Manhattan brokerage Coldwell Banker Hunt Kennedy has closed its doors, with about 90 percent of its 200 agents moving to Corcoran Group Inc. and Sotheby’s International Realty Inc., company co-founder and Chief Executive Officer David Michonski said.
Michonski said the brokerage — which has roots in Manhattan going back more than 20 years — was a casualty of the financial industry meltdown. Coldwell Banker Hunt Kennedy saw the $22 million in revenue generated in 2007 decline by 35 percent last year, and another 50 percent this year, he said.
"The rest of the country has been in real estate recession for several years," Michonski said. "We entered a meltdown here starting last September that has been relentless."
The firm’s impending closure was first reported in a trade publication, The Real Deal, which cited anonymous sources and a leaked companywide memo.
Michonski dismissed as "wildly inaccurate" reports that the company is $12 million in debt and would be sold.
While the brokerage has some debts, he said, "nobody in their right mind would loan $12 million to a real estate brokerage company that only has $22 million in revenue."
"We’re closing because of the market and business conditions, and because we don’t want to incur more debt," Michonski said.
The brokerage is holding a farewell party today for about 250 employees, he said. Before it was disabled today, the company Web site listed contact information for 197 agents.
Online publication Crain’s New York Business reported that other Manhattan brokerages, including Halstead Property and Warburg Realty Partnership, have been recruiting Coldwell Banker Hunt Kennedy brokers.
But Michonski said most of the company’s agents are making what he described as an "orderly transition" to two brokerages that, like the Coldwell Banker brand, are under the umbrella of Realogy Corp.
He said most of Coldwell Banker Hunt Kennedy’s agents are following Chief Operating Officer JoAnne Kennedy to Corcoran Group. …CONTINUED
Others — including Stan Ponte, president of the Coldwell Banker Previews International division at Coldwell Banker Hunt Kennedy — are headed to Sotheby’s International Realty, Michonski said.
Agents are taking their listings and data with them, Michonski said, and will be paid the commissions they are owed.
"This company has never failed to pay anybody in our 13 years, and we’re not going to start now," Michonski said.
Coldwell Banker Hunt Kennedy is assisting agents in moving to other brokerages, allowing them to purchase their computer and monitor for $100, forwarding their e-mail and phone calls, and releasing all of their listings, he said.
It’s an "incredibly smooth operation," Michonski said, and "consumers are not affected."
When Kennedy co-founded Hunt Kennedy Inc. in 1988 with William Morris Hunt III, the company specialized in high-end properties on Manhattan’s Upper West Side, and soon expanded to the Upper East Side.
That firm merged with Michonski’s Coldwell Banker franchise in 1996, becoming a wholly owned franchised Coldwell Banker affiliate, according to a company history posted on the firm’s Web site.
"David had a plan to take a respected national franchise, place it in Manhattan and grow through referrals from across the country," Kennedy recalled in 2006 (see Inman News story). "In addition, we offered our agents an opportunity to buy a stake in the company. And this is still our policy today."
In 1998, Coldwell Banker Hunt Kennedy bought Cranford Realty in Brooklyn Heights, and in 2003 acquired one of Manhattan’s oldest firms, Charles H. Greenthal. The company relocated to "new sleek digs" at 64 W. 21st St. in March 2007, and before the downturn employed 300 agents in five offices.
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