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REcolorado’s owners agreed to a proposed sale of the multiple listing service to a private equity group in part to protect it from the ongoing lawsuits targeting the real estate industry, the group said Tuesday.
Inman reported that REcolorado had obtained a letter of intent from a buyer that was shared with REcolorado employees on June 20. The deal has not yet finalized and several stakeholders have raised alarms, they told Inman.
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On Tuesday evening, REcolorado’s owners — Denver Metro Association of Realtors (DMAR) and the South Metro Denver Realtor Association (SMDRA) — said they pursued the sale in part to protect the organization.
“We strongly believe that this is the right time to sell the MLS, as the industry continues to advocate de-coupling from the real estate Associations that have long owned the MLS,” the group said in a statement. “As has been widely reported in industry reports and media coverage, decoupling MLSs and Realtor® Associations could help protect MLS organizations from ongoing antitrust litigation.”
The group pointed to a recent report that called for structuring MLSs as for-profit businesses while setting up Realtor organizations as nonprofits. It said it was limited in what else it could share about the proposed sale.
“This is a decision that our respective associations agree will help provide expanded and improved service opportunities for metro-Denver Realtors® and licensees, the members of our Associations and REcolorado subscribers that depend on the MLS to provide the vital market information required to best serve consumers in their home buying and selling process,” the group said.
REcolorado is among the largest of hundreds of MLSs in the U.S., with over 24,000 subscribers covering more than three-quarters of all transactions in Colorado.
The proposed sale came as a surprise, as at least one other group that included members of the REcolorado leadership team was pursuing a purchase when news broke that a private equity firm was the front-runner.
REcolorado vice chair Shelly Vincent told Inman on Monday that she was part of a group that was aiming to “buy back the shares and become independent, but we were given no opportunity to even compete to do so.”
“As of February, we had already accepted their counter when all communications involving the sale went silent,” she continued. “We had no idea there was another party this involved until we received the [letter of intent].”
