That’s right: Berkshire Hathaway HomeServices.
A real estate brand kissed with the imprimatur of America’s most respected businessman.
This is a big deal.
Here are some quick thoughts:
- One might wonder “WTF?” at Brookfield giving away more than half their investment in U.S. real estate franchising less than a year after buying Prudential. But they paid only $110 million for Pru – a steal – and now have a very clear growth path. Looks like a savvy move to me.
- The brand positioning will be interesting. The Berkshire Hathaway name has never, to my knowledge, been stamped on one of its operating companies. It’s tied very closely to the personage of Warren Buffet, but if I were to place it among its competitors I’d say it’s in the upper mid-market range – around the space in which Coldwell Banker sits. It’s got an unpretentious gravitas to it.
- This new brand launches with a significant relocation operation. Brookfield, which had tons of experience in relo outside the U.S., picked up Pru’s relo operation as part of its purchase last year. This is huge for selling franchises.
- There are many existing Prudential affiliates that are deeply invested in the Pru brand, but I think most will jump at the opportunity to associate with Berkshire Hathaway. I’ve heard from some already, and they’re enthused. A conversion process that could have taken a decade will be collapsed into months.
- HomeServices of America, and an owner/operator of brokerages, has been very active in the Great Syndication Debate of the past couple years, coming down hard on the side of broker control and even threatening MLS defection. I don’t think this will transfer to the new franchise network however. Many of the Prudential brokerages have independent deals with the portals and it’s darn-near impossible to enforce an official listings stance with franchisees.
Many other wrinkles to explore here, but that’s it for now. A good day for real estate!