After more than a century in the North Bay, Frank Howard Allen Realtors closes its doors.
It was business as usual for agents of Frank Howard Allen Realtors on the last Monday of October 2013. They’d received invitations to attend a company-wide meeting (at either the Marin Country Club in Novato or Sonoma Valley Lodge, depending on where they were based) the next morning, but few had any inkling of the profound change about to take place. Time, however, was running out.
At 12:01 a.m. on Tuesday, October 29, NRT LLC, the largest residential brokerage in the United States, took possession of 17 company-owned offices of the Novato-based firm, and Frank Howard Allen, a respected player in local real estate since 1910, was no more. Owners Larry and Brennie Brackett had sold the company, closing the book on 103 years of history, and agents who’d started the week as representatives of Frank Howard Allen suddenly discovered they were working for a different brand—Coldwell Banker Residential Brokerage for those in Marin and most of Sonoma County, and Sotheby’s International Realty for those in Glen Ellen and the cities of Sonoma and Napa.
Although change is inevitable, nothing suggested to casual observers that Frank Howard Allen was about to end its run. The instability that had characterized the early years of the recession was over, and the real estate industry was bouncing back. The company’s sales volume for the previous 12 months was $1.7 billion, and with almost 300 agents on its roster, it appeared solid. Sometimes, though, a healthy environment makes the best time to sell. “I think companies that are able to withstand a big downturn don’t want to sell at the bottom,” says Rick Turley, president of Coldwell Banker Residential Brokerage in the San Francisco Bay Area. He recalls that, in 2008, some real estate companies lost value and folded, but he observes, “There’s a nice equity now. If it’s the right time for an owner to move, then they go out on a high note.”
Such was the case with Frank Howard Allen. “The Great Recession certainly had an impact on us, as it did most real estate firms, but we emerged in a healthy financial state,” says Larry Brackett, the firm’s chairman and chief executive officer, who with his wife, Brennie, had owned the company for 24 years; it had been in the family for 50. The real estate industry was evolving, he explains, and they felt responsible for giving their agents the greatest opportunity to succeed in changing times. Thus, they embarked on a lengthy process to evaluate the company and find the best way to accomplish their goals.
“The decision to sell followed an almost one-year assessment, in collaboration with our office managers, of the strengths and weaknesses of Frank Howard Allen, the competitive situation in the North Bay market and the direction of the real estate business in general,” says Brackett. “It became very clear the time was right for Brennie and me to sell the company to an entity that had significantly more resources, a strong track record of success, the right corporate culture and the support and security our Frank Howard Allen sales associates and employees deserved.”
The Bracketts chose NRT, the parent company of Coldwell Banker and Sotheby’s, because it provides the advantage of national and international branding and gives agents and clients a strong infrastructure as well as enhanced technology. “I truly believe the sale will benefit our former agents, managers and employees by giving them the resources and support they need to compete and succeed in this changing marketplace,” continues Brackett, who assumed an advisory role with Coldwell Banker following the sale.
Once negotiations with NRT began, the deal came together rapidly. “It was a very quick transaction,” says Turley, estimating that it was only a month or so from the time the Bracketts made the decision to sell until the transaction was complete. And in real estate, he doesn’t find the short timeline unusual. “A sale needs to be fast, because agents and clients are where revenues lie,” he says, explaining that if people find out about a potential sale too far in advance, it can disrupt business.
Making the transition
Despite the brief timeframe, the transition moved forward quickly—even as Brackett and Coldwell Banker executives were announcing the sale, arrangements for new signs, business cards and email addresses were in the works, and legalities that allowed agents to conduct business as usual had already taken place with the transfer of ownership. “When the ink is dry, agents are available to immediately begin conducting business under he new company umbrella,” says Turley. In addition, when they returned to their offices, agents found support was available to help them adapt to the new situation.
A primary goal was to take good care of the agents, says Noreen Smith, now a regional vice president at Coldwell Banker reporting to Turley (and formerly Frank Howard Allen’s president and chief operating officer). She believes the transition has gone well and explains that agents could call a help line to ask questions, and training was available immediately for those who were ready. “I think it’s been easy for everyone,” says Smith, who started her career at Frank Howard Allen in the accounts payable department 26 years ago when she was a college student. She points out that the administration and office staff remained in place and says, “It feels much the same. Surprisingly, there haven’t been any big challenges.” She believes the agents felt supported during the change and adds, “They’re in good hands with Coldwell Banker. It’s a great company.”
