, personal assistants, full-page ads announcing the hiring, and preferred placement on company listing ads. (Not to mention huge signing bonuses and generous splits.)
I wonder if this is a bad philosophy that breeds resentment and jealousy with their new hire’s in-office colleagues. I also wonder if the recruit has asked enough questions before biting the hook and signing a contract that may have minimal guarantees for ongoing rights to the benefits, and penalties for leaving if it turns out the agent isn’t pleased with how the reality matches up to the promises.
While I totally agree that this agent has earned every bit of respect and recognition we can give, I also believe in providing all of our company’s agents the same opportunities and benefits, period. While their colleagues may treat luxury sector top producers differently, and customers may “see” them differently, here in the office my job is to keep everyone on an equal footing, with the goal of seeing more of them reach their full potential as top producers.
I intend to offer this free agent an appealing, competitive package to entice her to join us based on how she can grow and build an even more profitable business with our help, rather than “buying” her.
How to resolve
On the surface, it seems the highly principled broker has a real challenge in overcoming the expectations of this surging rock-star luxury real estate agent. How can he possibly sell her on the benefits of walking away from cool (but short-term) sweeteners in exchange for better long-term opportunities? If we peel back some layers, there may be a pathway to victory for both parties.
An important distinction in this situation lies between the “visible” perks and benefits brokers can offer versus those that are unlikely to be known or seen by others — namely, control.
If the broker is sensitive about the optics of treating luxury agents the same as his agents in all sectors, he can put together an offer that minimizes obvious incentives such as free office space, personal assistants, and preferred advertising placement, and maximizes confidential factors such as the financial structure of building a team, and freedom (within the confines of law, ethics, and policies) of decision-making within the agent’s business.
This freedom allows the agent to run her own business without the expense and oversight that typically comes from owning a company.
This approach has the potential to satisfy all parties, with the agent ultimately securing the highly desirable compensation she deserves, and the broker avoiding a bad precedent. It shouldn’t be too hard for the broker to sell these rewards as the far more desirable elements of any offer, and to emphasize his team-based style as another strong selling point.
NOTE: Anthony Askowitz is not an attorney and does not give legal advice. Please consult a licensed attorney regarding matters discussed in this column.
Anthony Askowitz is the broker-owner of RE/MAX Advance Realty, with offices in Hollywood Beach, Davie, Miramar, North Miami, South Miami, Kendall, and the Florida Keys, and where he leads the activities of more than 190 agents. Follow him on Instagram.