Thirteen of Frank Howard Allen’s 17 offices went to Coldwell Banker, and Turley, who’s been with Coldwell Banker since obtaining his real estate license 27 years ago (following a career as a professional figure skater), believes the two firms make a good match despite the obvious differences between a regional and a national company. In contrast to Frank Howard Allen, which had a strictly North Bay focus, Coldwell Banker Residential Brokerage has 57 offices and 3,600 sales associates in Northern California, which accounted for $17.7 billion in sales volume in 2012. Coldwell Banker is the oldest national real estate brand in the United States and today has a network of more than 84,000 agents working in approximately 3,000 offices in 51 countries and territories.
Size aside though, Turley describes the two firms as like-minded companies. “We’re very proud that the high-quality blend and caliber of agents was a perfect fit,” he says. “Coldwell Banker has a very local feel—a family feel—in its offices.”
Turley says that, though change leads to the perception that things will be different, that’s not necessarily so. He believes Coldwell Banker embraces the same values as Frank Howard Allen, and the two have more similarities than differences. Brackett expressed the same opinion following the sale, saying, “Frank Howard Allen is an ideal fit with Coldwell Banker Residential Brokerage in terms of our long proud history, our respective corporate cultures and core values, our leadership in the local housing market and our commitment to customer service and community involvement.”
Community outreach is part of the culture of both firms. Frank Howard Allen and Coldwell Banker’s offices in the North Bay have a history of running Toys for Tots and One Warm Coat drives. In 2013, they were as successful as ever, with bins of gently used coats and toys for the needy overflowing. Both have a record of collecting donations for local food banks as well. In September, Coldwell Banker raised money for Habitat for Humanity and, says Turley, “Every one of the branches has a day where they volunteer to help build homes for low-income working families through Habitat for Humanity. They also help raise money for the organization each year.”
While community involvement is much the same, the biggest changes for former FHA agents lie in the business tools and exposure a larger company can provide. Turley observes that regional companies like Frank Howard Allen have a strong local presence, but a worldwide presence is more difficult to attain. Now, as part of Coldwell Banker Residential Brokerage, the company has gained a national and worldwide presence. “It’s a very hard puzzle to figure out as an owner, but we do it very, very well,” he says, listing marketing advantages such as global outreach, multiple listings in the international market and aggregate resources as some of the benefits for Coldwell Banker agents. New technology is also an advantage. Although agents were already familiar with its benefits, “It’s like giving Frank Howard Allen a shot in the arm with technology,” says Turley.
Eighty percent of Frank Howard Allen agents made the transition to Coldwell Banker, and Turley says he’s had good feedback from them. “That’s quite successful. We always count on some loss shortly after an announcement of this sort,” he says, explaining that some agents left because they felt Coldwell Banker wasn’t a good fit for them, and, “Some people will just resist change, period.”
Beth Urban-Purtell of Coldwell Banker’s Santa Rosa Mission office is one of the agents who stayed. A realtor for 12 years, she’d spent her entire real estate career with Frank Howard Allen and describes working for the company as a positive experience, with a great team and a company that was very personal from the top down. She had a home inspection scheduled for October 29, so she was unable to attend the company meeting and got news of the sale via text from a fellow agent. But she recalls that, when agents received the invitation to the meeting the day before, “We knew something was up.” Nonetheless, she says, “I was very surprised to hear [the company had] been sold.”
She says it’s a big change, but adds that a Coldwell Banker representative was in the office the day after the sale to introduce the company’s systems, and says, “I’ve found everyone I’ve needed to speak with very approachable.” Urban-Purtell adds that Coldwell Banker staff has really been willing to help agents make the transition. Though she was an independent contractor with FHA, Urban-Purtell came from a corporate background, so she expected that going from a regional to a corporate operation would mean more available resources, which has proved to be the case. “The marketing materials are beautiful,” she says. She’s also pleased with the increased Internet exposure, which is a big benefit for the luxury market she represents. She reports an increase in inquiries and says, “I’m already seeing the results of additional marketing.” She’s found no real negatives and says, “Our office is still intact. Brian Connell [who had been part of the FHA office and remains in place] is an awesome manager.”
A different perspective
While 13 of the former Frank Howard Allen offices were making the transition to Coldwell Banker, a different scenario was unfolding in the remaining four that went to Sotheby’s International Realty, which is also under the NRT umbrella. Jeffrey Gibson, vice president and brokerage manager for Sotheby’s, believes his brand is a better fit for the area, explaining, “Our company is well known for bringing in the high end of the market” and pointing out that its share in Sonoma Valley is 33 percent. He finds that the Sotheby’s International reach is an advantage in Wine Country, because sellers like to know they’re getting wide exposure. He gives a hypothetical example of a Russian or Chinese buyer seeking to buy a vineyard or unique Wine Country property, and says that, when such a property goes on the market, the company wants to make sure the opportunity reaches those potential buyers as well as locals.
Gibson speaks highly of the Frank Howard Allen agents and says, “We’re very honored to have a new group of exceptional agents.” He adds that all but three stayed and “I think they’re pretty pleased to get a world-class brand to work with. The resources we have available are just miles ahead of where they were before.”
On the down side, however, unlike Coldwell Banker, Sotheby’s hasn’t retained all the offices it acquired. “We’re not going to maintain the previous Glen Ellen and Napa office locations,” says Gibson, explaining that only the two in downtown Sonoma would stay in business. (According to Turley, the offices in Napa and Glen Ellen closed because some wholly owned franchised offices in those areas do not belong to NRT, and existing agreements precluded competition with them.)
Cheri Stanley, a top-producing agent in the Napa office of Frank Howard Allen, is one of the agents who felt the impact of an office closing. She suspected something was afoot when she received the message announcing the companywide meeting. “I knew something was up—I just had a gut feeling,” she says in retrospect. She attended the meeting, and when she heard Brackett’s announcement, her initial reaction was irritation. “What was most disturbing was that it forced the closure of the Napa office. It left me really in a lurch,” she says. “I understand business. I understand why [the Bracketts decided to sell],” she adds, explaining that Sotheby’s and Coldwell Banker were already in Napa, so another Sotheby’s office wasn’t possible, but she lives in Napa and wonders if enough thought went into the way the sale would affect individuals.
Although she ultimately stuck with Sotheby’s by joining the Sonoma Broadway office, some agents throughout the Frank Howard Allen fold made other choices. Stanley points out that agents in the Petaluma office went to Pacific Union, which opened a new office on November 29, exactly one month after the sale of Frank Howard Allen, and some Marin agents opted to move to Pacific Union and Decker Bullock. “In some cases, core teams are no longer together,” she says, acknowledging that whenever a transition takes place, fallout is inevitable because the new owner just won’t be a good fit for some people.
For Stanley, the change mostly involved educating her client base and informing them about the differences. “All they tend to see is the brand,” she says. She views the international exposure, marketing support and technology tools that let realtors move forward with green technology and make paperless transactions as assets. “The global reach is far superior. It’s quite impressive,” she says. As a bonus, “I’ve found Jeffrey Gibson to be a wonderful person,” she adds. “All in all, it’s been a good move for me. I think I’ve navigated the transition. ”
Looking forward
While the transition appears to be progressing successfully for the most part, one thing that seems impossible to replicate is the relationship that the Brackets enjoyed with their agents. “[Larry Brackett] was truly always a wonderful, gracious person to work for,” says Stanley, and other agents echo that sentiment.
When asked if the high regard agents had for him and Brennie as owners made selling difficult, Brackett responds, “On an emotional level, yes: It was difficult to sell. But on a business level, no it wasn’t. Over the past 24 years, a number of very close relationships developed. A number of sales associates had been with the company for years, a few for more than 35 years, so that was very difficult. There was a very special relationship many of our sales associates had with the Frank Howard Allen brand.” He adds, however, “I’m really excited to see how this move will help our folks grow their business and recharge their careers.”
It’s a new chapter for North Bay real estate in response to a rapidly evolving world, and as difficult as change can sometimes be, the people most affected appear to have accepted this particular change with grace and optimism. Urban-Purtell feels some sadness that a company that was more than 100 years old no longer exists, but, she says, “There comes a point when you know people are going to retire or move on. I’m grateful for the way [Coldwell Banker has] approached the transition. I’m looking forward to 2014.”
